Plymouth Rubber Co. Inc., Canton, Mass., filed for Chapter 11 bankruptcy protection with the U.S. Bankruptcy Court in Boston because the PBGC filed a lien against the company, according to court documents. The PBGC filed a roughly $9.8 million lien on Plymouth Rubber's assets in August 2004, according to court papers filed by Plymouth Rubber. Company officials, however, believe the agency's claim "is much lower than stated on a current basis," closer to $5.7 million, according to a motion filed Tuesday. Court documents said the PBGC's "filing created a conflict as to priority" among the PBGC and Plymouth Rubber's secured lenders.
Plymouth Rubber had $6.1 million in plan assets as of Nov. 28, 2003, and was underfunded by about $7.1 million as of that date, according to the company's most recent annual report filed with the SEC.
Jeffrey Speicher, a PBGC spokesman, could not comment on the matter by press time. Joseph D. Hamilburg, chairman of Plymouth Rubber, did not return a call by press time seeking comment.