Larry Winget: New owner of Mayco Plastics
Detroit — Plastics entrepreneur Larry Winget is back in court for a commercial dispute that has lasted more than a decade.
JPMorgan Chase Bank, in a court filing submitted in June, said it is seeking to recover roughly $410 million, plus an additional $368 million in unpaid interest and fees, owed to it under a credit agreement between Chase and several entities owned and operated by Winget and the Larry J. Winget Living Trust.
Chase did not immediately respond to requests for comment by Plastics News, an affiliate of Automotive News.
Grand Rapids, Mich.-based law firm Drew, Cooper & Anding P.C., is representing Winget and the living trust. Lead attorney John Anding had no comment on the case.
The more than $400 million dispute stretches back to March 2003, when Venture Holdings Co., a Fraser, Mich.-based injection molder owned by Winget that made a variety of interior and exterior auto parts, filed for Chapter 11 protection. The filing was considered a default under the credit agreement, and all obligations became immediately due and payable.
Venture’s bankruptcy came just 10 months after its German subsidiary, Peguform GmbH, filed for insolvency, cutting off the U.S. parent company from the bulk of its European income.
After a failed attempt at restructuring, Venture’s assets were liquidated and proceeds were applied to the underlying debt. But Chase and the lenders were still owed more than $300 million under the credit agreement, according to court documents from 2017.
On Aug. 15, the U.S. District Court in Detroit entered several orders allowing Chase to collect the millions of dollars from the living trust for guarantees that were initially put up to prevent Venture Holdings from failing many years ago.
Fifteen other firms connected to the living trust are included in the most recent court filings related to the case, including JVIS-USA LLC, Deluxe Technologies LLC and Golf Course Services LLC, Winget’s private golf course in Rochester Hills, Mich., operating as The Wyndate Country Club.
The case is ongoing.
‘Long-running saga’ continues
During a February 2017 hearing, U.S. Circuit Judge Alice Batchelder called it “the latest episode in a long-running saga that must now come to a close.”
But more than a year later, the saga continues.
Chase first sued Winget and the living trust in 2008 over unpaid debts dating back to 1999, when Venture obtained $450 million from a group of lenders to finance the purchase of Peguform, according to court documents. Peguform’s insolvency years later, however, triggered certain default and acceleration clauses in the credit agreement.
Winget paid $50 million to Chase, satisfying his portion of the debt, but a substantial balance — more than $400 million — remains.
It wasn’t the first time Venture was entangled in a lawsuit over finances, however.
In 2005, Venture was being investigated by federal authorities over possible accounting irregularities between 1998 and 2002.
And in 2004, the bankrupt injection molder and its related manufacturing units filed a lawsuit against Winget, members of his family and other business interests, alleging they siphoned hundreds of millions of dollars out of Venture, resulting in its bankruptcy.
At NPE 2003, just months after the company filed for Chapter 11 protection, a Venture spokeswoman confirmed it was buying 18 injection molding machines, including a probable order for more than 40 additional presses, from the HPM Division of Taylor’s Industrial Services LLC.
HPM, which had a turbulent history of its own involving ownership changes, layoffs, unpaid taxes and bankruptcy, closed its doors in late 2009. In 2011, Chinese machinery maker Guangdong Yizumi Precision Machinery Co. Ltd. bought the intellectual property of HPM, forming Yizumi-HPM Corp.
And adding to the saga of second chances and financial disruptions, in 2006, the Winget-controlled firm NJT Enterprises LLC bought Mayco Plastics Inc. for $5.5 million through the U.S. Bankruptcy Court in Detroit.
The Sterling Heights, Mich.-based injection molder and Tier 1 auto supplier had entered Chapter 11 protection earlier that year. The company now operates as Mayco International LLC.