Cyphermint Investors Ask For Dismissal
Russian investors in Marlborough-based Cyphermint Inc. are asking U.S. Bankruptcy Court to dismiss involuntary bankruptcy proceedings against the company because they claim two of the three petitioners were not valid.
It takes three petitioners to get an involuntary liquidation proceeding initiated.
The U.S. Bankruptcy Court in Worcester will hold an 8 a.m. hearing on the emergency motion on Sept. 29, the same day the court will hear sales proposals filed with the court by Sept. 25.
The motion claims that no evidence has been shown that one petitioner, Sheffield Corp. of Winchester, is a valid creditor. It also points out that John Harrington III, who signed the original petition on behalf of Sheffield, is actually a principal in the only company that has submitted a bid so far for Cyphermint's assets: C.A. Acquisition Corp. The offer is for $100,000 in cash and another $125,000 over two years.
In a previous court hearing it was reported that Sheffield Corp. owns 12 percent of C.A. Acquisition Corp. C.A. Acquisition Corp. has also been approved by the court to run Cyphermint until it is sold.
Sheffield claimed in the original petition that it was owed $97,690.
Worcester Attorney James P. Ehrhard filed the dismissal motion and previously objected to the proposed sale to C.A. Acquisition Corp. for $225,000. Earhard has claimed it is a "bait and switch offer" because the company offered $3.3 million for Cyphermint this past spring.
The dismissal motion also states that another of the petitioners, Limmel Associates of Marlborough, does not show up on a list of creditors. However, Limmel Associates does business as MetroWest Printing, and that business is on the list of about 80 creditors. Limmel, as MetroWest Printing, claims it is owed $1,250.
Ehrhard represents Russian companies that invested in the mobile payment software company: Promtex LLC, SIA AMTO and OJSC, "Saint Petersburg Investment Company."
On Aug. 21 three creditors petitioned U.S. Bankruptcy Court to liquidate Cyphermint so they could get money the company owed them. Sheffield Corp., Limmel Associates and High-Grade Cleaning Service of Hudson, which claims it is owed almost $10,000, filed the petition and requested a trustee be assigned to the case. The trustee is Attorney Joseph Baldiga of Worcester-based law firm Mirick O'Connell.
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