MuscleTech Research Development Inc. (“Muscletech"") was involved in the manufacture and sale of various health and weight loss supplements distributed in North America through retailers such as GNC and Walgreens. Muscletech and companies related to it were defendants in multiple class action and personal injury lawsuits throughout the US, some of which were consolidated at the District Court level in southern New York.
In order to address the lawsuits, Muscletech commenced proceedings under the CCAA and we were appointed as CCAA Monitor. As CCAA Monitor, we sought recognition of the Canadian proceeding as a foreign main proceeding under Chapter 15 of the US Code. In order to facilitate a successful restructuring and build consensus among the stakeholders, we: a) performed a valuation of Muscletech’s business and assets, which allowed the creditor groups to understand the potential proceeds available for distribution; b) completed a comprehensive, international claims process involving the various tort and other claims; c) participated in mediation sessions involving counsel representing the tort claimants and Muscletech’s products liability insurers in order to gain their confidence, understand the complexities involving each of the claims and guide settlement discussions and; d) assisted Muscletech to structure a plan of reorganization, including creditor classifications and recoveries.
The plan of arrangement was approved by Muscletech’s creditors, recognized by the Courts overseeing the matter in Canada and the US and implemented in both countries.