For the little guys, casino’s bankruptcy is a bad deal

Monday, June 5, 2000 | 5:08 a.m.

The Glenns, owners of wholesale fish seller Randall's Seafood, have been holding a bill for $7,096 ever since the casino filed for bankruptcy protection 2 1/2 half years ago.

"You do business with the Sands, you figure 'Here's a casino that's been in business for years, they're big enough to pay their food bills,"' said Al Glenn, 34, shaking his head. "We were wrong."

The couple and their business were among hundreds caught in the middle as the Sands sought protection from its creditors. The idea was to keep the doors open, the dice rolling and the slot machines jingling.

But small businesses like Randall's Seafood suffered in the meantime. Some were owed as little as $25, some as much as $600,000.

"It's almost three years since many of them have been paid a dime (by the Sands)," said Eric Browndorf, a lawyer for the casino's unsecured creditors committee.

Vendors, bondholders and other claimants had until 5 p.m. Monday to submit ballots containing their votes for either Icahn or Park Place, which have submitted competing bids to take over the 532-room casino.

Results of the voting were not available Monday.

About 1,500 merchants are owed $6.7 million by the casino, which filed for protection under Chapter 11 of the U.S. Bankruptcy Code on Jan. 5, 1998.

Icahn plans to invest $65 million in the troubled property and issue $110 million worth of new bonds; Park Place has proposed investing $40 million and issuing $128 million in bonds.

Whoever wins the vote is expected to gain control of the casino. A confirmation hearing is scheduled for June 20 before U.S. Bankruptcy Judge Judith Wizmur in Camden.

The resolution can't come too quickly for the Glenns. Like other unsecured creditors, they were left holding debts.

The couple bought Randall's Seafood in June 1997, taking over a small six-employee business that sits on the waterfront of Lakes Bay, just across the salt marshes from Atlantic City.

Buying directly from fishing boats and clammers, Randall's Seafood sells to restaurants, retailers and casinos.

They sold a small amount of oysters and flounder to the Sands for the first six months they owned the business. Then in December 1997, the Sands was suddenly their best customer.

The casino ran up a $7,000 bill in just one month. The Glenns thought they'd hit it lucky. Then the bottom fell out. They picked up the newspaper on Jan. 6, 1998, to learn the casino had filed for bankruptcy.

"You would hear they had a bad quarter, but we thought nothing of it. I guess were out of the loop," said Jodi Glenn, 28. She suspects that the sudden increase in sales was a result of the casino's other seafood vendors being warned beforehand that bankruptcy was imminent.

The big IOU spelled trouble. The couple had just bought a new refrigerated truck and was contemplating adding refrigerating space in the building.

Randall's Seafood had no collateral to show for its $7,096 - and dim prospects for recovering it. After all, says Al Glenn: "You can't repossess something that's been eaten."

The couple didn't have to lay off any employees, but the business has still barely recovered from the loss, the Glenns said. "When you're small, it hurts a lot more than when you're big," Jodi Glenn said.

Meanwhile, they waited as the casino and its employees continued to get paid and the U.S. Bankruptcy Court agreed to let the Sands spend $20 million on renovations while the case dragged on.

"They don't lose anything, but we've lost everything," Jodi Glenn said.

As unsecured creditors, the Glenns have a say in who takes over the casino next, though. They voted for Park Place Entertainment, gambling that the company's track record and local ties will bode better for them and other Atlantic City businesses than would Icahn's.

"We'd be in a lot better shape if this hadn't happened," Jodi Glenn said.