The Louisiana Department of Revenue and the State of Louisiana’s Department of Natural Resources filed with the U.S. Bankruptcy Court separate objections to Saratoga Resources’ Joint Chapter 11 Plan of Reorganization.
The Department of Natural Resources asserts, “Because Harvest Oil and Gas et al has illegally retained funds belonging to the State, the State hereby objects to confirmation of the Plan, as there is no provision contained within the Plan that would credit the State with the funds being held on its behalf. The State’s royalty was at no time owned by the Debtor. Debtors have retained wrongful possession, but do not have legal or equitable title to the State’s royalty interest.”
The objection continues, “Therefore, at no time did the royalties wrongfully retained by the Debtors become part of the Bankruptcy Estate. Further, because the State is not a creditor with respect to these funds, but the owner of these funds, the State’s request for their return is not in the nature of any type of ‘claim’ against the estate of the Debtors. The State is simply seeking return of its property wrongfully appropriated by the Debtors.”
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