Joel R. Glucksman
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Grant Family Farms Seeks Chapter 7 Bankruptcy Protection
Author: Joel R. Glucksman
Date: February 1, 2013
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A Colorado community has been surprised after its first organic, community-supported agricultural farm was forced to file for Chapter 7 bankruptcy protection under federal bankruptcy law.
Wellington, Colorado-based Grant Family Farms petitioned for Chapter 7 bankruptcy protection after operating in the community for 61 years. In a Chapter 7 bankruptcy, a trustee is appointed by the Office of the United States Trustee, essentially to collect and sell all property and assets that are not mortgaged or exempt. The proceeds are used to pay creditors.
The company listed a host of economic and environmental issues – including the drought of 2012 – as factors in its financial distress. Last year’s drought resulted in billions of dollars in losses for farmers throughout 80 percent of the Midwest and is considered to be the most extensive drought since the 1950s.
“Ineligibility for crop insurance coupled with millions of dollars in damage from hail storms and drought – not to mention a massive spinach recall – has left the farm in a financial situation that it’s been unable to overcome,” the company noted.
Grant Family Farms listed assets ranging between $500,001 and $1 million, while its liabilities totaled between $1 million and $10 million. Following its bankruptcy filing, the company was forced to lay off more than 50 employees.
Grant Family Farms, which operates on roughly 2,000 acres of land, said it is optimistic about the future, but cannot offer any specifics above its filing for bankruptcy. The owners said that they do not want to “churn the cogs in the rumor mill” by giving out expectations or plans.
Grant Family Farms provided produce and eggs to a number of grocery chains, including King Soopers and Whole Foods. Despite cash-flow issues in the past, many businesses associated with the farm said the filing took them by surprise.
- Practices: Bankruptcy & Creditors' Rights
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Grant Family Farms Seeks Chapter 7 Bankruptcy Protection
Author: Joel R. Glucksman
A Colorado community has been surprised after its first organic, community-supported agricultural farm was forced to file for Chapter 7 bankruptcy protection under federal bankruptcy law.
Wellington, Colorado-based Grant Family Farms petitioned for Chapter 7 bankruptcy protection after operating in the community for 61 years. In a Chapter 7 bankruptcy, a trustee is appointed by the Office of the United States Trustee, essentially to collect and sell all property and assets that are not mortgaged or exempt. The proceeds are used to pay creditors.
The company listed a host of economic and environmental issues – including the drought of 2012 – as factors in its financial distress. Last year’s drought resulted in billions of dollars in losses for farmers throughout 80 percent of the Midwest and is considered to be the most extensive drought since the 1950s.
“Ineligibility for crop insurance coupled with millions of dollars in damage from hail storms and drought – not to mention a massive spinach recall – has left the farm in a financial situation that it’s been unable to overcome,” the company noted.
Grant Family Farms listed assets ranging between $500,001 and $1 million, while its liabilities totaled between $1 million and $10 million. Following its bankruptcy filing, the company was forced to lay off more than 50 employees.
Grant Family Farms, which operates on roughly 2,000 acres of land, said it is optimistic about the future, but cannot offer any specifics above its filing for bankruptcy. The owners said that they do not want to “churn the cogs in the rumor mill” by giving out expectations or plans.
Grant Family Farms provided produce and eggs to a number of grocery chains, including King Soopers and Whole Foods. Despite cash-flow issues in the past, many businesses associated with the farm said the filing took them by surprise.