Some 750 lawsuits have been filed against staffing firms and others over outstanding claims in the bankruptcy case of defunct vendor management system provider Ensemble Chimes Global, according to the bankruptcy trustee. The deadline for filing the suits was Jan. 8.

The 750 lawsuits stem from "inquiries/demand letters for preference" that were mailed last year. The letters sought monies paid out by ECG back to 90 days before it filed for bankruptcy. Under bankruptcy law, those payments may have to be returned.

ECG at one time was the largest vendor management system before filing for bankruptcy in January 2008 shortly after its parent company, Axium International Inc. ECG's VMS was sold in bankruptcy court.

Bankruptcy trustee Howard Ehrenberg said $2 million in settlements have already been reached in the ECG bankruptcy case from the demand letters for preference; although the amount represent only a small portion of the total possible claims. Often the cases were settled for much less than the initial demand letters. The 750 lawsuits were filed against companies that didn't respond to the demand letters for preference or did not settle.

Ehrenberg said the 750 lawsuits seek tens of millions of dollars; however, some defendants might have offsets that would reduce their exposure.

Ehrenberg also said a settlement was recently reached with GoldenTree Asset Management, a former lender to Axium.

As a result, Ehrenberg said, GoldenTree will provide the bankruptcy estate with
• $8.5 million in cash;
• a former Axium building at 210 Victory Blvd. in Burbank CA;
• its majority interest in claims against Axium's former auditors, BDO Seidman; and
• it will waive its claims against the estate for assets in the trustee's possession.

Money recovered from the GoldenTree settlement will be used to help pay creditors' claims.