Could Mike Wolf end up owning Lionel?

[Anonymous]

Could this ever happen? I don't think so. I noticed many people stating that he could become the owner of Lionel if MTH won this recent court battle. What do you guys think?

[FJ and G]

My understanding is that people in Lionel are following Maddox's lead and are polishing up their resumes. Every man for himself!

dav

[okiechoochoo]

It has always been my understanding that Mike would like to own the Lionel name. This 41M verdict will probably be lowered but if not, I think there is a very good chance Mike could wind up owning Lionel thru some settlement. If that happened, I think Mike would shut down Lionel production and merely put the much better recognized name of Lionel on his trains. I would also expect him to stop all production and licensing of TMCC products. These are just my opinions of where we might be headed

[dougdagrump]

Both of their products are already overpriced in my opinion.

[Big_Boy_4005]

I thought we had discussed this one Jack. I remember seeing it, but it may have been inside one of the other topics. $40 mil is a lot of money by the toy train industry's standards, but when all is said and done, I doubt that Mike will be in charge at the circle L. They will find a way to pay over time, and life will go on just the way it always has. They aren't going to just roll over after over 100 years.

Dave may be right though, there probably will be some more changes in management. Who knows, maybe the Fastrack project will get dumped in an effort to cut costs and streamline operations. Wouldn't that be ironic? [swg]

[Anonymous]

Elliot:

Or maybe Lionel HO takes the hit. Whether or not that happens depends upon how the sales of their new entries do.

Anybody know if Lionel's latest high priced HO offerings are selling?

Tony

[Anonymous]

With the $40mil he could save up and BUY Lionel practically in stock, like in the 60s with Rich Kuhn!

[Anonymous]

QUOTE: Originally posted by dougdagrump

Both of their products are already overpriced in my opinion.

Of course they are Doug.

[Anonymous]

Well first he has to pay the lawyers and court costs; likely 40% plus 2 million in costs as he did this on contingency fee;

So Wolfe only has $23,220,000. to play with.

I wish he'd invite me over to play!

Alan

[eZAK]

Probaly never!
I think the name Lionel is worth more than $40Mil.
They would probaly file chapt 13(or 11) before they sell.

QUOTE: My understanding is that people in Lionel are following Maddox's lead and are polishing up their resumes. Every man for himself!

Isn't Maddox the guy who got Lionel into this mess in the first place!
Move everything to China and stealing trade secrets.....!.What A Guy!

[nblum]

The events in question occurred in the 1997-2000 time framework. *** Maddox didn't arrive on the Lionel scene until mid to late 1999. He wouldn't have been directly involved in these events except in the aftermath. I may be mistaken, but I don't think so. Gary Moreau was the CEO when the alleged improprieties occurred.

[ChiefEagles]

Alan, not 40%. My leagal person says 1/3. 33.3% of 40 M is not as much as 40%.

[Anonymous]

Here's is how it is done

take the award subtract the costs then Wolfe gets 60% of the remander;
the 1/3 for legal fees is not typical these days in large IP cases and even PI cases the contingent fee amout is 40% after costs;

However, Wolfe could have worked out any sort of deal with his atty; do you know that for a fact that it is 1/3????


Alan

[Anonymous]

Anyway you look at it, I agree with Elliot. Lionel will continue and Mike will not own it.

[Anonymous]

WORST CASE

Let's say (since we have assumed everything except the Sun going Supernova) THAT
Lionel is over-leveraged and can't get a loan and cant raise the $41 mil req's to be held with the court ( In Fed Court, I think that this can be a Surety Bond) within the next six weeks in order to appeal........

LIONEL is then forced into an involuntary Bankruptcy by Wolfe and two other creditors (usually banks)(Chapter 7 no reorg like United); the the company will be disolved ; the assets sold off to pay the secured creditors, Wolfe is now a secured creditor. Wolfe gets in line with all the other secureds and his claim is last in priority of the other secureds usually Lionel's prior bank loans are senior claims.

Wolfe could get NOTHING! of Course Lionel is gone!!

Alan

[nblum]

Alan, in the worst case scenario, could the owners of Lionel sell the Lionel trademark and rights to the use of the name to another company to raise cash prior to declaring bankruptcy, thus keeping the right to use the name out of the hands of the individual who successfully destroyed the company?

[3railguy]

If MTH were to take over Lionel.....................................
My favorite brand is Atlas followed by Lionel. More and more Lionel is built like Atlas these days anyway. Plus they both have TMCC. I prefer TMCC over DCS due to it's simplicity. TAS I'm sure would keep up the TMCC components. So if MTH takes over Lionel, I will only buy Atlas. I'm not going to worry about it too much. There are plenty of options out there.

[okiechoochoo]

Neil,
I hope Lionel can keep their name out of Mikes hands. I would rather have no Lionel than Mikes stuff with Lionel's name on it

[Anonymous]

IF LIONEL WENT INTO CHAPTER 7 BANKRUPTCY; big on the IF:

A bankruptcy "SALE" or auction is held to obtain the highest value of the assets.

There are no preferences, in fact all of Lionel's activities over the last year are reviewed by the Bankruptcy Court; Any preferences (payments made to others that look fishy) are disgorged (reversed by the court as if they never occurred).

At that point Wolfe doesn't have any of his $24 mil, So You could buy the trademarks of Lionel if you outbid all bidders.


Alan

[nblum]

Alan, thanks for that information. What I was curious about was not payments by Lionel, but sales of their good will and property. Could they, prior to filing for bankruptcy, sell their trademark and/or tooling to, let us say, Atlas or Sanda Kan to raise as much cash as possible prior to filing? In other words, are there restrictions on what they could sell, at fair market value, prior to filing for bankruptcy?

[Anonymous]

Neil

No; that kind sale would look like a preference and would be disgorged or reversed. And that may be the only asset left to Lionel as I understand they have been selling off all other assets during the last few years.


Alan

[Anonymous]

What a bunch of nonsense. Don't you ninnies have anything better to do with your time than to post this drivel?
If MTH winds up owning Lionel it will be the best thing that happend to the hobby. And if it indeed happens, you can blame Lionel's incompetent management for diging Lionel's grave. All MTH has done is supply the shovels.
BillFromWayne
www.modeltrainjournal.com

[Anonymous]

Billfrom Wayne

No


Alan

[nblum]

Now, Bill, we don't make fun of your hobbies, leave us legal hot stove league folks to do our thing. Drivel is like beauty, in the eye (or ear) of the beholder.

[Anonymous]

If Mike ever winds-up owning Lionel at least he'll run it better than Lionel. Besides, I'd love to see the 'Lionel' nameplates appear on the "Tinplate Traditions'" line.

BillFromWayne
www.modeltrainjournal.com

[nblum]

I agree that Lionel nameplates would be infinitely better and more appropriate than those goofy MTH nameplates on these reproductions of icons of the prewar period. I might even consider buying one or two. Just not with the MTH nameplate :).

Perhaps Mike could run Lionel better than the current guys. He hasn't done all that well with MTH in the last few years for some reason. Maybe we'll see just how well he does when he's the only game in town. Be prepared for there to be only one company making three rail trains within the next few years if that happens. I don't think Mike much likes to have competition.

[garyseven]

Who is the judge in the case?
Is there anything pertinent we can learn from previous rulings?
Does it go next to a Court of Appeals with multiple judges?
Is there anything pertinent we can learn from their previous rulings?
Can someone give us a layman's (or in my case, a big dumb guy's) timeline and primer of what to expect next?

[okiechoochoo]

Bill
What makes you think Mike's possible takeover of Lionel would be good for the hobby. Bet he would use the Lionel name to sell trains instead of MTH which shows who the real number one is

[Anonymous]

Okiechoochoo:

Listen, I agree about the Lionel name. I can’t imagine a father walking into a train shop and
asking the counter person to show him a Lionel Train Set at Christmas and the counter person
does the old bait and switch and shows him a K-Line or MTH set. “What’s K-Line? What’s
MTH? I want Lionel Trains.” That’s where Lionel has the edge. Its name recognition.

My reasoning is that Mike is enthusiastic about the train business and has a savvy about the
business that none other have.

Kughn and Wolf were the best things that ever happened to Lionel and it showed in the increased quality and quantity of trains and accessories from Lionel. But management changed hands and Lionel was seen as a trophy because of the perceived income from the recognition of the Lionel name and a host of silly non O-gauge train products licensed by Lionel.

So, if Lionel gets sold again, and MTH isn’t the successful suitor then look for a repeat of the
MPC crap.

As I stated in many previous posts with this theme, I could care less if Lionel were to shutter their
doors today. Of course I would be sad, however, I have so much O-gauge train stuff that I have
enough trains to keep me busy until the Grime Reaper comes a knocking.

That’s my opinion.

BillFromWayne
www.modeltrainjournal.com

[Anonymous]

Anyone think Jerry Williams might buy the Lionel name?