DBSI, Inc. was the originator of thousands of TIC (tenant in common) limited liability companies and limited partnerships. DBSI, Inc. through its many related companies offered investments, real estate development and property management services to thousands of investors before its November 2008 filing. Early in the case an examiner was appointed who found significant co-mingling of funds had occurred and recommended the appointment of a chapter 11 trustee.
A trustee (James Zazzali, former New Jersey Supreme Court Chief Justice) was appointed. He retained Myers & amp; Co., Consultants, LLC as financial manager for this complex case, who in turn retained Advanced CFO team members Mr. Donovan and Mr. McKinlay as on-site managers. At the confirmation hearing in October 2010, Judge Walsh remarked that the DBSI case was one of the most complicated cases he had experienced in all his time on the bench.
Mr. Donovan’s and Mr. McKinlay’s duties in this case included the development of sophisticated financial models to assist with the substantive consolidation of the many entities; a forensic accounting of the Debtor’s books and records to establish grounds for substantive consolidation; the liquidation of assets including dozens of real property assets; the supervision of claims review and objection process including focus on Secured, Administrative, and Priority tax claims resulting in reduction of millions of dollars in tax claims; and the abatement of related penalties.
They also provided significant litigation support and forensic accounting to prosecute claims on behalf of the Trustee and trust beneficiaries. Mr. Donovan and Mr. McKinlay administered a liquidating plan across 22,000 creditors, with damages asserted totaling over $100 billion.