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Firm ordered to hire new lawyer
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Posted on Apr 16 2001
District Court Judge Alex R. Munson ordered Micronesian Health Corporation, the petitioner in a hotly contested Chapter 11 reorganization case, to obtain new counsel for the Corporation.
Mr. Munson issued the order during a hearing in US bankruptcy Court Friday.
While ruling from the bench that corporate attorney Robert Kutz had acted in good faith throughout the proceedings, Judge Munson ordered Mr. Kutz to withdraw from the case.
The judge cited the need to avoid even the appearance of a conflict of interest arising out of Mr. Kutz’s relationship with MHC shareholder/director Jaroslav K. Richter, MD.
Anthony Glad, vice-president and CFO of MHC, stated that the corporation will seek a new counsel as ordered, but that business operations of Island Medical Center will continue uninterrupted under the supervision of Medical Director, Stephan J. Lebanoff, MD.
MHC, the company that owns and operates Island Medical Center has filed for protection under Chapter 11 of the US Bankruptcy Code.
Since creditors, vendors and people in the community are often concerned when word reaches them that a business has filed a petition in bankruptcy, Mr. Glad said Island Medical Center is even expanding its operations into a full-service family medical clinic under the supervision of Dr. Lebamoff, as medical director.
“It is most important that our creditors and clients understand that we have engaged upon a Chapter 11 Reorganization procedure, not Chapter 7 Liquidation in Bankruptcy,” says Mr. Glad.
Within the framework of the Chapter 11 Reorganization, arrangements are made to continue paying all creditors on an appropriate and timely basis, and to continue business operations under the general supervision of the US Trustee.
Mr. Glad said he would be more than willing to answer questions from the community about the issue.
