Cases
CourtFilingsPetition dateMore filters
The court approved THG’s combined disclosure statement and confirmed the joint chapter 11 liquidation plan, resolving objections from LS Biotech 8, Health Care Services Corporation, the United States and the U.S. Trustee as settled, withdrawn or overruled. Classes 3, 4 and 5 voted; Classes 1 and 2 were unimpaired, while subordinated claims and equity were left with no recovery source filing.
The confirmed plan moves remaining value into a Liquidating Trust administered by Andrews Advisory Group, LLC as Liquidating Trustee. The trust takes the Liquidating Trust Assets, establishes reserves for administrative, priority, fee and disputed general unsecured claims, and receives standing to pursue estate causes of action, including Medicare-related appeals and claims. The treatment table projects 3%-7% recoveries for prepetition senior obligation claims, less than 1% for second-lien claims, and less than 1% for general unsecured claims through Series C trust interests tied to 10% of net litigation proceeds; equity is cancelled source filing.
THG Holdings LLC and its affiliate debtors filed chapter 11 in Delaware on July 30, 2019, with the operating story centered on True Health Diagnostics’ lab platform. Day-one declarations describe an independent diagnostic-services business with facilities in Richmond, Virginia and Frisco, Texas, more than 400 tests, roughly 1,370 daily samples, service to about 1,250 physician offices across 46 states and D.C., 319 employees, and approximately 450 phlebotomist vendors. The debtors said funded and trade obligations exceeded $174 million, including $150 million of long-term debt, a $2.5 million revolver, and about $14 million of accounts payable. source filing source filing source filing
The filing followed a two-year Medicare cash squeeze that management said became fatal in summer 2019. CMS imposed a 100% payment hold in May 2017, reduced it to 35% in June 2017, then imposed another 100% suspension on June 13, 2019, with about $21 million of receivables still trapped. Qlarant then sent July 5, 2019 overpayment notices asserting $19.76 million and $7.71 million of extrapolated overpayments, and the debtors lost their effort to enjoin CMS in the Eastern District of Texas on July 22. First-day papers said the only viable bridge was DIP financing of up to $3.574 million on an interim basis and $7.847 million on a final basis to keep payroll, vendors, and a sale process intact. source filing source filing
Loading defined terms…