SOUTH BEND – A legal battle could decide whether South Bend's ethanol plant will be liquidated or reopen for business.
A Texas company wants to buy the plant and says last month's bankruptcy sale to two liquidators is illegal.
Attorneys for several sides of the fight met Wednesday in bankruptcy court.
WSBT talked with two different people who both say they are interested in buying and operating the plant.
One of them is a Texas company called Natural Chem.
It claims the bankruptcy auction was illegal because the two bidders who won the auction pooled their resources and refused to bid against each other.
But a bankruptcy judge disagreed, saying that auction was legal.
He also ruled Wednesday the sale to those two liquidators will move forward, but Natural Chem is still trying to block the sale.
The CEO already filed an appeal in U-S District court.
That means a federal judge will now decide whether the auction happened legally and whether there should be a second auction.
“In a renewed proceeding, I think Natural Chem will prevail,” said Natural Chem’s Robert Salazar.” We would buy the plant, We’re going to improve it. We’ll double the number of jobs. We’ll add new products and processes. We’ll be producing additional fuel products and chemical products as well as our own proprietary brand of animal feed supplements.”
Natural Chem is not backing down in this fight.
The company is appealing in district court, even trying to get an emergency hearing in front of a judge as early as Wednesday.
A judge there could block the sale or at least put it on hold while he decides whether the auction happened legally.
The judge said the bankruptcy sale to the two liquidators can move forward.
They told the judge they plan to close the deal with New Energy Corporation within the next week.
Natural Chem's CEO told WSBT you have to produce more than ethanol and animal feed to stay alive in the ethanol industry.
He says his company makes a total of 5 or 6 products from corn.
Natural Chem just bought an ethanol plant out of bankruptcy in Idaho.
