In re Wang Laboratories, Inc.

149 B.R. 1 (1992)

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In re Wang Laboratories, Inc.

United States Bankruptcy Court for the District of Massachusetts
149 B.R. 1 (1992)

Facts

Wang Laboratories, Incorporated (Wang) (debtor) filed for bankruptcy in 1992. The bankruptcy was complex, and the bankruptcy proceeding generated 15 binders of documents in the bankruptcy court within the first three months after Wang filed its bankruptcy petition. Morton Salkind, one of Wang’s roughly 70,000 shareholders, asked the United States bankruptcy trustee to appoint a committee of equity securityholders to represent the interests of Wang’s shareholders in the bankruptcy proceeding. The trustee denied Salkind’s request because Wang was insolvent, as evidenced by financial disclosures indicating that Wang had a negative equity of more than $400 million. The trustee asserted that there was no interest to be represented by an equity committee and, therefore, appointing a committee would be inappropriate. Salkind challenged the trustee’s decision and asked the bankruptcy court to appoint the committee. Salkind argued that Wang was still operational, though operating at a loss, and that shares of Wang were still actively trading on the American Stock Exchange at a value greater than zero. The bankruptcy judge orally granted Salkind’s motion to appoint a committee after a hearing and then issued a supplemental written decision.

Rule of Law

Issue

Holding and Reasoning (Hillman, J.)

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