Irish Bank Resolution representatives seek stay of second Flynn action

By Caroline Salls

Pittsburgh, Dec. 31 - Irish Bank Resolution Corp. Ltd.'s foreign representatives asked the U.S. Bankruptcy Court for the District of Delaware to rule that a group of lawsuit plaintiffs violated the automatic stay when they filed a second action against the company's representatives and others involved in its liquidation, according to a Dec. 31 court filing.

Within two days of the entry of the court's order recognizing the Irish Bank Resolution Chapter 15 petition, the foreign representatives said the "Flynn plaintiffs" filed a second action in federal court in the Southern District of New York "as a further step in their campaign to frustrate and delay the efforts of the special liquidators to maximize the value of IBRC's remaining assets for the benefit of IBRC's legitimate creditors."

The foreign representative said the requested stay is essential to protect assets of Irish Bank Resolution's estate and to prevent interference with the conduct of its Irish proceeding.

According to the Dec. 31 filing, the Flynn plaintiffs are all borrowers and/or guarantors of loans issued by Irish Bank Resolution's predecessors.

Also on Dec. 31, John Flynn Sr. filed an appeal of the Dec. 18 order granting recognition of Irish Bank Resolution's foreign main proceeding.

As previously reported, John Flynn Sr., a permanent U.S. resident who operates U.S. corporations, joined Castleway Properties, LLC and Walnut-Rittenhouse Associates, LP in opposition to final recognition of the proceedings in Ireland.

At issue was whether the special law enacted by the Irish Parliament to wind down the company's operations met the requirements for recognition under Chapter 15 of the U.S. Bankruptcy Code.

Flynn, Castleway and Walnut-Rittenhouse argued that Ireland's minister of finance is the owner of the businesses involved in the wind down, is the person in ultimate control of the wind-down process and can change the course of the case without consultation with interested parties and without concern for judicial review or reversal.

Flynn sued the company in New York state court, alleging 18 years of overcharging by Irish Bank Resolution and its predecessor, Anglo-Irish Bank. He says the company owes him $11 million.

Irish Bank Resolution, a Dublin-based successor to Anglo Irish Bank, filed for bankruptcy on Sept. 17. The Chapter 15 case number is 13-12159.

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