Genmar objects to FLW Outdoors motion on engines

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Objections were filed to FLW Outdoors’ expedited motion that it be allowed to obtain possession of 46 engines – valued at more than $450,000 – it says are now with Genmar’s Ranger and Stratos boat companies, but owned by FLW Outdoors.

Genmar Holdings and the Committee of Unsecured Creditors in the Genmar bankruptcy case both filed objections last week to the motion.

A hearing is scheduled for today in bankruptcy court in Minnesota.

The engines in question are 42 Evinrudes and four Yamahas.

FLW says it still holds the Manufacturer’s Statement of Origins for 20 engines in Ranger’s possession, with a combined value of $188,667.50 and holds the MSOs for 22 engines in Stratos’ possession with a combined total value of $223,244. It also holds the MSOs for four Yamaha engines with a combined total value of $39,846.80.

Genmar, in its objection, says, “Under applicable law, title to the engines passed upon physical delivery and FLW Outdoors has no rights of ownership or possession.”

Genmar also disputes FLW’s explanation of agreements FLW had with Ranger and Stratos boats over the engines.

The Committee of Unsecured Creditors says it, and others, object to FLW’s request, because they have not had enough time to learn all the facts necessary to respond.

“For that reason, the UCC supports the objections (or anticipated objections) of the debtors and Wells Fargo,” according to court documents. “The UCC understands the debtors and Wells Fargo believe strongly (for factual and legal reasons) that FLW does not have a perfected interest in the engines.”

Also, the committee says FLW did not explain why, after five months from the beginning of this case, it suddenly needed expedited relief from the state. The engines in question have been in possession of the debtors all of that time.

Genmar agreed, stating, “The motion does not demonstrate that the risk of additional sales between the emergency hearing date and a properly noticed hearing is any greater than its risk during the five months of this case in which FLW Outdoors failed to bring the motion. FLW also fails to explain how potential conversion of an engine into cash or a receivable diminishes its rights on those proceeds, assuming it holds such rights.”

FLW said it is seeking emergency, expedited relief in the case “because, upon information and belief, Ranger and/or Stratos has purported to sell or may attempt to sell one or more of the FLW engines in direct violation of their prior agreement with FLW Outdoors,” according to court filings.

“Upon information and belief, one or more of the FLW engines have been installed on boats and/or transferred to third parties without the prior permission of FLW Outdoors and is in direct contravention of FLW Outdoors’ ownership interest in them,” documents state. “In lieu of expedited relief, FLW Outdoors seeks an order temporarily restraining the debtors from transferring any of the FLW engines or taking any other action that could affect FLW Outdoors’ ownership interest in them …”

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Comments

6 comments on “Genmar objects to FLW Outdoors motion on engines

  1. George

    Perfecting their interest meaning were they documented and recorded properly?  What does this say about the packaging method in which dealers buy boats, motors, and trailers?

  2. Doug Reimel

    The dealer network has been far to trusting of our manufacturers for far to long. This is a classic example why the dealer must verify the paperwork first before accepting delivery of any product from any manufacturer. Remember the job is not done until the paperwork is done. Not in todays world, it is now the job starts with proper documentation, after all the dealer is the manufacturers customer. The dealer is the one who devulges the manufacturers short comings and failures in product, which destroys the manufacturers C.S.I score. If only the dealer was treated as a true partner in the retailing of the product.
    Was I supposed to drink the blue koolaid or the red koolaid today!

  3. EG

    Interesting!!!!!!!!, 
    The average cost of the 46 engines is 9,782.00 dollars. They must all be 150 EFIs. They can’t possibly be HPDIs, Optimaxs, or E-TECs engines. To cheap

  4. Troy

    So Doug, looks like you threw a blanket statement over ALL boat manufacturers…………we are all not to be trusted??? Not all of us are out here trying to play games on our dealers. You post just makes what I said last week even more relevant….why do some dealers keep dealing with the big builders and keep taking it?? They push product on you, tell you what you are going to do……I don’t get it. Why not deal with a small bulder and have an actual working relationship with the manufacturer? I dont understand why some dealers are bashing Genmar on one hand….but then on the other hand are saying that they cant wait until the bankruptcy is over with and they can deal with Genmar again. Why put up with it? There are alot of other builder besides the big ones………

  5. chris

    you can dress up in any fashion you want, but theft is theft – regardless of the fashion choice or lipstick colour

  6. Troy

    Theft?? From who? Both companies are/were owned by the same guy. You cant steal from yourself….and he knew before all of this exactly what was going on.

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