A federal bankruptcy trustee’s efforts to sell financially beleaguered law enforcement software firm Thinkstream to the highest bidder is being fought by Louisiana State Police, a county in Oregon and another major creditor in the case.
In a motion filed this week, an attorney for LSP objects to the sale unless the trustee can prove that any new owner of Thinkstream can make good on the tech support agreements the law enforcement agency has with the company. LSP attorney William Steffes also opposes the sale of three applications—including the source code—that Thinkstream developed for the agency. The motion notes that LSP is in settlement negotiations with the trustee over the matter, but if the dispute is not resolved, the agency will take legal action to protect its rights.
In a separate motion, Washington County, Oregon, filed a precautionary objection to any sale that is “free and clear of all liens,” as trustee David Rubin has proposed, unless the $10,240 past-due taxes Thinkstream owes are paid. According to the filing, the software firm owes unpaid property taxes and interest dating back to 2010 on its office near Portland.
Also opposing the sale is Thinkstream’s largest creditor, TSB Ventures. In its own motion, the Folsom investment firm alleges that fellow creditor FNBC—the New Orleans bank to whom the trustee proposes selling Thinkstream for a credit bid in the absence of another buyer—neglected to file the necessary paperwork to establish that it even has a legitimate claim in the bankruptcy case. TSB is challenging FNBC’s lien on Thinkstream in a separate bankruptcy proceeding.
“Allowing credit bids on an account of a disallowed claim would be absurd,” attorney Ryan Richmond writes. “Allowing a creditor who does not have an ‘allowed claim’ and moreover, who has not seen fit to even file a proof of claim is equally absurd.”
TSB also alleges that FNBC may have a prospective purchaser “in hand” to whom it plans to sell the company’s assets after the sale. “FNBC may not be a good faith purchaser,” Richmond writes, “as it would be using its credit bid and deal with a third-party purchaser outside the auction process.”
In its motion, TSB calls for an open auction, cash sale of Thinkstream.
—Penny Font
