Bankruptcy Judge Moves Patriot Coal’s Case to Missouri

Upon the urging of a miner’s union, a New York U.S. Bankruptcy Court Judge has moved the proceedings for Patriot coal to St. Louis, Missouri.

Patriot had hoped to keep their case in New York, which is the setting of many corporate bankruptcies and is also the home of their bankruptcy attorneys and trustees, according to Reuters.

But the United Mine Workers of America wanted the trial held closer to Patriot’s home-base in West Virginia so they can participate in the bankruptcy trial, and protect the interest employees who stand to lose wages, pensions and benefits.

The union did not specify where they wanted the trial relocated; asserting Patriot had few assets in New York.  The judge decided to move the trial to St. Louis where Patriot is headquartered.

This past July, Patriot Coal filed for Chapter 11 reorganization, citing a decline in demand for coal over cheaper natural gas. Regulations are also strangling the coal industry, but cleaner coal has become necessary to protect the health of people and the environment as a whole.

Upon entering bankruptcy Patriot Coal has $3.57 billion in assets with debts totaling $3.07 billion; they were also forced to lay-off 1,000 employees.

In the changing world of business and as new innovations arise, some companies face serious budget shortfalls. They can get so deep in the red that bankruptcy may be their only way to shed some of their debts and get their finances back on track.

After consulting with a bankruptcy lawyer, a troubled company will be able to decide which structure is in line with their finances and will facilitate a speedy return to solvency.