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Corporate Resource Services Settlement Approval Sought

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Corporate Resource Services’ Chapter 11 trustee filed with the U.S. Bankruptcy Court a motion for entry of an order approving a settlement agreement with Del Monte Fresh Production and Del Monte Fresh Produce.

The motion explains, “As part of the ongoing administration of the jointly administered estates before the Court in these cases, the Trustee seeks authority to settle the largest – and perhaps most contentious – litigation over the collection of accounts receivable, for an affirmative recovery in the amount of $2,000,000 by the estates of TS Staffing Services and Diamond Staffing Services, the ‘Estates.’ The proposed settlement arises in litigation commenced prior to the filing of these chapter 11 cases, by DMI as plaintiff in the United States District Court for the Southern District of Florida, against TS Staffing Services, (‘TSS’), seeking damages in excess of $12,000,000 for alleged breaches, acts and omissions in connection with a contract to provide temporary labor for certain tomato farming operations in Florida and Virginia.”

In addition, “The Trustee believes and respectfully avers to this Court that the proposed settlement is in the best interest of the Estates, providing an immediate $2,000,000 lump-sum payment….Should Del Monte fail to make the $2,000,000 payment within five (5) days of this Court’s final approval of the Settlement Agreement, the Trustee will become entitled to the entry of a final consent judgment against DMI and DMNA, jointly and severally, in the amount of $2,750,000.” The Court scheduled an April 19, 2017 hearing to consider motion.

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