A Washington, D.C., attorney hired by Alice Rogoff in her Alaska Dispatch News bankruptcy case is arguing against subjecting Rogoff's finances to deeper scrutiny until more specifics are spelled out.
Attorney James Lister of Birch Horton Bittner & Cherot's Washington D.C. office argues in a Nov. 28 filing that Rogoff, the former owner of the ADN, wasn't given ample time to produce financial documents, as requested, by Dec. 6. He also argues that bankruptcy laws allow his client to be told which people are to be witnesses. And, in a third point of the motion, seeks for Rogoff to be "more properly noticed including stating the due date for any objections."
Nacole Jipping, the public trustee in the liquidation portion of the bankruptcy, has asked the court to allow her attorney William Artus to hire additional counsel from a specialty firm, Bush Kornfeld LLP in Seattle. A flurry of back-and-forth filings in November by Rogoff's bankruptcy attorney Cabot Christianson argued against hiring the firm. The Bush Korfeld law firm could eat up proceeds that should go to the biggest creditor: Rogoff herself, he argued.
A hearing was to be held on Nov. 27 for the judge to rule on those arguments. But that hearing was postponed to Dec. 15. Bush Kornfeld LLC was to be hired on a contingency fee.
At the heart of the new arguments is the question of whose financial documents are being examined in what's known as a 2004 examination: Rogoff as an individual or the "debtor," the separate entity Alaska Dispatch LLC.
A 2004 examination provides a broader, more formal process to look in detail at debts accrued leading up to the bankruptcy. Creditors can use the exam to find property that wasn't listed as part of the bankruptcy estate. It could look at bills racked up just prior to filing bankruptcy, according federal bankruptcy rules.
Lister argues that in opening up a 2004 scope of examination and list of documents to be produced, the trustee "is exploring whether she has viable causes of action against Rogoff or her major lender, Northrim Bank, particularly with regard to the GCI sale."
The "GCI sale" refers to Rogoff selling the building on Northway Drive that housed the ADN staff and printing press to aid her acquisition of the newspaper from McClatchy for $34 million in April 2014.
In a related pleading, Jipping and Artus argued the $14.5 million sale of that building to GCI benefitted Rogoff — by having to pay less to acquire the paper — at the expense of the Alaska Dispatch.
Getting rid of the newspaper's headquarters meant she then had to lease three properties: one for her staff, one for a new press and the Northway Drive building for the working press that printed the daily.
Artus wrote on Nov. 15: "Ms. Rogoff appears to have redirected at least $14,500,000 of the Debtor's real estate asset proceeds for her own use, only to then provide funds back to the severely undercapitalized debtor and assert a claim in favor of herself. And Ms. Rogoff caused the debtor to incur substantial unsecured indebtedness while it was operating a business that did not earn enough revenue to pay its debts."
Jipping, through attorney Artus, is asking to see documents relating to the sale of the Anchorage Daily News headquarters at 1001 Northway to GCI when Rogoff originally purchased the ADN in 2014. She also requested documents on Northrim loans that Rogoff guaranteed, including communications between the bank and Rogoff. A $13 million Northrim Bank loan enabled Rogoff to pay toward the $34 million purchase of the newspaper.
At the time of the bankruptcy, she continued to owe just over $9 million on that loan. This makes Northrim Rogoff's largest secured creditor.
Another collection of dozens of small businesses and individuals are owed a about $2.3 million.
"Rogoff thus has good reason to believe the Trustee's Rule 2004 Motion implicates her personal interests, as well as her role as a corporate representative of the corporate Debtor ADN," Lister argued on Nov. 28. "However, the Trustee's Motion does not name the parties to be examined or specify which persons are to produce documents, and thus Rogoff can only guess how the Trustee wants to involve Rogoff in the Rule 2004 examination(s)."
As Christianson argued in previous filings, Lister continued the assertion that Rogoff is the largest unsecured creditor. She "loaned" the Alaska Dispatch LLC $16.6 million to keep the paper afloat and therefore is entitled to 80 percent of whatever proceeds come to pay back the bills at the end of the trustee's liquidation process, Lister said.
Lister wants to know more about where Jipping's 2004 inquiry is headed.
"Until more is known about the Trustee's intentions, it is premature for Rogoff to assert substantive objections to the scope of the examination or the list of documents to be produced," he wrote.
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