Liftopia will sell assets to settle with Aspen Skiing Co., others
An online lift ticket broker alleged to owe nearly $2.4 million to Aspen Skiing Co. has transferred its assets to a professional liquidator, meaning the parties will no longer be arguing over the debt in court.
A proposed stipulation with Skico and other mountain operators shows that San Francisco-based Liftopia Inc. transferred its assets through what’s called “assignment for the benefit of creditors,” or ABC, to a specially created limited liability corporation on Oct. 29. The stipulation was filed Nov. 24 in federal court in Oakland, California. A judge has yet to approve the agreement.
Under the proposal, the LLC will supervise the future sale of Liftopia’s assets through an out-of-court liquidation that would be held in California. Proceeds from the sale would go to creditors.
“Compared to bankruptcy liquidation, (ABCs) may involve less administrative expense and are a substantially faster and more flexible liquidation process,” according to americanbar.org.
Skico had no comment and Liftopia’s lead attorney on the matter could not be reached Tuesday.
Liftopia sold lift tickets for 15 years including Skico’s Mountain Collective pass online since 2012.
Earlier this year, however, Skico cut ties with Liftopia and in June, it and other ski area operators tried to force Liftopia into involuntary bankruptcy. Skico had the largest claim at $2.38 million, and was joined by Alterra ($63,723), Cypress Bowl Recreations ($395,424) and Arapahoe Basin ($175,704).
“We commenced this case because out of fear that Liftopia would end up bankrupt with far fewer assets remaining to distribute to unsecured creditors,” said Joshua Morse, who has represented Skico in the matter, at an August hearing in a California bankruptcy court.
Under bankruptcy law, however, monetary claims by petitioning creditors must be accurate — and not disputed by the debtor — for an involuntary procedure to advance.
That’s what led to the dismissal of the case against Liftopia. At the end of the August hearing, U.S. Bankruptcy Judge Hannah Blumstiel of the Northern District of California threw out the case because Liftopia attorney’s said the combined amount of the claims were overblown by $86,000. A “bona fide dispute” over the debt existed and was reason to dismiss the case, the judge said.
Skico and the other creditors filed a notice to appeal Blumstiel’s ruling in September. They are backing off that appeal now, however, based on the proposed stipulation jointly filed in November.
“Whereas, the Parties have now consensually resolved this dispute and wish to dismiss the appeal,” the proposal said.
Because their involuntary bankruptcy petition was dismissed, Skico and the other creditors faced potential consequences such as paying Liftopia’s attorney’s fees and legal costs associated with the litigation. The court also could have given Liftopia compensatory and punitive damages if Skico and the other petitioners were found to have made a bad-faith filing.
Under the proposed stipulation, however, “Each party shall bear its own fees and costs on the appeal and in the related preceding before the bankruptcy court.”
In an email sent to their clients in August after the case was dimissed, outgoing Liftopia CEO Evan Reece said the company had signed a letter of intent to be acquired. The letter did not identify the purchaser.
“This transaction will enable us to settle with any partners with whom we are not in good standing,” said the letter, which was posted on Twitter by at least one user.
A call placed to Liftopia on Tuesday received an automated response pertaining to its summer business hours.