U.S. Trustee files objection to Winn-Dixie plan of reorganization

By Jennifer Lanning Drey

Eugene, Ore., Sept. 25 - U.S. Trustee Felicia S. Turner filed an objection to Winn-Dixie Stores, Inc.'s plan of reorganization, according to a Monday filing with the U.S. Bankruptcy Court for the Middle District of Florida.

In the filing, the trustee said she objects to the plan's release provisions, which she believes are not fair or necessary to Winn-Dixie's reorganization.

According to the filing, the releases apply to Winn-Dixie's non-debtor subsidiaries and their employees, Wachovia and its advisers and the creditors committee and its advisers. The releases include all claims, obligations, suits, judgments, debts and liabilities in connection with Winn-Dixie and the plan.

The releases place an improper injunction on claim holders to pursue certain actions, the trustee said in the filing.

The trustee also objected to the plan's allowance of professional fees for professionals who have not been approved by the court, filed an application stating the legal basis for their recovery, and allowed the court to review their fees.

Winn-Dixie, a Jacksonville, Fla., supermarket company, filed for Chapter 11 on Feb. 21, 2005 in the U.S. Bankruptcy Court for the Southern District of New York. The case was later transferred to the U.S. Bankruptcy Court for the Middle District of Florida. Its Chapter 11 case number is 05-03817.

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