Judge Orders Mediator to Help Decide Redwoods' Fate
Date: 25-Oct-07
Country: US
Author: Erwin Seba
US Judge Richard Schmidt expressed frustration at the slow pace Maxxam Inc. subsidiary Pacific Lumber Co. was moving since filing for Chapter 11 bankruptcy protection in January.
Schmidt issued his decision on Tuesday night in US Bankruptcy Court for Southern District of Texas at Corpus Christi after a daylong hearing.
"I'm going to put this on short-fuse mediation," Schmidt said.
Charles Hurwitz, chairman and chief executive of Houston-based Maxxam, became the target of protestors who lived in California redwoods to prevent Pacific Lumber from cutting them down in the 1990s.
Pacific Lumber signed a 1998 agreement with the state of California and the US government to protect nearly 8,000 acres of timberland including old-growth redwoods as habitat for an endangered Pacific Coast bird the Marbled Murrelet.
Pacific Lumber filed for bankruptcy protection because of its inability to pay on US$714 million in bonds. The company has taken on more debt to continue operating while working out of the bankruptcy.
Under a bankruptcy plan Pacific Lumber has put forward, 6,000 acres of timberland including old-growth redwoods would sell for US$300 million to a conservation agency or group. Other nearby timberland, also including redwoods, would be sold or developed to raise another US$1.1 billion.
Schmidt told the lawyers for Pacific Lumber and its creditors they could try to agree on a mediator, hoping it would be the first agreement reached in the case.
The mediator while have 30 days to try and hammer out an agreement between the parties involved.
"I want everyone to participate," Schmidt said. "Whether that means Mr. Hurwitz needs to attend or to send somebody.