MGF Sourcing Turns Over $ 16M Claim Against RTW Retailwinds to Contrarian Funds LLC
January 5, 2021, New Jersey – Contrarian Funds LLC, an investment research firm and experts in distressed investing, recently bought a $16.5 million claim in the RTW Retailwinds, Inc. bankruptcy case.
MGF Sourcing, Inc. is a global sourcing company, specializing in apparel, footwear, accessories, and other household goods. MGF Sourcing Inc. had a claim of $16,536,184.91 against one of the Debtors, Lerner New York, Inc. This claim is also listed in the Debtor’s Schedule F under Case No. 20-18448.
As an alternative to waiting through the lengthy bankruptcy claims process with prolonged court litigation, some creditors opt to monetize their claim in return for immediate cash through “Claims Trading”.
In Claims Trading, a creditor sells and transfers its ownership in a bankruptcy claim to another entity, to receive immediate monetary payment from the buyer of its claim. As a result, the official claim to the debt is recorded with the bankruptcy court and legally transferred to the buyer, who subsequently takes on the risk of recovering payment from the Debtor.
Some of the large claims against RTW Retailwinds and its affiliates thus far include : $44,991,803.00 from Susie Sanchez as Class Representative, $173,846,400.00 from California Labor & Workforce Development Agency, 16,983,069.00 by Ackermann & Tilajef, PC, $12,716,046.00 from Wells Fargo Bank, $1,267,790.22 by Allied Printing, $5,747,165.60 by Windstream and $4,969,583.09 by Amoseastern Apparel Inc.
The Debtors’ cases are pending before the Honorable Judge John K. Sherwood and are jointly administered under Case No. 20-18445. The law firm of Cole Schotz P.C is representing the Debtors in the bankruptcy case.