HTML Document View

Full title: Fifth Motion to Extend Time to File and Serve Objections to Claims Filed by Interested Party WMLP Liquidation Trust (Attachments: # 1 Proposed Order) (Wertz, Jennifer) (Entered: 03/26/2021)

Document posted on Mar 25, 2021 in the bankruptcy, 9 pages and 0 tables.

Bankrupt11 Summary (Automatically Generated)

Pursuant to the WMLP Plan and WMLP Liquidation Trust Agreement, the WMLP Liquidation Trustee has the sole authority to review, reconcile, settle, or object to all Claims or Disputed Claims (as defined in the WMLP Plan) as of the Effective Date.On November 9, 2018, the Debtors filed their Statements of Financial Affairs and Schedules of Assets and Liabilities, as required by § 521 of the Bankruptcy Code (collectively, the “Schedules”) pursuant to Bankruptcy Rule 1007 and the Order Extending Time to File Schedules of Assets and Liabilities, Schedules of Current Income and Expenditures, Schedules of Executory Contracts and Unexpired Leases, and Statement of Financial Affairs [ECF No. 82].Accordingly, because the WMLP Effective Date of the WMLP Plan was June 21, 2019, and pursuant to the provision of Bankruptcy Rule 9006(a)(1) that states “if the last day is a Saturday, Sunday, or legal holiday, the period continues to run until the end of the next day that is not a Saturday, Sunday, or legal holiday,” the WMLP Liquidation Trust was required to file objections to Claims by no later than September 18, 2019, absent an extension of that deadline.Although significant progress has been made, and the WMLP Liquidation Trustee at present is not aware of any outstanding claim for review or objection, an extension of the Claims Objection Bar Date as requested herein is necessary and in the best interests of the WMLP Liquidation Trust and all parties in interest. The WMLP Debtors will provide notice of this Emergency Motion to: (a) the Office of the United States Trustee for the Southern District of Texas; (b) the Committee; (c) the indenture trustee under the WLB Debtors’ 8.75% senior secured notes due 2022; (d) the ad hoc group of lenders under the WLB Debtors’ prepetition term loan facility due 2020 and the WLB Debtors’ 8.75% senior secured notes due 2022; (e) the administrative agent under the WLB Debtors’ prepetition term loan facility due 2020; (f) the administrative agent under the WMLP Debtors’ term loan facility due 2018; (g) the ad hoc committee of certain lenders under the WMLP Debtors’ term loan facility due 2018; (h) the administrative agent under the WLB Debtors’ debtor-in-possession financing facility; (i) the lenders under the WLB Debtors’ debtor-in-possession financing facility; (j) counsel to the Conflicts Committee of the Board of Directors of Westmoreland Resources GP, LLC; (k) the United States Attorney’s Office for the Southern District of Texas; (l) the Internal Revenue Service; (m) the United States Environmental Protection Agency and similar state environmental agencies for states in which the Debtors conduct business; (n) the offices of the attorneys general for the states in which the Debtors operate; (o) the United States Securities and Exchange Commission; (p) the Pension Benefit Guaranty Corporation; and (q) any party that has requested notice pursuant to Bankruptcy Rule 2002.

Page 1

UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION § In re: § Chapter 11 § WESTMORELAND COAL COMPANY, et al.,1 § Case No. 18-35672 (DRJ) § Debtors. § (Jointly Administered) § FIFTH MOTION FOR ENTRY OF AN ORDER EXTENDING THE TIME PERIOD TO FILE AND SERVE OBJECTIONS TO CLAIMS This motion seeks an order that may adversely affect you. If you oppose the motion, you should immediately contact the moving party to resolve the dispute. If you and the moving party cannot agree, you must file a response and send a copy to the moving party. You must file and serve your response within 21 days of the date this was served on you. Your response must state why the motion should not be granted. If you do not file a timely response, the relief may be granted without further notice to you. If you oppose the motion and have not reached an agreement, you must attend the hearing. Unless the parties agree otherwise, the court may consider evidence at the hearing and may decide the motion at the hearing. Represented parties should act through their attorney. The WMLP Liquidation Trustee for the WMLP Liquidation Trust respectfully states as follows in support of this motion (this “Motion”): Relief Requested 1. The WMLP Liquidation Trustee seeks entry of an order, substantially in the form attached hereto (the “Order”) (a) extending the Claims Objection Bar Date2 to September 25, 2021, without prejudice to the rights of the WMLP Liquidation Trustee to request further 1 Due to the large number of debtors in these chapter 11 cases, for which joint administration has been granted, a complete list of the debtors and the last four digits of their tax identification, registration, or like numbers is not provided herein. A complete list of such information may be obtained on the website of the Debtors’ claims and noticing agent in these chapter 11 cases at www.donlinrecano.com/westmoreland. Westmoreland Coal Company’s service address for the purposes of these chapter 11 cases is 9540 South Maroon Circle, Suite 300, Englewood, Colorado 80112. 2 All capitalized terms used but otherwise not defined herein shall have the meanings set forth in the Amended Joint Plan of Liquidation for the WMLP Debtors, as Modified [ECF No. 1967] (the “WMLP Plan”).

Page 2

extensions of the Claims Objection Bar Date to the extent consistent with the WMLP Plan (as defined herein), and (b) granting related relief. Jurisdiction and Venue 2. The United States Bankruptcy Court for the Southern District of Texas (the “Court”) has jurisdiction over this matter pursuant to 28 U.S.C. § 1334. This is a core proceeding pursuant to 28 U.S.C. §157(b). The WMLP Liquidation Trust confirms its consent, pursuant to rule 7008 of the Federal Rules of Bankruptcy Procedure (the “Bankruptcy Rules”), to the entry of a final order by the Court. 3. Venue is proper pursuant to 28 U.S.C. §§ 1408 and 1409. 4. The bases for the relief requested in this Motion are sections 105(a) of title 11 of the United States Code, 11 U.S.C. §§ 101–1532 (the “Bankruptcy Code”), and Rule 9006 of the Federal Rules of Bankruptcy Procedure (the “Bankruptcy Rules”). Background 5. On October 9, 2018 (the “Petition Date”), each of the WMLP Debtors3 filed a voluntary petition for relief under chapter 11 of title 11 of the United States Code (the “Bankruptcy Code”). On October 18, 2018, the United States Trustee for the Southern District of Texas (the “U.S. Trustee”) appointed an official committee of unsecured creditors pursuant to § 1102 of the Bankruptcy Code (the “Committee”) [ECF No. 206]. 6. A detailed description of the Debtors and their businesses, and the reasons for commencing the chapter 11 cases, are set forth in greater detail in the Declaration Jeffrey S. Stein, 3 Specifically, the WMLP Debtors are: (a) WMLP; (b) Westmoreland Kemmerer, LLC; (c) Oxford Mining Company, LLC; (d) Harrison Resources, LLC; (e) Oxford Mining Company-Kentucky, LLC; (f) Daron Coal Company, LLC; (g) Oxford Conesville, LLC; and (h) Westmoreland Kemmerer Fee Coal Holdings, LLC.

Page 3

Chief Restructuring Officer of Westmoreland Coal Company in Support of Chapter 11 Petitions and First Day Pleadings [ECF No. 54]. 7. On June 5, 2019, the Court entered the Order Approving Disclosure Statement and Confirming Amended Joint Plan of Liquidation for the WMLP Debtors, as Modified (the “Confirmation Order”) [ECF No. 1967] confirming the WMLP Plan. 8. The WMLP Plan’s effective date occurred on June 21, 2019 (the “WMLP Effective Date”). See Notice of (I) Entry of Order Confirming Amended Joint Plan of Liquidation of the WMLP Debtors and (II) Occurrence of the Plan Effective Date [ECF No. 2068]. 9. On the WMLP Effective Date, the WMLP Liquidation Trust was established in accordance with the Liquidation Trust Agreement, and CFOservices LLC, of which Gerald A. Tywoniuk is the sole member, was appointed as the WMLP Liquidation Trustee. 10. Pursuant to the WMLP Plan and WMLP Liquidation Trust Agreement, the WMLP Liquidation Trustee has the sole authority to review, reconcile, settle, or object to all Claims or Disputed Claims (as defined in the WMLP Plan) as of the Effective Date. See WMLP Plan, Art. VI.B.1. 11. On June 17, 2019, the Court entered a Final Decree Closing the WMLP Debtors’ Chapter 11 Cases (the “Final Decree”) [ECF No. 2099]. The Claims Reconciliation Process 12. On November 9, 2018, the Debtors filed their Statements of Financial Affairs and Schedules of Assets and Liabilities, as required by § 521 of the Bankruptcy Code (collectively, the “Schedules”) pursuant to Bankruptcy Rule 1007 and the Order Extending Time to File Schedules of Assets and Liabilities, Schedules of Current Income and Expenditures, Schedules of Executory Contracts and Unexpired Leases, and Statement of Financial Affairs [ECF No. 82].

Page 4

13. On November 15, 2018, the Court entered its Order (I) Setting Bar Dates for Filing Proofs of Claim, Including Requests for Payment Under Section 503(b)(9), (II) Establishing Amended Schedules Bar Date and Rejection Damages Bar Date, (III) Approving the Form of and Manner for Filings Proofs of Claim, Including Section 503(b)(9) Requests, and (IV) Approving Notice of Bar Dates (“Bar Date Order”) [ECF No. 524]. The Bar Date Order established that all proofs of claim for non-governmental entities holding or wishing to assert a “claim” (as defined in section 101(5) of the Bankruptcy Code) must be filed on or before December 12, 2018 at 5:00 p.m. (prevailing Central Time), and April 8, 2019 at 5:00 p.m. (prevailing Central Time) for governmental entities holding or wishing to assert a “claim” (as defined in section 101(5) of the Bankruptcy Code). 14. On March 27, 2019, the Court entered its Order Approving Omnibus Claims Objection Procedures and Filing of Substantive Omnibus Claims Objections (“Objection Procedures”) [ECF No. 1651]. 15. To date, over 1,369 proofs of claims have been filed against the WMLP Debtors and WLB Debtors, totaling over $2.772 billion in the aggregate for liquidated amounts. Because of the large number of claims in these cases, the WMLP Debtors sought and have been granted approval to file omnibus objections to certain claims in accordance with the procedures set forth in the Order Approving Omnibus Claims Objection Procedures and Filing of Substantive Omnibus Claims Objections [ECF No. 1546] (the “Objection Procedures”). 16. Pursuant to Article VI.B of the WMLP Plan, the WMLP Liquidation Trust is required to file objections to Claims on or before the Claims Objection Bar Date. Accordingly, because the WMLP Effective Date of the WMLP Plan was June 21, 2019, and pursuant to the provision of Bankruptcy Rule 9006(a)(1) that states “if the last day is a Saturday, Sunday, or legal

Page 5

holiday, the period continues to run until the end of the next day that is not a Saturday, Sunday, or legal holiday,” the WMLP Liquidation Trust was required to file objections to Claims by no later than September 18, 2019, absent an extension of that deadline. 17. On December 6, 2019, the Court entered the Order Extending the Time Period to File and Serve Objections to Claims Under the WMLP Plan [ECF No. 2551] (the “First Extension Order”), whereby the Court extended the time to file objections to Claims pursuant to the WMLP Plan through and including March 17, 2020. 18. On March 12, 2020, the Court entered the Order Extending the Time to File and Serve Objections to Claims Under the WMLP Plan [ECF No. 2891] (the “Second Extension Order”), whereby the Court extended the time to file objections to Claims pursuant to the WMLP Plan through and including May 18, 2020. 19. On May 15, 2020, the Court entered the Order Extending the Time to File and Serve Objections to Claims Under the WMLP Plan [ECF No. 2960] (the “Third Extension Order”), whereby the Court extended the time to file objections to Claims pursuant to the WMLP Plan through and including September 30, 2020. 20. On September 30, 2020, the Court entered the Order Extending the Time to File and Serve Objections to Claims Under the WMLP Plan [ECF No. 3145] (the “Fourth Extension Order”), whereby the Court extended the time to file objections to Claims pursuant to the WMLP Plan through and including March 29, 2021. 21. Although significant progress has been made, and the WMLP Liquidation Trustee at present is not aware of any outstanding claim for review or objection, an extension of the Claims Objection Bar Date as requested herein is necessary and in the best interests of the WMLP Liquidation Trust and all parties in interest. The WMLP Liquidation Trust is finalizing the

Page 6

process of reviewing the proofs of claim filed against the WMLP Debtors to determine the validity of such claims, and has diligently worked to resolve such claims—including through objecting to such claims where necessary. Specifically, the WMLP Liquidation Trust needs additional time to finalize review of and the ability to object to less than a handful of open claim-related matters, as well as to fully wind down the claim process in these chapter 11 cases with respect to the WMLP Liquidation Trust. The WMLP Liquidation Trust believes it is close to reaching resolution on some IRS matters and one New York tax matter, and may need to pursue a claim objection if consensual resolution proves elusive. Basis for Relief 22. Section 105(a) of the Bankruptcy Code provides that the Court may issue any order that is necessary or appropriate to carry out the provisions of the Bankruptcy Code. 11 U.S.C. § 105(a). Pursuant to Bankruptcy Rule 9006(b)(1), “when an act is required or allowed to be done at or within a specified period . . . by order of the court, the court for cause may at any time in its discretion . . . with or without motion or notice order the period enlarged if the request therefore is made before the expiration of the period originally prescribed.” 23. To allow the WMLP Liquidation Trustee sufficient time to finish its review of the filed proofs of claim against the WMLP Debtors, the WMLP Liquidation Trustee requests an extension of the Claims Objection Bar Date to and including September 25, 2021, which is an extension of 180 days. The WMLP Liquidation Trustee and his professionals have analyzed and, in some cases, resolved or satisfied the proofs of claim against the WMLP Debtors during these chapter 11 cases. 24. The WMLP Liquidation Trust and its advisors have worked diligently to review the claims that were filed in the chapter 11 cases. The claims remaining that may be subject to an objection (the “Remaining Claims”) exist as a result of the large number of overall claims

Page 7

originally asserted and the factual and legal complexities associated with certain claims, and late claims that have arisen post-WMLP Effective Date. Rather than object to the few remaining claims merely to satisfy the current deadline, the WMLP Liquidation Trustee believes it is in the best interests of the estates to continue their diligent review and reconciliation process. 25. If the Claims Objection Bar Date is not extended, the WMLP Liquidation Trust and other creditors would be highly prejudiced. An extension of the Claims Objection Bar Date will ensure that the WMLP Liquidation Trust completes the reconciliation process, does not unnecessarily forfeit valid defenses to claims, does not expend resources in objecting to claims that could otherwise be resolved consensually, and does not otherwise permit claims to be allowed in amounts that are not justified. Permitting the Remaining Claims to be allowed before the reconciliation process has been completed would result in windfalls for those claimants and unjustly dilute the recoveries of creditors with valid claims. 26. An extension of the Claims Objection Bar Date by 180 days, through and including September 25, 2021, is authorized by the Bankruptcy Code and the terms of the WMLP Plan, and should be granted. Notice 27. The WMLP Debtors will provide notice of this Emergency Motion to: (a) the Office of the United States Trustee for the Southern District of Texas; (b) the Committee; (c) the indenture trustee under the WLB Debtors’ 8.75% senior secured notes due 2022; (d) the ad hoc group of lenders under the WLB Debtors’ prepetition term loan facility due 2020 and the WLB Debtors’ 8.75% senior secured notes due 2022; (e) the administrative agent under the WLB Debtors’ prepetition term loan facility due 2020; (f) the administrative agent under the WMLP Debtors’ term loan facility due 2018; (g) the ad hoc committee of certain lenders under the WMLP Debtors’ term loan facility due 2018; (h) the administrative agent under the WLB Debtors’

Page 8

debtor-in-possession financing facility; (i) the lenders under the WLB Debtors’ debtor-in-possession financing facility; (j) counsel to the Conflicts Committee of the Board of Directors of Westmoreland Resources GP, LLC; (k) the United States Attorney’s Office for the Southern District of Texas; (l) the Internal Revenue Service; (m) the United States Environmental Protection Agency and similar state environmental agencies for states in which the Debtors conduct business; (n) the offices of the attorneys general for the states in which the Debtors operate; (o) the United States Securities and Exchange Commission; (p) the Pension Benefit Guaranty Corporation; and (q) any party that has requested notice pursuant to Bankruptcy Rule 2002. In light of the nature of the relief requested, no further notice is necessary. WHEREFORE, the WMLP Liquidation Trust requests entry of an order, substantially in the form attached hereto, granting the relief requested herein and granting such other relief as is just and proper. Houston, Texas March 26, 2021 /s/ Jennifer F. Wertz Matthew D. Cavenaugh (Bar No. 24062656) Jennifer F. Wertz (Bar No. 24072822) Vienna F. Anaya (Bar No. 24091225) JACKSON WALKER L.L.P. 1401 McKinney Street, Suite 1900 Houston, Texas 77010 Telephone: (713) 752-4200 Facsimile: (713) 752-4221 Email: mcavenaugh@jw.com jwertz@jw.com vanaya@jw.com Co-Counsel to the WMLP Liquidation Trust

Page 9

Certificate of Service I certify that on the 26th day of March 2021, I caused a copy of the foregoing document to be served by the Electronic Case Filing System for the United States Bankruptcy Court for the Southern District of Texas. /s/ Jennifer F. Wertz Jennifer F. Wertz