Interstate creditors' lawyer says pension liability will be "substantially" below $530 million

By Ted A. Knutson

Washington, April 28 - Interstate Bakeries Corp.'s liability from withdrawing from pension plans will be "substantially lower" than the $530 million worst case scenario contained in a Wednesday company press release, creditors' committee lead attorney Ken Rosen predicts.

"No human being can tell what Interstate's pension liability will be because there are too many legal issues and too many issues of fact that are unknown," Rosen said in a phone conversation with Prospect News.

"[To assume the liability will be] $530 million, you have to assume everything is going to fall against the debtor. That is not a fair assumption," the head bankruptcy attorney at the Roseland, N.J.-based law firm of Lowenstein Sandler said.

He added that getting the company solvent again requires "an old fashioned operational fix" rather than the more costly repairs needed when a company has been the victim of fraud or suffered financially from a leveraged buyout gone bad.

The Kansas City, Mo., baker filed for Chapter 11 U.S. Bankruptcy Court for the Western District of Missouri on Sept. 22. Its case number is 04-45814.

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