Syntax-Brillian creditors committee objects to shareholder motion to remove bankruptcy judge

By Jennifer Lanning Drey

Portland, Ore., Dec. 22 - Syntax-Brillian Corp.'s official committee of unsecured creditors objected to shareholder Ahmed Amr's motion that bankruptcy judge Brendan Shannon discontinue presiding over the company's bankruptcy case.

In a Monday filing with the U.S. Bankruptcy Court for the District of Delaware, the committee argued there is no suggestion judge Shannon's prior engagement as local counsel to Silver Point Finance LLC more than two years ago was in any manner related to the Syntax-Brillian case.

Silver Point is Syntax-Brillian's debtor-in-possession lender.

The committee said Amr's alleged association between judge Shannon and Syntax-Brillian consultant FTI Consulting Inc. and Gregory Rayburn is "even more attenuated."

"Any attorney who leaves private practice to take the bench is likely to have dozens or even hundreds of former clients who are involved in some capacity in cases before the court," the committee said.

"If recusal were mandated in every such instance the court could not function."

The committee also noted that every dollar spent addressing Amr's complaints in the cases is being diverted from potential unsecured recoveries.

As previously reported, Amr claimed Shannon's prior associations with Silver Point and FTI appear to have influenced the proceedings thus far.

The shareholder said Shannon's bias in the proceedings has delayed and limited discoveries and narrowed the scope of examinations.

Specifically, he said the judge has not allowed the formation of a shareholders committee and has not authorized any probe into illegal trading.

Additionally, Amr said even when fraud was uncovered, Syntax-Brillian and chief executive officer Rayburn were not held accountable for their role in covering up the fraud.

A hearing is scheduled for Jan. 7.

Syntax-Brillian is a Tempe, Ariz.-based designer, developer and distributor of LCD HDTVs, digital cameras and microdisplay entertainment products. The company filed for bankruptcy on July 8. Its Chapter 11 case number is 08-11407.

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