Court trustee requesting liquidation for Rosecroft

August 31, 2010|By Hanah Cho, The Baltimore Sun

The trustee for the U.S. Bankruptcy Court's Greenbelt division is asking that the bankruptcy proceedings for the closed Rosecroft Raceway be converted from a reorganization to a liquidation.

In a motion filed last week, W. Clarkson McDow Jr. said Chapter 7 bankruptcy for the harness track is in the best interest of creditors and the estate. Under Chapter 7, a debtor's nonexempt property are sold and the proceeds are distributed to creditors.

The harness track in Prince George's County filed for bankruptcy protection in June 2009 and closed its doors on July 1 after running out of money to operate.

McDow cited several reasons for his request, including Rosecroft owner, Cloverleaf Enterprises Inc., not honoring its fiduciary duties and continuing to lose money and the unlikelihood of reorganization.

If the bankruptcy court believes Rosecroft should remain under Chapter 11, McDow is requesting that a trustee be appointed for the case.

Real estate developer Mark Vogel, a former owner of the track, entered into a deal to buy the track, but the plan was rejected by the bankruptcy judge earlier this year. Vogel has until the end of Wednesday to submit a new plan, which he has said he would do.

Kelley Rogers, president of Cloverleaf, said Tuesday that he hopes to avoid liquidation.

"The burden is on Cloverleaf to get a sales deal approved by the court," said Rogers, noting other potential buyers have also expressed interest in the racetrack.

A hearing has been scheduled for Oct. 7.

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