NEW YORK (Reuters) - The bankruptcy judge who oversaw the massive cleanup after the Enron and WorldCom meltdowns has a new challenge that may be his toughest yet -- overhauling Chrysler LLC.
Judge Arthur Gonzalez of U.S. Bankruptcy Court in Manhattan was assigned the case on Thursday after the iconic carmaker sought Chapter 11 bankruptcy protection following the breakdown of intense negotiations with lenders.
Chrysler filed the case in one of the premier federal bankruptcy courts, and Gonzalez is one of its most experienced judges.
He simultaneously handled the Enron and WorldCom bankruptcies earlier this decade -- both filed after massive accounting frauds were unearthed at the companies.
“We have a judge here with experience, who did Enron and WorldCom at the same time, so he’s not afraid of work and he understands complex issues,” said Natasha Labovitz, a partner in the restructuring group at law firm Kirkland & Ellis LLP, who has appeared before the judge.
A former New York City schoolteacher, Gonzalez took the bench in 1995 after monitoring bankruptcies for the government as a U.S. Trustee for New York, Connecticut, and Vermont.
“He is experienced, wise, patient and fair,” said Martin Bienenstock, a bankruptcy attorney at law firm Dewey & LeBoeuf LLP, who represented Enron in its bankruptcy. “He works indefatigably and keeps a sense of humor.”
Gonzalez will “not at all” be put off by a big case with national attention, Bienenstock said. “He’s been there, done that.”
If the company and government officials have their way, Chrysler’s most profitable units will emerge from bankruptcy in 30 to 60 days as a new company -- a rapid-fire sale process in which the judge will face big decisions early in the case. But other aspects of the case could drag on for years.
The first-day hearing in the case is set for Friday morning.
Gonzalez received a bachelor’s degree in accounting from New York’s Fordham University in 1969 and a master’s degree in education from Brooklyn College in 1974. He was a public school teacher for 13 years.
He got his law degree at Fordham’s law school in 1982 and a master of law degree in 1990 from New York University Law School.
Other cases Judge Gonzalez has handled include the Chapter 11 filing by appliance maker Sunbeam Corp in 2001.
He also oversaw the bankruptcies of Iridium LLC, a satellite telephone service, and the collapse of Livent Inc, a Canadian theater-production company that fell apart amid accounting irregularities.
Additional reporting by Emily Chasan; Editing by Tim Dobbyn