On July 18, 2008, Derecktor Shipyards Conn., LLC announced that the company filed a voluntary petition for reorganization under Chapter 11 of the United States Bankruptcy Code. The company said that it intends to maintain all normal business operations throughout the bankruptcy process. Its decision to file bankruptcy was a result of several factors, most notably issues relating to a contractual dispute.
“The company has been engaged in lengthy negotiations to resolve issues relating to one of its contracts,” said Paul Derecktor, president of the company. “Unfortunately, the resolution of those issues were made impossible to achieve outside of the bankruptcy process.”
Mr. Derecktor continued, “The action we have taken is a necessary step to preserve the company’s value for its creditors, customers, employees and other stakeholders as we work towards the future success of the company. The company is committed to complete the reorganization as quickly as possible.
We intend to use this reorganization process to take the actions necessary to ensure that the company remains a worldwide leader in the building of custom boats. We will continue to employ the best craftsmen and skilled laborers to transform aluminum and steel into the finest sailing and motor yachts, high speed ferries and innovative workboats.”
James Berman, of Zeisler & Zeisler, attorneys for the company, said: “The relief afforded by Chapter 11 is particularly well suited to address the issues which precipitated the filing.”
The company has filed a series of first day motions in the Bankruptcy Court in Bridgeport, CT, to ensure that the company will not have any interruption of normal operations. The company’s employees will be paid in the usual manner and their health and welfare benefits are expected to continue without disruption. Derecktor Shipyards – with operations in New York, Florida and Connecticut – has produced more than 250 aluminum yachts and commercial vessels. Current projects include a 44 m (145 ft.) catamaran; an 85.6 m (279 ft.) motor yacht; and (2) Offshore Terminal Tugs (30m and 39m) for Boston Towing and Transport, which it announced on July 23, 2008.