And you thought you were having a bad day.

[4stringer77]

Not as bad as Henry is having. Being sued for 50 million.

[Dave W]

I doubt that his layman's legal analysis is right, but it's good that he's bringing it to our attention.

Now, if we only had, say, a couple of Dutch speakers here, we might be able to learn some more about it. 

[Basvarken]

From the Financieel dagblad (financial newspaper) Translated by Google:

The then board of Gibson Innovation Netherlands, which went bankrupt in 2018, has received a summons. This comes from the trustee in this bankruptcy, Floris Dix of Turnaround Advocaten from Best. He believes that the three Gibson managers at the time have committed maladministration. In extreme cases, the court can hold them liable for the shortfall in the estate, which amounts to €50 million.

and


Bankruptcy trustee Dix has now invested almost 1700 hours in the handling of the bankruptcy of Gibson Innovations Netherlands. For example, it took a long time before he received financial information. And once the time had come — from an SAP system in Hong Kong — the data was "very voluminous and virtually impossible for the trustee to fathom." A financial expert has since joined.

An extensive questionnaire to the drivers that he sent them two years ago did not give satisfactory answers. With the summons, Dix deploys heavier guns. When asked, the trustee did not want to say what exactly is in the summons. He merely refers to his last report, published on 5 June. It states that the directors have been summoned on the basis of article 248 of the Civil Code 2 and article 162 of the Civil Code 6 article.

Closer reading shows that this may concern, for example, non-compliance with the obligation to file the annual figures. There must be a suspicion that the improper performance of duties is an important cause of the bankruptcy. And there is a case of an unlawful act, the perpetrator of which is obliged to compensate the damage.

"I'm not going to do naming and shaming," says Dix about the reason for not wanting to share the summons with the FD. To refer at once to another passage in his latest report: 'Please note, this is only an opinion of the curator. A judge has not yet ruled on the claims of the curator.'

[uwe]

Sounds like a joint venture went awry and people are looking for a scapegoat - that is the job of insolvency administrators, happens all the time, sometimes for good reason, sometimes not. The claimed figure is nothing outlandish.

The name "Dave Berryman" immediately rang a bell with me, he was (together with Henry J and Gary Zebrowski) one of the three investment bankers who bought Gibson in 1986 when no one else wanted to have it.

https://www.bmhof.org/inductees-b/dave-berryman.html

I'm philosophical about the Henry J era: He saved Gibson at the time, reestablished it as a brand, did countless things wrong and countless things right (as you inevitably do in such a position), his quest to diversify the brand (which can be a sensible thing to do, but often also bears risks) didn't really work out and bad finance management finally got the best of him. Procuring protected woods from shady dealers and then being less than forthright about it wasn't great either. He was autocratic and advice-resistant in the end (and the massive delay in producing the audited annual accounts especially was desperate and already a financial death throe), but I never saw him as a white collar crook, just someone who was too proud to get in the right help at the right time and then began hiding the mess from his creditors - and once on that slippery slope resorting to illicit tricks doing so.

That said, Gibson and Epiphone as guitar brands were in better shape 2018 when they filed for Chapter 11 than 32 years earlier when everyone thought the three youngish greenhorn investment banker city slickers Berryman, Juskiewicz (Henry was only 33 at the time) & Zebrowski plain nuts for buying always ailing Gibson in the age of the Super-Strat and doomed to failure.

None of this says anything about the fact whether Philips/the administrator have a case against Juskiewicz and Berryman or not.

[OldManC]

None of this says anything about the fact whether Philips/the administrator have a case against Juskiewicz and Berryman or not.

Exactly.

[uwe]

It's a classic scenario, as an administrator the creditors expect you to go after the old management. If you don't, they will argue dereliction of fiduciary duties AND GO AFTER YOU. No one will blame you if a case such as this one against the former management is lost - blame the court or the attorneys or that there just wasn't enough proof -, but if you don't do it you'll be bound to hear at every creditors' meeting: "Now why exactly aren't we going after ...".

[Dave W]

Thanks, Rob.