UNITED STATES BANKRUPTCY COURT FOR THE NORTHERN DISTRICT OF ALABAMA SOUTHERN DIVISION. In re: Case No TOM7 NEW WEI, INC., et al.

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1 Main Document Page 1 of 5 UNITED STATES BANKRUPTCY COURT FOR THE NORTHERN DISTRICT OF ALABAMA SOUTHERN DIVISION In re: Case No TOM7 NEW WEI, INC., et al. Chapter 7 Debtor(s) CHAPTER 7 TRUSTEE S RESPONSE TO THOMAS J. LYNCH S MOTION TO AMEND OR ALTER (DOC. 3241) COMES NOW Andre M. Toffel (the Trustee ), duly appointed interim Chapter 7 trustee of the bankruptcy estates of the Debtors 1 associated with this jointly administered case, and in response to the Motion to Amend or Alter (the Motion to Amend Doc. 3241) filed by creditor Thomas J. Lynch ( Mr. Lynch ), and also in response to this Court s recently entered Order (Doc. 3250) granting in part and denying in part the Motion to Amend, states the following: 1. The Motion to Amend argues that this Court s originally entered order (Doc. 3230) as to Mr. Lynch s request for an administrative expense erred as to two specific findings of fact. See Doc One of Mr. Lynch s allegations of error concerned a finding by this Court that Mr. Lynch s administrative expense motion was opposed by the Trustee. See id.; see also Doc (granting Mr. Lynch s Motion to Amend to the extent it requested deletion of a statement which 1 The Debtors in these cases, along with the last four digits of each Debtor s federal tax identification number, are New WEI, Inc. (f/k/a Walter Energy, Inc.) (9953); Atlantic Development and Capital, LLC (8121); Atlantic Leaseco, LLC (5308); Blue Creek Coal Sales, Inc. (6986); Blue Creek Energy, Inc. (0986); New WEI 7, Inc. (f/k/a J.W. Walter, Inc.) (0648); Jefferson Warrior Railroad Company, Inc. (3200); New WEI 2, LLC (f/k/a Jim Walter Homes, LLC) (4589); New WEI 13, Inc. (f/k/a Jim Walter Resources, Inc.) (1186); Maple Coal Co., LLC (6791); Sloss-Sheffield Steel & Iron Company (4884); SP Machine, Inc. (9945); Taft Coal Sales & Associates, Inc. (8731); Tuscaloosa Resources, Inc. (4869); V Manufacturing Company (9790); New WEI 19, LLC (f/k/a Walter Black Warrior Basin LLC) (5973); New WEI 18, Inc. (f/k/a Walter Coke, Inc.) (9791); New WEI 22, LLC (f/k/a Walter Energy Holdings, LLC) (1596); New WEI 20, LLC (f/k/a Walter Exploration & Production LLC) (5786); New WEI 1, Inc. (f/k/a Walter Home Improvement, Inc.) (1633); New WEI 6 Company (f/k/a Walter Land Company) (7709); New WEI 16, Inc. (f/k/a Walter Minerals, Inc.) (9714); and New WEI 21, LLC (f/k/a Water Natural Gas, LLC) (1198). The location of the Debtors corporate headquarters is 2100 Southbridge Parkway, Suite 650, Birmingham, Alabama

2 Main Document Page 2 of 5 indicated that [t]he motion is opposed by the Chapter 7 Trustee. ). This filing specifically concerns that finding and its ultimate deletion from this Court s opinion. 2. The Trustee s purpose in filing this document is not to ask the Court to set this matter for hearing, or to further alter its opinion as to Mr. Lynch s administrative expense request. Instead, the Trustee wishes to make the record clear that, along with Warrior Met Coal, Inc. ( Warrior Met ), the Trustee has opposed Mr. Lynch s administrative expense request at every step in the litigation. Counsel for the Trustee attended and participated in every hearing related to the administrative expense claim; attended the deposition of Mr. Lynch as to the administrative expense claim; participated in negotiations with Mr. Lynch s counsel as to the administrative expense claim; participated in strategy sessions with counsel for Warrior Met as to opposing the administrative expense claim; and, attended the trial as to Mr. Lynch s administrative expense request. Though a specific pleading was not filed with this Court by the Trustee objecting to Mr. Lynch s request, it cannot be reasonably argued by anyone involved that the Trustee s position as to Mr. Lynch s admin claim was unknown. 3. In addition, it was not necessary for the Trustee to specifically file an objection since Warrior Met, a party in interest, did so. Under 11 U.S.C. 503(b), a hopeful administrative expense claimant must attend a hearing and shoulder an evidentiary burden in order to obtain an administrative expense claim. See 11 U.S.C. 503(b)(1); 4 Collier on Bankruptcy [1] (16 th ed.) ( [A]dministrative expenses, except ordinary course expenses paid pursuant to sections 363 and 364 of the Code, are allowed only after notice and a hearing and are not deemed allowed but rather must actually be allowed by court order. ). See also In re HNRC Dissolution Co., 343 B.R. 839, 843 (Bankr. E.D. Ky. 2006) ( A claimant has the burden of proving entitlement to an administrative expense by a preponderance of the evidence. ). Even absent a specific objection to 2

3 Main Document Page 3 of 5 the administrative expense request, this Court could have decided that Mr. Lynch s application failed to establish that an administrative claim was warranted. See Guaranty Nat. Ins. Co. v. Greater Kansas City Transp. Inc., 90 B.R. 461, (D. Kan. 1988) (refusing to allow a requested administrative expense claim purely based on the absence of objections from parties-ininterest, and, instead, evaluating whether the requested claim was entitled to administrative priority under Section 503(b)(1)). IN ACCORDANCE, the Trustee files this Response in order to make his opposition to Mr. Lynch s administrative expense clear for purposes of the written record. OF COUNSEL: SIROTE & PERMUTT, P.C Highland Avenue South Post Office Box Birmingham, AL Telephone: (205) Facsimile: (205) sporterfield@sirote.com thumphries@sirote.com /s/ Stephen B. Porterfield Stephen B. Porterfield Thomas B. Humphries Counsel for Andre M. Toffel Chapter 7 Trustee 3

4 Main Document Page 4 of 5 CERTIFICATE OF SERVICE I hereby certify that on this the 28th day of February, 2018, I electronically filed the foregoing with the Clerk of the Court using the CM/ECF system which will send notification of such filing all persons and entities that have filed a request for service of filings in this case pursuant to Bankruptcy Rule Electronic notice, and via U.S. Mail where appropriate, will also be provided to the following: Jay R. Bender Cathleen C. Moore James Blake Bailey Bradley Arant Boult Cummings LLP One Federal Place 1819 Fifth Ave North Birmingham, AL jbailey@bradley.com ccmoore@bradley.com jbender@babc.com Akin Gump Strauss Hauer & Feld LLP One Bryant Park New York, NY Attn: Ira S. Dizengoff Seminole Coal Resources, LLC ERP Compliant COKE, LLC ERP Environmental Fund, Inc. 15 Appledore Lane P.O. Box 87 Natural Bridge, Virginia Attn: Thomas M. Clarke Jayna Partain Lamar J Leland Murphree Robert Karl Ozols Maynard, Cooper & Gale, P.C th Ave N 2400 Regions Harbert Plaza Birmingham, AL jlamar@maynardcooper.com Lmurphree@maynardcooper.com rozols@maynardcooper.com ERP Compliant Fuels LLC PO Box 305 Madison, WV Attn: Kenneth R. McCoy Robert N. Kravitz Daniel J. Leffell Allan J. Arffa Dan Youngblut Paul, Weiss, Rifkind, Wharton & Garrison 1285 Avenue of the Americas New York, NY ERP Compliant Fuels LLC c/o ENCE Co., Inc Seaford Drive Columbus, OH Attn: Charles A. Ebetino, Jr Akin Gump Strauss Hauer & Feld LLP 1333 New Hampshire Avenue, N.W. Washington, DC Attn: James Savin Michael L. Hall Jay Haithcock James P. Roberts, LLP Burr & Forman, LLP th St. N Suite 3400 Birmingham, Alabama mhall@burr.com jhaithcock@burr.com jroberts@burr.com 4

5 Main Document Page 5 of 5 J. Thomas Corbett Jon A. Dudeck U.S. Bankruptcy Administrator Northern District of Alabama 1800 Fifth Avenue North, Suite 325 Thomas_Corbett@alnba.uscourts.gov Jon_Dudeck@alnba.uscourts.gov Andre M. Toffel, Trustee Andre M. Toffel, P.C. 450-A Century Park South, Ste. 206A Birmingham, Alabama atoffel@toffelpc.com jcraft@toffelpc.com W. Joseph Dryer Don F. Oliver 1000 N. West Street, Suite 1200 Wilmington, DE dfr.wjd@gmail.com dfr.dfo@gmail.com /s/ Stephen B. Porterfield OF COUNSEL 5