Buffets creditors object to property auction

By Sheri Kasprzak

New York, March 10 – Creditors of Buffets LLC object to the company’s planned auction of property, according to a motion filed March 10 in the U.S. Bankruptcy Court for the Western District of Texas San Antonio Division.

The company, which reentered Chapter 11 bankruptcy earlier this month after emerging in July 2012, seeks to retain and pay Auction Nation, LLC and auction off certain property, including furniture, fixtures and equipment at certain of its locations.

Cole BU Portfolio II, LLC and ARC DBPPROP001, LLC, landlords on certain properties leased by Buffets, object to the auction.

“The landlords object to the proposed liquidation auctions described in the motion and the debtors’ actual conduct of such sales because the relief sought by the motion relating to the foregoing blatantly and egregiously violate the landlords’ due process rights,” the motion said.

“Fundamental concepts of due process require that ‘notice must be reasonably calculated to apprise interested parties of the pendency of an action and to afford them an opportunity to present objections’.”

The landlords contend in the motion that they learned March 9 that the liquidation auctions were being conducted that day and would conclude that day.

“Landlord’s alerted their ... counsel who, in turn, immediately contact debtors’ counsel and were eventually advised that the auctions were in fact occurring and a motion would be forthcoming to seek approval of such sales,” the motion said.

“The motion was eventually filed mid-afternoon yesterday [March 9], and a hearing was set, at the debtors’ request for today [March 10] at 10 a.m. [Central Time].”

Complicating matters, ARC has certain purchase option rights under a 2006 lease agreement, the motion noted.

Headquartered in Hollywood Park, Texas, Buffets operates a chain of buffet-style restaurants, including Old Country Buffet, Country Buffet, HomeTown Buffet, Ryan’s, Ryan’s Family Steakhouse, Fire Mountain, Granny’s, Tahoe Joe’s Famous Steakhouse, Soup ‘N Salad Unlimited, Roadhouse Grill, JJ North’s Grand Buffet and Ovation Brands. The company reentered Chapter 11 on March 7 under the case number 16-50557.

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