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Hostess Bankruptcy 2012 - Union and Company Forced to Mediation to Save the Twinkie
The 2012 Hostess bankruptcy process has been forced into mediation by a judge.
On Monday, a bankruptcy judge was able to get both sides to agree to giving mediation a final chance to stop the company from going under.
U.S. Bankruptcy Judge Robert Drain said yesterday at a hearing in White Plains, New York, that there are "serious questions as to the logic behind the decision to strike," and asked for mediation to save the company and all those jobs.
A successful mediation will halt the company shut-down, a failure means the company will go out of business, leaving over 180,000 employees out of work.
"To me, not to have gone through that step leaves a huge question mark over this case which I think will only be answered in litigation," Drain said.
"My desire to do this is prompted primarily by the potential loss of over 18,000 jobs, as well as my belief that there is a possibility to resolve this matter, notwithstanding the losses the debtors have incurred over the last week or so."
CS Monitor.Com cites an attorney from Dallas who says it is "more advantageous for Hostess to participate in the court-ordered mediation session because it will show that it did everything it could to save the company."
Bankruptcy attorney Linda LaRue said, "It’s very difficult to have a Chapter 11 case succeed without a successful relationship with the unions and what’s what we’re seeing now. It would behoove them to [enter mediation] despite all the negotiations they’d done, if for nothing else to show a good faith effort. There are thousands of jobs at stake."
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