Case MFW Doc 580 Filed 12/09/15 Page 1 of 6 IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE.

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1 Case MFW Doc 580 Filed 12/09/15 Page 1 of 6 IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re: Signal International, Inc., et al. 1 Debtors. Chapter 11 Case No (MFW) Jointly Administered Reference Docket Nos. 562 RESPONSE OF JORDAN PILE DRIVING, INC. TO THE DEBTORS THIRD OMNIBUS OBJECTION TO CLAIMS PURSUANT TO SECTION 502(b) OF THE BANKRUPTCY CODE, BANKRUPTCY RULES 3003 AND 3007, AND LOCAL RULE Jordan Pile Driving, Inc. ( Jordan ), hereby files this response (the Response ) to the Debtors Third Omnibus Objection to Claims Pursuant to Section 502(B) of the Bankruptcy Code, Bankruptcy Rules 3003 and 3007, and Local Rule (the Claim Objection ). In support of this Response, Jordan states the following: 1. On July 12, 2015 (the Petition Date ), the Debtors filed voluntary petitions for relief under chapter 11 of the Bankruptcy Code. The Debtors continue to operate their business as debtors in possession pursuant to sections 1107(a) and 1108 of the Bankruptcy Code. 2. On July 22, 2015, the Office of the United States Trustee for the District of Delaware (the U.S. Trustee ) appointed an official committee of unsecured creditors (the Committee ) [D.I. 119]. 3. On July 30, 2015, Jordan filed the Notice of Perfection of Claim of Mechanic s and Materialman s Lien under 11 U.S.C. 546(b) and 362(b)(3); Demand for Compliance with 11 U.S.C. 363 [Docket No. 152] (the Mechanic s Lien ) 1 The Debtors in these chapter 11 cases, along with the last four digits of each Debtor s federal tax identification number, are: Signal International, Inc. (4248); Signal Ship Repair, LLC (2642); Signal International, LLC (5074); Signal International Texas GP, LLC (3050); and Signal International Texas, L.P. (5066). The Debtors principal offices are located at RSA Battle House Tower, 11 North Water Street, Mobile, Alabama { } {0 1

2 Case MFW Doc 580 Filed 12/09/15 Page 2 of 6 4. On September 1, 2015, the Court entered the Order Approving (A) Sales and Bidding Procedures in Connection with Sale of Assets of the Debtors, (B) Approving Bid Protections, (C) Approving Form and Manner of Notice, (D) Scheduling the Auction and Sale Hearing, (E) Authorizing Procedures Governing Assumption and Assignment of Certain Executory Contracts and Unexpired Leases, and (F) Granting Related Relief [Docket No. 280]. 5. On October 13, 2015, Jordan filed the Limited Objection of Jordan Pile Driving, Inc. to the Debtors Motion for Entry of: (I) an Order (A) Approving Sales and Bidding Procedures in Connection with Sale of Assets of the Debtors, (B) Approving Bid Protections, (C) Approving Form and Manner of Notice, (D) Scheduling the Auction and Sale Hearing, (E) Authorizing Procedures Governing Assumption and Assignment of Certain Executory Contracts and Unexpired Leases, and (F) Granting Related Relief; and (II) an Order (A) Approving Purchase Agreement, (B) Authorizing Sale Free and Clear of All Liens, Claims, Encumbrances, and Other Interests, and (C) Granting Related Relief [Docket No. 394]. 6. On September 22, 2015, Jordan electronically filed a secured proof of claim (the Claim ) against the debtor Signal Ship Repair, LLC ( SSR ) with the Debtors claims agent, Kurtzman Carson Consultants, LLC. 7. On November 24, 2015, this Court entered the Findings of Fact, Conclusions of Law and Order Confirming Debtors' First Amended Joint Plan of Liquidation Pursuant to Chapter 11 of the Bankruptcy Code [Docket No. 555] (The Plan Confirmation Order ). In conjunction with the Plan Confirmation Order, a Disputed Claim Reserve was established. The Debtors set aside the sum of $101, in the reserve on account of Jordan s secured Claim. 8. On November 25, 2015, the Debtors filed this Claim Objection [Docket No. 562]. Exhibit 1 to the proposed order lists Jordan s Claim as a claim to be reclassified as an unsecured { } {0 2

3 Case MFW Doc 580 Filed 12/09/15 Page 3 of 6 claim, asserting that RSA, the Debtors senior secured lender, is under secured, and thus, even if Jordan would have had a valid lien, there is no property available that could serve as collateral for the money due. 9. On or about October 8, 2014, Jordan was retained by Signal Ship Repair, LLC to make install and repair mooring dolphins and related structures, after an off shore storm destroyed them at a property used by the Debtor. The property is located adjacent to 601 South Water Street, Mobile, AL (the Shipyard Property ). Jordan furnished labor and materials to make said repairs. Jordan last performed work on the Shipyard Property on February 6, Upon information and belief, the Debtor asserted a claim against a third party ship owner and the ship owner s insurance company to cover the cost of the repairs. Jordan never received payment for its work. 10. Jordan claims a lien pursuant to Code of Alabama et seq. on the Shipyard Property in the amount of $98, together with interest and attorney's fees as provided in Code of Alabama et seq. On June 22, 2015, Jordan filed a Verified Statement of Lien in the records of the Judge of Probate of Mobile County, Alabama. On July 21, 2015, Jordan filed an Amended Verified Statement of Lien in the records of the Judge of Probate of Mobile County, Alabama. On July 27, 2015, Jordan filed a Second Amended Verified Statement of Lien in the records of the Judge of Probate of Mobile County, Alabama. On July 28, 2015, Jordan filed a Third Amended Verified Statement of Lien in the records of the Judge of Probate of Mobile County, Alabama. Said Verified Statement of Lien, Amended Verified Statement of Lien, Second Amended Verified Statement of Lien and Third Amended Verified Statement of Lien were in compliance with Code of Alabama { } {0 3

4 Case MFW Doc 580 Filed 12/09/15 Page 4 of The lien is claimed, separately and severally, as to both the buildings and improvements, including the structures in the water, as well as the land, described in the said Verified Statement of Lien, Amended Verified Statement of Lien, Second Amended Verified Statement of Lien and Third Amended Verified Statement of Lien. 12. Jordan asserts the Debtor has not shown that the Teachers Retirement System of Alabama ( TRSA ) has a first priority lien on the land, building and improvements, including the structures in the water. Without a showing that TRSA has a lien on the land, building and improvements, including the structures in the water, the Debtors cannot reclassify this Claim by objecting to the Claim. 13. Pursuant to Fed. R. Bankr. P. 7001(2), an adversary proceeding must be commenced to determine the validity, priority, or extent of a lien or other interest in property, other than a proceeding under Rule 4003(d). In addition, Fed. R. Bankr. P. 3007(b) clearly requires the commencement of an adversary proceeding to determine whether or not Jordan has a valid secured claim. DEMAND FOR RELIEF REQUIRING AN ADVERSARY PROCEEDING. A party in interest shall not include a demand for relief of a kind specified in Rule 7001 in an objection to the allowance of a claim, but may include the objection in an adversary proceeding. Fed. R. Bankr. P. 3007(b) 14. While a party may include the objection in the adversary proceeding, relief cannot be granted without the filing of an adversary proceeding. WHEREFORE, Jordan respectfully requests this Court deny the relief requested by the Debtors in this Objection and require that the Debtors or TRSA commence an adversary proceeding that seeks a determination of the parties respective rights in the matter. { } {0 4

5 Case MFW Doc 580 Filed 12/09/15 Page 5 of 6 Date: December 8, 2015 PHILLIPS, GOLDMAN & SPENCE, P.A. /s/ Stephen W. Spence Stephen W. Spence, Esquire (#2033) 1200 North Broom Street Wilmington, DE (tel.) (fax) Sws@pgslaw.com Counsel to the Reorganized Debtor -and- MAYNARD COOPER & GALE, PC J. MARSHALL GARDNER, Esquire 11 North Water Street, Suite Mobile, AL Telephone: (251) Facsimile: (251) mgardner@maynardcooper.com { } {0 5

6 Case MFW Doc 580 Filed 12/09/15 Page 6 of 6 CERTIFICATE OF SERVICE I, CELESTE A. HARTMAN, Senior Paralegal to hereby certify that I am over the age of 18, and that on December 8, 2015, I caused a copy of the Response of Jordan Pile Driving, Inc. to the Debtors Third Omnibus Objection to Claims Pursuant to Section 502(B) of the Bankruptcy Code, Bankruptcy Rules 3003 and 3007, and Local Rule upon all persons receiving notice through the Court s CM/ECF system and upon the following persons, via U.S. First Class Mail, postage pre-paid. Young Conaway Stargatt & Taylor, LLP M. Blake Cleary, Esquire Kenneth J. Enos, Esquire Jaime Luton Chapman, Esquire Travis G. Buchanan, Esquire Rodney Square 1000 North King Street Wilmington, Delaware Under penalty of perjury, I certify the foregoing to be true and correct. /s/ Celeste A. Hartman CELESTE A. HARTMAN { } {0 6