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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Amendment No. 3
to
SCHEDULE 13D
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Under the Securities Exchange Act of 1934
(Amendment No. 3)*
Bucyrus International, Inc.
(Name of Issuer)
Common Stock, $.01 par value per share
(Title of Class of Securities)
118902105
(CUSIP Number)
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J. Andrew Rahl, Jr. Esq.
Anderson Kill & Olick, P.C.
1251 Avenue of the Americas, New York, NY 10020-1182
(212) 278-1469
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
July 31, 1997
(Date of Event which Requires Filing of this Statement)
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If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ].
Check the following box if a fee is being paid with the statement [ ]. (A fee is
not required only if the reporting person: (1) has a previous statement on file
reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7.)
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Note: Six copies of this statement, including all exhibits, should be filed with
the Commission. See Rule 13d-1(a) for other parties to whom copies are to be
sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter disclosure
provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
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SCHEDULE 13D
CUSIP No. 118902105
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Jackson National Life Insurance Company
38-1659835
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
3. SEC USE ONLY
4. SOURCE OF FUNDS*
Conversion of pre-bankruptcy debt and equity obligations to
post-bankruptcy equity in reorganized Issuer pursuant to a
Plan of Reorganization. (00).
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
6. CITIZENSHIP OR PLACE OR ORGANIZATION
Michigan
NUMBER OF 7. SOLE VOTING POWER
SHARES 4,228,382
BENEFICIALLY 8. SHARED VOTING POWER
OWNED BY 4,228,382
EACH 9. SOLE DISPOSITIVE POWER
REPORTING 4,228,382
PERSON 10. SHARED DISPOSITIVE POWER
WITH 4,228,382
11. AGGREGATE AMOUNT BENEFICIALLY OWED BY EACH REPORTING
PERSON - 4,228,382
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* [ ]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
40.14%
14. TYPE OF REPORTING PERSON*
Life Insurance Company (IC)
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE AND THE SIGNATURE
ATTESTATION
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SCHEDULE 13D
CUSIP No. 118902105
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
PPM America, Inc.
36-3714794
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
3. SEC USE ONLY
4. SOURCE OF FUNDS*
Conversion of pre-bankruptcy debt and equity obligations to
post-bankruptcy equity in reorganized Issuer pursuant to a
Plan of Reorganization. (00).
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
6. CITIZENSHIP OR PLACE OR ORGANIZATION
Delaware
NUMBER OF 7. SOLE VOTING POWER
SHARES 4,228,382
BENEFICIALLY 8. SHARED VOTING POWER
OWNED BY 4,228,382
EACH 9. SOLE DISPOSITIVE POWER
REPORTING 4,228,382
PERSON 10. SHARED DISPOSITIVE POWER
WITH 4,228,382
11. AGGREGATE AMOUNT BENEFICIALLY OWED BY EACH REPORTING
PERSON - 4,228,382
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* [ ]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
40.14%
14. TYPE OF REPORTING PERSON*
Investment Adviser (IA)
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE AND THE SIGNATURE
ATTESTATION
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AMENDMENT NO. 3 TO SCHEDULE 13D
This Amendment relates to the Schedule 13D dated December 23,
1994 ("Original Schedule 13D"), as amended by Amendment No. 1 thereto dated
April 10, 1995 ("First Amendment") and Amendment No. 2 thereto dated April 18,
1996 ("Second Amendment"), each filed by Jackson National Life Insurance Company
("JNL") and PPM America, Inc. ("PPM America") relating to the common stock, par
value $.01 per share ("Common Stock"), of Bucyrus International, Inc. (the
"Issuer"). Notwithstanding this Amendment No. 3, the Original Schedule 13D, the
First Amendment and the Second Amendment speak as of their respective dates. All
capitalized terms used but not otherwise defined in this Amendment have the
meanings given to them in the Original Schedule 13D.
ITEM 4. PURPOSE OF TRANSACTION.
Item 4 of the Original Schedule 13D, as amended by the First
Amendment and Second Amendment, is hereby amended and restated in its entirety
as follows:
Except as otherwise described herein, the reporting persons
acquired the shares of Common Stock described in Item 5 below for investment
purposes.
Except as otherwise described herein, the reporting persons
presently do not intend to acquire additional shares of Common Stock in the open
market or through privately negotiated transactions.
The reporting persons may in the future seek in open market or
privately negotiated transactions to acquire additional shares of Common Stock
or to dispose of all or a portion of Common Stock covered by this Schedule 13D.
The reporting persons may from time to time consider or discuss with third
parties the disposition of some or all of such shares of Common Stock. In making
any decision whether to acquire or dispose of shares of Common Stock, in
addition to the other considerations discussed herein, the reporting persons
will consider various factors, including, among other things, the Issuer's
financial condition, business and prospects, the price at which such securities
are trading and the nature of other opportunities available.
As disclosed in the Issuer's press release dated July 31,
1997, American Industrial Partners Capital Fund II, L.P. (or an affiliated
entity) (the "AIP Purchaser") has entered into a letter of intent with the
Issuer, providing for the acquisition of the Issuer by the AIP Purchaser. Under
the terms of the letter of intent (the "AIP Offer"), the AIP Purchaser would
acquire all of the shares of Common Stock of the Issuer at a
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price of $18 per share. The transaction is subject to customary contingencies,
including the execution of a definitive agreement, financing, and shareholder,
board of directors and regulatory approvals. The AIP Offer contemplates the
execution by JNL of a stockholder agreement pursuant to which JNL will agree to
tender all of the shares of Common Stock held by it to the AIP Purchaser in the
tender offer and will grant to the Purchaser an option to purchase all of such
Shares at an exercise price equal to the offer price. The option would be
exercisable in certain circumstances to be enumerated in the definitive
stockholder agreement, including upon termination of the merger agreement, and
would remain exercisable for a period of time thereafter, to be mutually agreed.
In the event that an entity other than the AIP Purchaser acquired a majority of
the outstanding Shares at a price higher than the offer price pursuant to an
agreement signed within such period, the AIP Purchaser and JNL would share 50/50
in the amount by which the price in such other acquisition exceeded the offer
price. The reporting persons presently support such proposed transaction in
principle. The reporting persons believe that the terms of the proposed
transaction will allow JNL to continue to pursue its pending actions against
Mikael Salovaara, the South Street group of investment funds, Milbank, Tweed,
Hadley & McCloy and others with respect to the Issuer.
In addition, the reporting persons continue to anticipate that
JNL may acquire additional shares of Common Stock pursuant to the terms of the
Plan. As discussed in Item 3 of the Original Schedule 13D, pursuant to Section
3.09(b)(ii) of the Plan, any recovery of cash or property obtained by or on
behalf of the Issuer with respect to any Cause of Action against a Non- Released
Person which arose prior to February 18, 1994 shall constitute a distribution on
JNL's claim as the holder of the Bucyrus Resettable Senior Notes. Accordingly,
pursuant to Section 3.09(b)(ii) of the Plan, JNL may be entitled from time to
time after the date of this filing to receive additional shares of Common Stock.
Specifically, JNL is vigorously pursuing as a representative of Holdings' and
Bucyrus' bankruptcy estates claims, rights and Causes of Action against South
Street Corporate Recovery Fund I, L.P., South Street Leveraged Corporate
Recovery Fund, L.P., South Street Corporate Recovery Fund I (International),
L.P., Greycliff Partners, Ltd. and their respective successors, predecessors and
other related parties, including Mikael Salovaara and Alfred Eckert, each in its
or his capacity as a Non-Released Person ("Claims Against Non-Released
Persons"). At this time, the reporting persons believe it is premature and
speculative to estimate the number of shares which would be received by JNL if
JNL were to be wholly or partially successful in pursuing such claims.
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JNL is also presently continuing to pursue in the Bankruptcy
Court a claim under Section 503(b) of the Bankruptcy Code for the recovery of
approximately $3.311 million in actual, necessary professional legal and
financial advisory fees and out of pocket expenses incurred by JNL in making a
substantial contribution in the Proceedings ("503(b) Claim"). Pursuant to a
settlement agreement dated May 23, 1995, JNL agreed that, in the event that the
JNL 503(b) Claim is allowed in whole or in part by the Bankruptcy Court, JNL
will accept payment in Common Stock at a price equal to $5.6375 per share in
lieu of requiring payment of any award in cash. By order dated June 3, 1996, the
Bankruptcy Court ruled that JNL would be awarded the sum of $500. JNL appealed
the decision to the United States District Court for the Eastern District of
Wisconsin. On June 26, 1997, the District Court returned the matter to the
Bankruptcy Court for further proceedings. On July 11, 1997, JNL moved the
Bankruptcy Court for relief from the final judgment entered on the JNL 503(b)
Claim. At this time the reporting persons believe it is premature and
speculative to estimate the number of shares which would be received by JNL if
JNL were to be wholly or partially successful in pursuing its 503(b) Claim and
if the Issuer were to issue to JNL shares of Common Stock in lieu of cash.
In addition to discussions with the AIP Purchaser, from time
to time the reporting persons have discussed with the Issuer and/or unrelated
third parties opportunities to engage in extraordinary corporate transactions
involving the Issuer or the sale or transfer of a material amount of assets of
the Issuer or its subsidiaries. Subject to consummation of the transaction
contemplated by the AIP Offer, the reporting persons anticipate that they will
continue to explore such types of opportunities with respect to the Issuer.
On July 21, 1997, the Issuer entered into a definitive
agreement with Global Industrial Technologies, Inc. ("Global") to acquire (the
"Marion Acquisition") certain assets and liabilities of Global's subsidiary, The
Marion Power Shovel Company, and of certain subsidiaries and divisions of Global
that represent Global's surface mining equipment business in Canada, Australia,
and South Africa. The Issuer stated in its July 31, 1997 Press Release that the
transaction contemplated by the AIP Offer is not expected to have any effect on
its previously announced Marion Acquisition.
In connection with the Marion Acquisition, the Issuer obtained
a bridge loan commitment dated April 14, 1997 from the PPM America Special
Investments Fund, L.P., an affiliate of the reporting persons (the "PPM Fund")
("Bridge Loan Commitment") to provide a $45 million unsecured bridge loan (the
"Bridge Loan") to fund the purchase of the business and assets of Marion. Such
Bridge Loan Commitment anticipates that the maturity date of such Bridge Loan
would be 180 days from the closing date of such loan. To date, the Issuer has
not closed such Bridge Loan but the Issuer has an agreement in principle with
the AIP Purchaser that the Bridge Loan will close when and if the Issuer
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consummates the Marion Acquisition. The PPM Fund anticipates that one or more
other lenders may participate in such Bridge Loan.
The Bridge Loan Commitment contemplates that, in addition to
other customary fees and charges, the PPM Fund would receive at closing warrants
to purchase Common Stock of the Issuer. However, the actual terms of the Bridge
Loan will be reflected in final documentation which the parties are presently
negotiating.
The closing of such Bridge Loan and the issuance of any such
warrants is subject to a number of contingencies, including without limitation,
the negotiation, execution and delivery of definitive documentation for the
Bridge Loan, the closing of the Marion Acquisition and other contingencies
resulting from the recent AIP Offer. Furthermore, the AIP Offer or any other
event involving an acquisition of Common Stock of the Issuer may affect the
PPM Fund's willingness to receive any of its consideration for the Bridge Loan
in the form of warrants. As a result of all of the foregoing considerations,
the reporting persons believe it is premature and speculative at this time to
determine whether or not the PPM Fund will receive any shares of Common Stock
in connection with the Bridge Loan.
The reporting persons have discussed with the Issuer from time
to time various proposals for a recapitalization of the Issuer, including
without limitation, the possibility of obtaining financing from JNL, PPM, their
affiliates or third parties. Subject to the effects of the AIP Offer, the
reporting persons will continue to consider all appropriate capitalization
proposals affecting the Issuer.
The corporate governance issues described in paragraphs 5
through 11 of the Original Schedule 13D ceased to be applicable as of the annual
meeting of stockholders of the Issuer held April 30, 1997 (the "1997 Annual
Meeting"). On March 5, 1997, the Board, acting pursuant to Section 4.2 of the
Restated Bylaws of the Issuer, adopted a resolution establishing the number of
directors at seven, effective as of the date of the 1997 Annual
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Meeting. At such 1997 Annual Meeting, seven directors were elected to hold
office until the 1998 annual meeting of shareholders of the Issuer and until
their successors are duly elected and qualified. Effective April 30, 1997, the
Board of Directors of the Issuer appointed Armour F. Swanson as the Non-
Executive Chairman of the Issuer's Board of Directors, replacing F. John Stark
III, who continued to serve as a Director.
Of the directors elected at the 1997 Annual Meeting, Russell
W. Swansen and F. John Stark III were reelected. Such individuals are also
directors and officers of PPM, which is the investment advisor to JNL (the "JNL
Directors"). Accordingly, JNL or PPM may be deemed to have the ability to
influence the Issuer's Board of Directors and the JNL Directors may be deemed to
participate, together with other members of the Issuer's Board of Directors, in
the management of the Issuer. The JNL Directors, in their capacity as members of
the Board of Directors, will necessarily consider proposals from time to time
regarding the business and affairs of the Issuer, possibly including matters of
the nature enumerated in clauses (a) through (j), inclusive, of Item 4 of
Schedule 13D. If any such matter is presented to the Issuer's Board of
Directors, the JNL Directors intend to act thereon in accordance with their
business judgment at such time.
Consummation of the transactions contemplated by the AIP Offer
could result in a change in the present Board of Directors or management of the
Issuer. The terms of the AIP Offer may also, among other things, have the effect
of (i) impeding the acquisition of control of the Issuer by any person other
than the AIP Purchaser, (ii) causing the Issuer's Common Stock to be delisted
from a national securities exchange or cease to be authorized or quoted in an
inter-dealer quotation system of a registered national securities association,
or (iii) causing a class of equity securities of the Issuer to become eligible
for termination of registration pursuant to Section 12(g)(4) of the Securities
Exchange Act of 1934.
Except as aforesaid, neither JNL, PPM America, Brooke, PPM
Ltd. or Prudential, nor to the best of their knowledge, any of the directors or
executive officers of any of them, presently has plans or proposals which relate
to or would result in any of the matters enumerated in clauses (a) through (j),
inclusive, of Item 4 of Schedule 13D.
The reporting persons may take any other action with respect
to the Issuer and its securities in any manner permitted by law.
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ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
Item 5 of the Original Schedule 13D is amended to add the
following:
(a) Item 13 of the cover pages is incorporated herein by
reference. Item 13 has been amended to reflect that the percentage of shares of
Common Stock beneficially owned by each reporting person is 40.14% as a result
of the issuance of shares of Common Stock by the Issuer after the date of the
Original Schedule 13D.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR
RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER.
Item 6 of the Original Schedule 13D is hereby amended to add
the following paragraphs:
The disclosure provided in Item 4 hereof with respect to the
warrants to which the PPM Fund may be entitled in connection with the Bridge
Loan Commitment is incorporated in this Item 6 by reference.
The disclosure provided in Item 4 hereof with respect to the
AIP Offer is incorporated in this Item 6 by reference.
ITEM 7. EXHIBITS.
(1) Issuer's Press Release dated July 31, 1997.
(2) Press Release issued by the reporting persons
dated July 31, 1997.
(3) Letter of Intent, filed by reference herein to the
Issuer's Form 8-K filed August 4, 1997.
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this Statement is true,
complete and correct.
Date: August 5, 1997
JACKSON NATIONAL LIFE
INSURANCE COMPANY
By: /s/ F. John Stark, III
__________________________
Name: F. John Stark, III
Title: Attorney-in-fact
PPM AMERICA, INC.
By: /s/ F. John Stark, III
__________________________
Name: F. John Stark, III
Title: Senior Vice
President and
General Counsel
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STATEMENT OF DIFFERENCES
The section symbol shall be expressed as...................................'SS'
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Exhibit (1)
PRESS RELEASE
BUCYRUS INTERNATIONAL, INC.
(NASDAQ: BCYR)
FOR IMMEDIATE RELEASE
BUCYRUS INTERNATIONAL, INC.
TO BE ACQUIRED BY
AMERICAN INDUSTRIAL PARTNERS
South Milwaukee, Wisconsin, July 31, 1997... Willard R. Hildebrand,
President and CEO of Bucyrus International, Inc. ("Bucyrus"), announced today
that Bucyrus has entered into a letter of intent with American Industrial
Partners Capital Fund II, L.P. ("American Industrial Partners"), providing for
the acquisition of Bucyrus by American Industrial Partners or one of its
affiliates. Under the terms of the letter of intent, American Industrial
Partners would acquire all of the shares of Bucyrus at a price of $18 per share.
The transaction is subject to customary contingencies, including the execution
of a definitive agreement, financing, and shareholder, board of directors and
regulatory approvals.
Bucyrus stated that this transaction is not expected to have any effect
on its previously announced acquisition of The Marion Power Shovel Company.
Bucyrus is one of the world's leading manufacturers of large scale
surface mining equipment and a provider of aftermarket parts and services.
American Industrial Partners is a private investment partnership which
makes equity investments in public and privately held companies located
principally in the United States.
Contact: William R. Hildebrand, President and Chief Executive Officer or Daniel
J. Smoke, Vice President and Chief Financial Officer (414) 768-5375 or
(414) 768-5378
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Exhibit (2)
PPMWORLDWIDE
PPM America Supports Acquisition of Bucyrus International by American Industrial
Partners, But Reports It Will Continue Legal Action Against Milbank, Tweed,
Hadley and McCloy, & Mikael Salovaara Over Conflict of Interest Dealings in B-I
Bankruptcy; $1.8 Million in Legal Fees at Issue
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Chicago, Illinois, July 31, 1997 -- PPM America, Inc., on behalf of
Jackson National Life Insurance Company, as a principal shareholder of Bucyrus
International, Inc. ("B-I"), is pleased to announce that it supports in
principal the proposed acquisition of B-I by American Industrial Partners
Capital Fund, II, L.P.
PPM congratulates Frank Miller, Charles Macaluso, Willard Hildebrand
and the new Bucyrus management team for their success in maximizing Bucyrus'
shareholder value. PPM believes this success has been achieved in spite of what
Jackson views as the contrary efforts of Mikael Salovaara, the South Street
group of investment funds, Milbank, Tweed, Hadley & McCloy and others. PPM is
also pleased to announce that the terms of the proposed transaction will allow
Jackson to continue to pursue its pending legal actions against them. In this
regard, the Office of the United States Trustee filed motions earlier this week
with the United States Bankruptcy Court for the Eastern District of Wisconsin,
where Bucyrus' 1994 bankruptcy proceedings were conducted, seeking: (i) to
revoke the Court's order authorizing the employment of Milbank, Tweed, Hadley
and McCloy as counsel to Bucyrus; (ii) disgorgement of all legal fees and
expenses paid to Milbank; and (iii) sanctions against Milbank.
As has been widely reported, prosecutors in Milwaukee are looking into
the possibility that Milbank Tweed violated federal law by failing to disclose
its conflict of interest in representing both Bucyrus International and Mr.
Salovaara, one of the company's chief creditors during the B-I's reorganization
efforts. Milbank Tweed has made what press accounts have called "an
extraordinary confession" acknowledging the conflict. The New York law firm is
now fighting efforts by B-I to not only disgorge $1.8 million in legal fees but
also court-ordered sanctions in connection with its unprecedented double
representation of debtor and creditor. Jackson National Life is separately
engaged in litigation with Salovaara.
Jackson National Life currently has a 42% equity stake
in B-I.
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UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF WISCONSIN
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In Re: B-E Holdings, Inc. Case No. 94-20786-RAE
Bucyrus-Erie Company Case No. 94-20787-RAE
(Chapter 11 Proceedings)
(Debtors) Jointly Administered
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MOTION TO REVOKE ORDER AUTHORIZING EMPLOYMENT OF MILBANK, TWEED
HADLEY & McCLOY AS ATTORNEYS FOR THE DEBTOR
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Now comes the United States Trustee by John Robert Byrnes,
Assistant United States Trustee, who moves the Court for an Order revoking the
Order Authorizing the Employment of Milbank, Tweed, Hadley & McCloy by the
Debtor entered herein on the following grounds:
1. The Order was obtained as the result of material misrepresentations and
omissions in the affidavits and supplemental affidavits in support of
application for employment filed pursuant to FRBP 2016.
2. The affidavits filed in support of application for employment did not
comply with FRBP 2016 and as a result, employment was obtained contrary to
'SS' 327.
3. Milbank, Tweed, Hadley & McCloy was not a disinterested party either at the
time of its employment or thereafter and, as a result, was ineligible for
employment under 'SS' 327.
Dated this 25th day of July, 1997.
M. SCOTT MICHEL
UNITED STATES TRUSTEE
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JOHN ROBERT BYRNES
Assistant U.S. Trustee
John Robert Byrnes
Assistant U.S. Trustee
Office of the U.S. Trustee
517 E. Wisconsin Ave., Suite 430
Milwaukee, WI
Phone: (414) 297-4499
Fax: (414) 297-4478
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UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF WISCONSIN
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In Re: B-E Holdings, Inc. Case No. 94-20786-RAE
Bucyrus-Erie Company Case No. 94-20787-RAE
(Chapter 11 Proceedings)
(Debtors) Jointly Administered
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MOTION TO REQUIRE MILBANK, TWEED HADLEY & McCLOY
TO DISGORGE FEES AND EXPENSES
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Now comes the United States Trustee by John Robert Byrnes,
Assistant United States Trustee, who moves the Court for an Order requiring
Milbank, Tweed, Hadley & McCloy to disgorge all fees and expenses previously
ordered herein and who in support of said motion alleges as follows:
1. Milbank, Tweed, Hadley & McCloy was ineligible for employment for the
reasons stated in the Motion to Revoke Employment Order filed
contemporaneously with this motion and incorporated herein by reference.
2. The Order Authorizing Payment of Fees and Reimbursement of Expenses was
obtained as a result of fraud on the Court on the part of Milbank, Tweed,
Hadley & McCloy acting through its partner, John Gellene. Said fraud
consisted of affidavits in support of applications for employment filed on
behalf of Milbank, Tweed, Hadley & McCloy that were false and misleading
and similar testimony provided by Attorney Gellene in support of the
application for compensation and reimbursement of expenses filed on behalf
of Milbank, Tweed, Hadley & McCloy.
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3. That regardless of any benefit the services provided to the estate the
misconduct of Milbank, Tweed, Hadley & McCloy was so severe that
disgorgement of all fees and expenses is the only appropriate remedy.
Dated this 25th day of July, 1997.
M. SCOTT MICHEL
UNITED STATES TRUSTEE
----------------------
JOHN ROBERT BYRNES
Assistant U.S. Trustee
John Robert Byrnes
Assistant U.S. Trustee
Office of the U.S. Trustee
517 E. Wisconsin Ave., Suite 430
Milwaukee, WI
Phone: (414) 297-4499
Fax: (414) 297-4478
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UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF WISCONSIN
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In Re: B-E Holdings, Inc. Case No. 94-20786-RAE
Bucyrus-Erie Company Case No. 94-20787-RAE
(Chapter 11 Proceedings)
(Debtors) Jointly Administered
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MOTION FOR SANCTIONS
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Now comes the United States Trustee by John Robert Byrnes,
Assistant United States Trustee, who moves the Court for an Order imposing
sanctions against Milbank, Tweed, Hadley & McCloy on the grounds that Milbank,
Tweed, Hadley & McCloy violated FRBP 9011 in that the following documents were
signed and filed by Milbank, Tweed, Hadley & McCloy or its agents and that
said documents did not comply with said Rule:
1. Declaration Pursuant to FRBP 2014(a) and 2016(b) dated 2/18/94. Docket #3.
2. Supplemental Affidavit dated 3/29/94. Docket #175.
3. Application for Compensation and Reimbursement of Expenses dated 4/26/95.
Docket #1538.
4. Briefs in support of Applications for Compensation and Reimbursement of
Expenses dated 11/9/95. Docket #1878.
Dated this 25th day of July, 1997.
M. SCOTT MICHEL
UNITED STATES TRUSTEE
----------------------
JOHN ROBERT BYRNES
Assistant U.S. Trustee
John Robert Byrnes
Assistant U.S. Trustee
Office of the U.S. Trustee
517 E. Wisconsin Ave., Suite 430
Milwaukee, WI
Phone: (414) 297-4499
Fax: (414) 297-4478
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