Mediation attempts to settle Pacific Lumber’s bankruptcy issues have failed, sending the matter back to the courts, according to the San Francisco Chronicle.
Pacific Lumber unveiled a plan in October to sell approximately 29,000 acres of its best redwoods for $600 million to help with the company’s reorganization. Creditors disputed that the trees were not worth so much -- the court then ordered the two sides meet with a mediator to work out a compromise.
Pacific Lumber filed for bankruptcy in January in Texas after the company failed to make a payment on about $714 million in bonds. That debt is traced back to a 1986 acquisition of the Humboldt County logging company by Pacific Lumber’s parent company Maxxam Corp.
The question before federal Bankruptcy Court Judge Richard Schmidt of Corpus Christi, Texas, is whether to turn control of Pacific Lumber’s 200,000 acres of redwood forest over to Maxxam Corp. or its creditors.