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Frank Crivello, Federal Deposit Insurance Corporation and Frank Pio Crivello Settle Litigation Commenced in 1994
Frank P. Crivello, with loans from Metro North State Bank, coast to coast,
built a large portfolio of shopping centers, including many Kmarts.
Milwaukee, Wisconsin --November 10, 2003--Frank P. Crivello announced that he settled litigation and was released by the Federal Deposit Insurance Corporation, ("FDIC"), as Receiver for Metro North State Bank, Kansas City, Missouri, related to a suit commenced in 1994. Before its failure, Metro North State Bank was part of a multi-billion dollar bank group. The suit related to a shopping center loan made in the late 1980's by Metro North State Bank to Frank P. Crivello and disputes that occurred in 1989.
Frank Crivello was represented in the FDIC litigation by Leonard G. Leverson, of the law firm of Kravit, Gass & Weber, S.C. ("KGW"), www.kravitlaw.com. Joseph Crivello and Frank Crivello, cousins, were partners in the shopping center development enterprise. Joseph Crivello was not a defendant in the FDIC litigation. During the 1990's, Frank Crivello served as an Executive Vice President of National Management, Inc., ("NMI"). Joseph Crivello is the sole shareholder of NMI, Fifth Corporation, Berkshire Factoring, Inc., Sierra Finance Corporation, and Sierra Holding Corporation. Frank Crivello owned in whole or in part 122 companies and employed over 1,000 individuals. KGW represented Frank Crivello, Joseph Crivello, and their companies.
During the late 1980's, Frank Crivello built and acquired a large portfolio of shopping centers, including many anchored by Kmart’s, across the country that totaled millions of square feet. Most were anchored by Kmart or other discounters along with chain grocery or drug stores. In addition, Frank Crivello built or acquired operating businesses including a restaurant chain and six big box grocery stores.
In the early 1990's the nation was in a recession and traditional real estate lenders were closing or collapsing. Under the weight of the recession and a banking crisis, Frank Crivello’s access to credit became severely limited. Ultimately his real estate enterprises failed. These were challenging times for Frank Crivello.
After efforts aimed at out-of-court settlements with creditors failed, Frank Crivello filed a voluntary chapter 11 petition on November 20, 1992. KGW acted as bankruptcy counsel for Frank Crivello, as a debtor-in-possession. Frank Crivello, as a chapter 11 debtor-in-possession stood in the shoes of a trustee and acquires the same rights, duties, and responsibilities as a trustee.
Between November 20, 1992 and August, 1994, KGW and Frank Crivello, as a debtor-in-possession, worked to confirm a Chapter 11 Plan of Reorganization (“Plan”). The Plan had broad creditor support and was supported by the unsecured creditors committee. The FDIC was Frank Crivello’s largest creditor given the concentration of the FDIC’s loans giving the FDIC an effective veto over Frank Crivello’s Plan. Indeed, without the consent of the FDIC Frank Crivello’s Plan couldn’t be confirmed. Unfortunately, the FDIC voted against Frank Crivello’s Plan.
In September, 1994, Frank Crivello’s bankruptcy case was converted to Chapter 7. Between September, 1994 and November, 1994, KGW and Frank Crivello negotiated with the Chapter 7 Trustee, his counsel, and the US Trustee’s office to settle all claims between Frank Crivello, including his related parties, and the bankruptcy estate.
In November, 1994, KGW and Frank Crivello and his related parties settled all matters with the bankruptcy estate subject to payment of $2,250,000 and a closing in March, 1995. On March 31, 1995, Frank Crivello closed the underlying transaction and paid the bankruptcy estate the required settlement. In April, 1995, Frank Crivello was granted his discharge in bankruptcy.
However, Frank Crivello’s bankruptcy settlement didn’t include the FDIC’s direct claims. The FDIC commenced a separate action in 1994. KGW represented Frank Crivello in this matter. The settlement today resolves this separate claim of the FDIC against Frank Crivello. This separate suit between Frank Crivello and FDIC is now finally and completely settled.
Frank P. Crivello stated: "During the late 1980's Metro North State Bank was my primary bridge and construction lender. As the full impact of the recession hit this bank group, the FDIC eventually became its Receiver in 1992. The FDIC took control of these banks and my loans were placed in liquidation. This was a very challenging time. I was pleased to finally bring closure to the FDIC litigation commenced so long ago."
About Phoenix Investors, LLC, www.phoenixinv.com:
Since 1994 Phoenix Investors has been offering professional management and advisory solutions to public and private companies, trusts, and individual investors. Our management endeavors to understand our clients' individual needs, work with our client to assess specific goals, and structure investments according to our clients' specific risk/reward profile to meet both the clients' short term and long term needs. Our real estate management team professionally manages our portfolio properties through a combination of local and national representation in order to effectively create a "working-bridge" between owner and tenant, building a cooperative mutually beneficial working relationship. Our experts assess and refine our client's portfolio's to maximize our clients cash flow, equity accumulation, and internal rate of return based upon our clients' specific dynamic goals.
Safe Harbor Statement Under the Private Securities Litigation Act of 1995 - With the exception of historical information, the matters discussed in this press release are forward-looking statements that involve a number of risks and uncertainties. The actual future results of the Phoenix Investors could differ significantly from those statements. Factors that could cause or contribute to such differences include, but are not limited to assumptions relating to the marine market and that there will be no unanticipated material adverse change in Phoenix Investor's operations or business.
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