Tommy's Boats: Trustee-Led Liquidation After Dealer Dispute

Tommy's Fort Worth, LLC and 16 affiliated debtors filed chapter 11 on May 20, 2024, in the U.S. Bankruptcy Court for the Northern District of Texas. The company, a recreational power-boat dealer that operated 14 dealerships across eight states and generated $190.2 million in revenue for fiscal year 2023, entered the case after a dispute with its principal boat manufacturer, Malibu Boats, and a $105 million floorplan debt owed to M&T Bank. Within weeks, the court approved the appointment of a chapter 11 trustee, shifting the case from debtor control to an independent administration that would ultimately pursue a liquidating plan.

The trustee-led case moved through asset liquidation sales, a $3.5 million settlement with Malibu Boats, and a confirmed plan of liquidation. The confirmation order entered on July 24, 2025, and the plan went effective on August 26, 2025. The filing listed $100 million to $500 million in liabilities. Affiliate cases were closed by final decree in January 2026, while the lead case remains open for claims reconciliation. Malibu, which had counted Tommy's as its largest national dealer, reported a 2.6% decline in net sales and a 9.0% drop in unit volume for fiscal year 2025, citing dealer inventory reduction efforts and ongoing litigation costs tied in part to the Tommy's Boats fallout.

Debtor(s)	Tommy's Fort Worth, LLC (17 jointly administered entities)
Court	U.S. Bankruptcy Court, Northern District of Texas (Amarillo Division)
Case Number	24-90000
Petition Date	May 20, 2024
Judge	Hon. Edward Morris
Confirmation Date	July 24, 2025
Claims Agent	Omni Agent Solutions

Malibu Dispute, Floorplan Debt, and Prepetition Distress

Tommy's Boats was founded in Denver in 1981 by Wakeboard Hall of Fame member Tommy Phillips and was later acquired by Matthew Borisch and members of his family. The company sold Tahoe, Malibu, and Axis boats across a multi-state dealer network. Beyond boat sales, the First Day Declaration describes revenue streams from service and repair, boat rentals through five rental programs, on-the-water fueling and docking, and retail apparel sales through branded "Tommy's Pro Shops" locations. The declaration describes the business as highly seasonal, with the busiest period running from April through June. Boat sales represented the large majority of total revenue.

At filing, Tommy's listed assets of $1 million to $10 million and liabilities of $100 million to $500 million. The 30 largest unsecured claims totaled nearly $123.6 million, with M&T Bank holding the largest claim at more than $105 million. Other creditors included Mercantile Bank at $4.7 million, Avalon & Tahoe Manufacturing at approximately $146,000, and Orion Construction at roughly $127,000.

Malibu relationship. The First Day Declaration says Tommy's had been Malibu's largest national dealer for roughly 12 years and accounted for about one-third of Malibu's power boat sales. Management alleged that Malibu pushed the company to expand floorplan capacity and carry higher-priced inventory, that M&T's floorplan debt rose to about $105 million when management believed it should have been closer to $40 million, and that Malibu failed to pay more than $12 million in incentives, rebates, and interest coverage. The declaration also pointed to a discovered $4.8 million sales-tax issue and lost carry-interest support that averaged about $1 million per month. The filing also listed approximately $5 million in unpaid sales taxes across several states.

Tommy's separately sued Malibu in April 2024, alleging that Malibu CEO Jack Springer conducted a scheme to supply "nearly $100 million of its highest priced, highest margin, slow moving boat inventory" to Tommy's 15 dealerships. The lawsuit accused Malibu of breach of contract, unjust enrichment, misrepresentation, and fraud.

Securities class action. Malibu's dealings with Tommy's also drew scrutiny from securities plaintiffs. An amended complaint filed in the Southern District of New York alleged that Malibu executives engaged in a channel-stuffing scheme to artificially inflate sales and stock prices by forcing excess inventory onto dealers, a strategy that plaintiffs claimed contributed to the financial collapse of Tommy's Boats and subsequent declines in Malibu's financial performance and stock value. Malibu later reported a net loss of $5.1 million for the first quarter of fiscal 2025, driven in part by a 32.9% decline in net sales amid the retail downturn and litigation costs.

Prepetition receivership. The debtors alleged in the First Day Declaration that a receivership period before the filing damaged value: they said they were locked out of three stores with functioning service departments, service personnel resigned, and the receiver was liquidating inventory at discounted prices while heading into Memorial Day season.

Andrews Trusteeship and Asset Liquidation

The case shifted to trustee control early. On June 14, 2024, the court entered an order directing that a chapter 11 trustee be appointed after the company was denied use of M&T Bank's cash collateral to fund the case. Judge Edward Morris authorized the appointment of a chapter 11 trustee four days later. The order approving appointment entered on June 18, 2024, installing Mark E. Andrews as chapter 11 trustee. The application states that Andrews had more than 35 years of legal experience and was selected after consultation with debtor and M&T counsel. Andrews disclosed prior professional relationships with Aaron Kaufman and Monica Blacker but represented that he otherwise had no disqualifying connections under 11 U.S.C. section 321(a).

The trustee subsequently pursued asset monetization across the dealership network. The court approved a wind-down consulting agreement with Mark Wells, a former Tommy's Boats executive who held both sales and business development roles, to assist with liquidation of watercraft inventory, lease assignments, sale of dealer operations and related property, and other wind-down tasks. Lydia Webb, an attorney at Gray Reed representing Andrews, stated during the hearing that Wells "has considerable experience in the debtors' industry, and his contacts have helped the trustee with his task of maximizing value for the debtors' estates." In prior filings, Andrews said he had made "great strides" to monetize Tommy's Boats' assets, including conducting inventory liquidation sales for hundreds of boats.

Wells received compensation of $46,513 over an initial six-week period plus $375 per hour thereafter, along with commissions of 4% on non-watercraft transactions and 2% on watercraft sales.

The trustee also initiated adversary proceedings to recover value for the estates. Court records show the trustee filed a lawsuit against Sun Valley to recover money or property, part of a broader effort to marshal assets beyond the dealership liquidation sales.

Cash Collateral and M&T Adequate Protection

The debtors filed an emergency cash collateral motion on May 22, 2024, and the court entered an interim order on May 24, 2024 before entering a final cash collateral order on July 17, 2024.

The final order authorized the chapter 11 trustee to use cash collateral subject to a four-week budget, weekly reporting, and a 105% permitted-variance cap on disbursements during each measurement period, excluding certain professional-fee and U.S. Trustee payment items from the variance calculation. As adequate protection, the secured lender received replacement liens on substantially all pre- and post-petition collateral and superpriority administrative claims under section 507(b), both subject to a carve-out for estate professional fees. The order also gave the creditors' committee a $25,000 investigation budget to review the secured lender's liens and potential estate claims.

The final order set default-based termination mechanics: after an event of default and termination notice, cash-collateral authority would end five business days later unless the trustee or committee obtained court relief. It also restricted out-of-ordinary-course asset transfers without the lender's consent.

Malibu Boats $3.5 Million Settlement

By fall 2024, the trustee had negotiated a settlement with Malibu Boats. The trustee's settlement motion and supporting declaration stated that Malibu agreed to pay $3.5 million in cash to the debtors' estate, release Malibu's own claim against the estates, assume the Knoxville lease, and pay cost value for inventory, merchandise, and FF&E at that location. Malibu also withdrew a $9.6 million unsecured claim against the company.

The trustee described the settlement as a resolution of disputes over unpaid incentives, lost business from non-renewed dealership agreements, and related litigation risk. He said the estates faced uncertainty, expense, and delay if they continued litigating with Malibu, especially given sales-out-of-trust issues and the broader liquidity crisis. The settlement details were also filed with the SEC and signed by Malibu Boats CEO Steven Menneto. As a condition of the settlement, the trustee agreed to seek a court order to prevent Borisch from pursuing lawsuits against Malibu and its affiliates — Borisch, according to Andrews, "has his own agenda" regarding claims against Malibu.

The settlement later became a plan condition precedent: the disclosure statement made the Malibu settlement payment a gating requirement for the plan effective date.

Stay enforcement against Borisch. The trustee's effort to prevent Borisch from pursuing personal claims against Malibu and M&T Bank led to contested litigation over ownership of those causes of action. In a May 2025 memorandum opinion, the bankruptcy court considered whether the claims Borisch asserted in separate litigation constituted property of the bankruptcy estates and therefore violated the automatic stay. The court's analysis addressed the boundary between estate claims and individual claims held by Borisch as owner of the debtor entities, a question that bore directly on the enforceability of the settlement's mutual release structure.

Liquidating Plan and Creditor-Trust Structure

The trustee's plan was a liquidating chapter 11 plan. The disclosure statement described plan reserves funded from contributed cash collateral that would pay administrative, priority, and specific customer claims, while other assets and causes of action transferred into a creditor-trust and lender structure.

The disclosure statement identified four key reserves:

Reserve	Amount
Administrative claims reserve	$500,000
Priority claims reserve	$1.75 million
Customer constructive claims reserve	$360,000
Creditor-trust reserve	$350,000

Class 4 customer constructive trust claims were impaired and estimated to recover roughly 23% to 45%. Class 5 general unsecured claims were impaired and estimated to recover about 1%.

The disclosure statement explained that plan reserves would be funded from contributed cash collateral, while remaining assets and causes of action — including retained claims against insiders — would transfer into the creditor-trust structure for post-confirmation pursuit and distribution.

The modified plan provided that M&T would receive releases from the trustee and from creditors or parties in interest who did not opt out of the proposed settlement structure. Exculpation ran for the trustee and committee parties. Claims against insiders, including Borisch and related entities, were expressly retained rather than released.

U.S. Trustee Release Objection and Plan Confirmation

The U.S. Trustee's Office challenged the plan's third-party releases, arguing they contained nonconsensual provisions that violated the Bankruptcy Code and the U.S. Supreme Court's Purdue Pharma ruling. The objection placed the case within the broader post-Purdue debate over the permissible scope of nondebtor releases in chapter 11 plans, an issue that has prompted U.S. Trustee challenges across multiple jurisdictions since the Supreme Court's 2024 decision.

The modified plan was filed on May 1, 2025. Judge Edward Morris approved the plan on July 24, 2025, overruling objections from Borisch. The confirmation order found that Classes 2, 4, and 5 accepted the plan, while other impaired classes were confirmed through cramdown findings. The court approved the plan's injunction, release, and exculpation provisions and found the class-level settlement structure fair and equitable. For Class 4, the court described the plan as providing a meaningful settlement opportunity for a difficult category of customer claims. For Class 5, the court recognized a 1% estimated recovery and found it fair because the alternative absent the settlement structure would have been no recovery.

Post-confirmation status. On August 26, 2025, the trustee filed a notice of effective date stating that all conditions precedent to effectiveness had been satisfied or waived by M&T Bank. On January 27, 2026, the court entered a final decree closing the affiliate cases but not the lead case. The lead Tommy's Fort Worth, LLC case remains open for outstanding claims administration and related retained matters.

By February 2026, the creditor trustee moved to extend the claims-objection deadline from February 22, 2026 to May 22, 2026, stating that approximately 65 priority claims and about 700 nonpriority general unsecured claims still required reconciliation. The motion noted that many duplicate or already-paid claims were better addressed through administrative resolution rather than objection litigation.

Malibu securities litigation. Separate from the bankruptcy, Malibu Boats faced a securities class action in the Southern District of New York arising from the same dealer-relationship collapse. In July 2025, the Retiree Benefit Trust of the City of Baltimore and other plaintiffs reached a $7.8 million settlement with Malibu and its executives, resolving allegations of materially false and misleading statements regarding the company's financial performance and dealer network health. The settlement, which was pending preliminary court approval, underscored the broader market consequences of the Tommy's Boats collapse for Malibu's investors.

Key case timeline

Date	Event
May 20, 2024	Tommy's Fort Worth and affiliates filed chapter 11
May 24, 2024	Interim cash collateral order entered
June 14, 2024	Court directed appointment of chapter 11 trustee
June 18, 2024	Court approved appointment of Mark E. Andrews as chapter 11 trustee
July 17, 2024	Final cash collateral order entered
October 7, 2024	Trustee filed Malibu settlement motion
March 28, 2025	Disclosure statement filed
May 1, 2025	Modified plan filed
July 24, 2025	Court confirmed trustee's plan
August 26, 2025	Plan effective date
January 27, 2026	Affiliate cases closed by final decree
February 12, 2026	Creditor trustee sought extension of claims-objection deadline to May 22, 2026

Frequently Asked Questions

What happened to Tommy's Boats?

Tommy's Fort Worth, LLC and 16 affiliated debtors filed chapter 11 on May 20, 2024, after disputes with manufacturer Malibu Boats and $105 million in floorplan debt owed to M&T Bank. A chapter 11 trustee was appointed in June 2024, and the trustee pursued a liquidating plan that was confirmed on July 24, 2025 and went effective on August 26, 2025.

Who is the claims agent for Tommy's Boats?

Omni Agent Solutions serves as the claims and noticing agent. The firm maintains the official claims register and distributes case notifications to creditors and parties in interest.

What will creditors receive under the Tommy's Boats plan?

The disclosure statement estimated that Class 4 customer constructive trust claims would recover roughly 23% to 45%, while Class 5 general unsecured claims would recover about 1%.

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