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Judge OKs Forum’s liquidation plan
YOUNGSTOWN
U.S. Bankruptcy Judge Kay Woods has approved Forum Health’s liquidation plan, clearing the way for distribution of the hospital system’s remaining assets to its unsecured creditors.
Judge Woods announced her decision on the final step of the Forum bankruptcy via teleconference Wednesday.
Included in Forum’s liquidation plan is a $1 million contribution by the Western Reserve Health Foundation (Northside Medical Center) and Trumbull Memorial Hospital Foundation as its share of the estimated $40 million in professional fees run up since Forum Health filed for bankruptcy protection in March 2009.
Under bankruptcy rules, Forum Health is responsible for all the professional fees charged by lawyers, financial and business and sales consultants.
“With confirmation of the plan, we are able to implement all the necessary processes to make distributions to the creditors in accordance with the plan and the bankruptcy code,” said Atty. Matthew A. Salerno of the legal firm of McDonald Hopkins in Cleveland, which represented Forum Health in its bankruptcy case.
Unsecured creditors are vendors who supply food, medical supplies and other items.
Salerno said there is no hard-and-fast assets-distribution time line but that it would occur “as soon as practically possible.”
Regarding Forum foundations’ financial liabilities, Salerno said: “As we stand today, the judge approved the $1 million amount of foundations.”
The Forum foundations have a combined $12 million in assets. In March 2011, Judge Woods ruled the foundation’s assets, made up of private donations, off limits to all creditors. Her order, however, was appealed by the Committee of Unsecured Creditors in U.S. District Court.
Forum Health filed for bankruptcy protection in March 2009 and was sold Oct. 1, 2010, to Community Health Services for $120 million.