EAD Constructors, Inc.

IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF NEBRASKA
In the Matter of:
EAD CONSTRUCTORS, INC.
Debtor.
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Case No. 25-81134-BSK
Chapter 11
Findings and Conclusions for Temporary Allowance of
Claim No. 14 for Plan Voting Purposes
PURAC America, Inc. d/b/a Corbion filed a motion to allow its claim for
purposes of accepting or rejecting the debtor’s Chapter 11 plan. Lauren
Goodman appeared for the debtor EAD Constructors, Inc. Sam King
appeared for Corbion. Corbion’s motion is granted in part. Corbion’s claim is
allowed, solely for voting purposes under Bankruptcy Rule 3018(a), in the
amount of $2,390,840.1
Corbion requests to vote its claim in the filed amount of $40,781,928. The
record does not support allowance of the entire claim. The claim includes
$13,088,936 for contingent indemnity against subcontractor liens Corbion
itself disputes, implicating 11 U.S.C. § 502(e)(1)(B). It includes $2,026,853 in
attorneys’, expert, and arbitration fees the record does not support. It
includes $19,932,000 in liquidated damages, computed through a forecast
completion date assuming a December 2025 arbitration award. On Corbion’s
theory, they continue to accrue. And the claim includes damages not
established on this record.
Likewise, the record does not support the debtor’s request to allow the claim
at $0 or some nominal amount. The debtor’s own experts calculate Corbion’s
gross damages at $7,970,383 and net damages at $1,175,651 after the unpaid
contract value is applied. The debtor reaches zero only by further netting its
own disputed and unliquidated counterclaim.
1 The debtor and Corbion are arbitrating Corbion’s claim. On March 5, 2026, Corbion
was granted relief from the automatic stay to continue the arbitration.
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Jurisdiction
This court has jurisdiction under 28 U.S.C. §§ 157 and 1334. This is a core
proceeding under 28 U.S.C. § 157(b)(2)(A), (B), and (L). Venue is proper under
28 U.S.C. § 1409. To the extent any matter determined is non-core, the
temporary and non-preclusive character of this order makes final
adjudication unnecessary.
Legal Standard
“The holder of a claim or interest allowed under section 502 of this title may
accept or reject a plan.” 11 U.S.C. § 1126(a). A filed proof of claim is “deemed
allowed, unless a party in interest . . . objects.” Id. § 502(a). “Even if an
objection to a claim or interest has been filed, the court may, after notice and
a hearing, temporarily allow a claim or interest in an amount that the court
considers proper for voting to accept or reject a plan.” Fed. R. Bankr. P.
3018(a)(4).
The inquiry is summary. It is not allowance under 11 U.S.C. § 502(b) and not
an adjudication of the merits. Temporary allowance is discretionary. It
guards against plan proponents who might ensure acceptance of a plan by
last-minute objections. Armstrong v. Rushton (In re Armstrong), 294 B.R. 344,
354 (B.A.P. 10th Cir. 2003). It also keeps an unliquidated claim from
controlling a vote it cannot yet justify. Bell Road Inv. Co. v. M. Long Arabians
(In re M. Long Arabians), 103 B.R. 211 (B.A.P. 9th Cir. 1989); In re Goldstein,
114 B.R. 430 (Bankr. E.D. Pa. 1990).
A proof of claim filed under the rules is prima facie evidence of the claim’s
validity and amount. Fed. R. Bankr. P. 3001(f). An objector must come
forward with substantial evidence. McDaniel v. Riverside Cnty. Dep’t of Child
Support Servs. (In re McDaniel), 264 B.R. 531, 533 (B.A.P. 8th Cir. 2001). The
claimant bears the burden of proof once the claim is rebutted. Gran v. IRS (In
re Gran), 964 F.2d 822, 827 (8th Cir. 1992). Courts apply the same allocation
under Bankruptcy Rule 3018(a). See Armstrong, 294 B.R. at 354.
The parties dispute the method for temporary allowance. The debtor relies on
Bittner v. Borne Chem. Co., 691 F.2d 134 (3d Cir. 1982), which held
estimating a disputed claim at zero was not an abuse of discretion. Corbion
urges the probability-weighted approach of In re Windsor Plumbing Supply
Co., 170 B.R. 503 (Bankr. E.D.N.Y. 1994), and In re Ralph Lauren
Womenswear, Inc., 197 B.R. 771, 775 (Bankr. S.D.N.Y. 1996). Either is within
the court’s discretion. In re Chemtura Corp., 448 B.R. 635, 648–49 (Bankr.
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S.D.N.Y. 2011). Neither fits this record. An all-or-nothing estimate requires
the court decide the central question in the arbitration: which party breached
first. And it must do so solely on a written evidentiary record. A probability-
weighted estimate requires probabilities. Neither party offered any. Instead,
Corbion generically asserts a “high probability” of success. Corbion does not
quantify it.
Corbion’s claim has several components. This order determines each
component largely based on the contract, the undisputed facts, or the debtor’s
own evidence. Where a component cannot be determined on this record, it is
excluded. In one component, the cost to correct defective work, the debtor’s
expert’s figure is partly provisional. The figure Corbion’s expert offered is
used after removing the one item the record does not resolve. The result is
conservative. It discounts Corbion’s claim without requiring the court invent
a probability, and it gives Corbion a vote measured largely by what the
debtor’s own evidence supports.
The evidence primarily consists of portions of the parties’ contract and
portions of the expert reports the parties obtained for their pending
arbitration. The record does not include live witness testimony or significant
deposition testimony. The debtor’s expert evidence rebuts the presumption of
validity on each contested component, so Corbion bears the ultimate burden.2
But the debtor’s own evidence also sets a floor its objection cannot go below.
Findings and Conclusions
The debtor contracted with Corbion to expand Corbion’s lactic acid facility in
Blair, Nebraska.3 The written agreement provides for the full engineering,
procurement, and construction of the project, and the agreement is titled
Engineering, Procurement and Construction Agreement (the “EPC
Agreement”). For the engineering component the debtor hired a related
entity, EAD Engineering.
2 Corbion contends the debtor’s objection lacks the “specific grounds” required by
Neb. R. Bankr. P. 3007-1(B). The rule governs the debtor’s objection to Corbion’s
claim, which is not before the court. For the temporary valuation of Corbion’s claim,
the debtor’s expert reports supply specific grounds.
3 Proof of Claim 14-1. All contract terms, including those under the EPC Agreement
and the GMP Amendment, are in documents attached to Corbion’s proof of claim.
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Compensation for the project is on a cost of the work plus fee basis subject to
a guaranteed maximum price. The contractor’s fee is 4.00%. Savings are
shared 75% to Corbion and 25% to the debtor. Under the GMP Amendment
executed March 11, 2022, the parties fixed a guaranteed maximum price of
$34,228,106, including a contingency of $2,605,832. Approved changes
reduced the total to $34,126,620.
The GMP Amendment contains two milestones, which, if not met, impose
liquidated damages:
Milestone 	Required Date 	Rate 	Grace
Partial Completion 	January 16, 2023 	$1,000/day 	21 days
Substantial Completion 	April 24, 2023 	$15,000/day 	28 days
Articles III.C and III.D of the EPC Agreement provide that liquidated
damages “shall substitute for any other damages . . . due only to the delay.”
The debtor did not achieve either milestone.4 On or about July 5, 2023, a city
building inspector determined the debtor had not obtained a structural
building permit.5 The debtor stopped working and demobilized on July 14,
2023.6 The project has not been completed. Corbion has not hired a
replacement contractor to complete the project.7 To date Corbion has paid the
debtor $27,331,888.8 Subcontractors filed construction liens against the
property. The liens are the subject of litigation in Nebraska state court.9
Corbion filed Claim No. 14 in the amount of $40,781,928. The claim has three
primary components: $25,666,139 in net liquidated and other damages,
$2,026,853 in attorneys’, expert, and arbitration fees, and $13,088,936 for
Corbion’s contingent indemnity for unpaid subcontractor liens.10
4 Doc. #67-9, § 1; Doc. #212-6, Tables 13-14; Doc. #214, ¶ 6.
5 Doc. #212-2, § 7.1; Doc. #67-8, § VI(B)(1).
6 Doc. #212-6, § 4.1; Doc. #67-9, § 4.4; Doc. #214-1, Att. B.
7 Doc. #67-9, § 1; Doc. #212-2, Summary; Doc. #212-6, n.82.
8 Doc. #67-9, § 5.4; Doc. #212-3, Sch. A; Doc. #212-4, Note 5.
9 Doc. #67-9, § 1; Doc. #131.
10 Proof of Claim 14-1; Doc. #202, ¶ 25.
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The parties offered reports from five teams of experts.11 Corbion’s experts are
HKA Global, which opines as to delay and cost, and The Vertex Companies,
which opines as to defects. The debtor’s experts are Delta Consulting as to
delay, Arup as to defects, and Capital Project Management, Inc. (“CPMI”) as
to damages. Because the experts did not testify, credibility determinations
are neither made nor intended.
The debtor summarized its calculation of Corbion’s claim in a one-page
comparison chart labeled “Exhibit G.”12 From the debtor’s perspective,
Exhibit G computes Corbion’s claim at negative $2,096,026. Exhibit G’s
structure is sound. This order follows it:
Comparison of Corbion’s Damages
Category of Damages 	Corbion’s
Position
Debtor’s
Position
Liquidated Damages 	$19,932,000 	$2,380,000
Costs Incurred to Continue Construction
Scope
$756,876 	$620,191
Costs To-Go to Complete Construction Scope 	$7,088,034 	$4,632,302
Remediation / Deficiencies 	$4,683,961 	$337,890
Less: Unpaid Unapproved Change Orders 	$0 	($3,271,677)
Less: Unpaid Contract Value 	($6,794,732) 	($6,794,732)
Corbion’s Total Damages 	$25,666,139 	($2,096,026)
The debtor reaches a negative number by subtracting $3,271,677 in
unapproved change orders. Without the subtraction, the debtor’s own experts’
11 Doc. #67-8; Doc. #67-9; Doc. #212-1 to -6; Doc. #214-1; Doc. #214-2. Both the debtor
and Corbion expressly limited the purposes for which their reports were offered. The
debtor’s reports are offered “solely for the purpose of showing the Court that
Corbion’s claim . . . should be estimated at $0,” with privilege reserved. Doc. #212,
¶ 5. Corbion’s reports are similarly limited. Doc. #214, ¶ 4. Some expert source data
was withheld as voluminous but is “available upon the Court’s request.” Doc. #212,
¶ 3. Corbion also offered to submit under seal the “Owner’s Project Criteria and Basis
of Design,” an exhibit to the EPC Agreement not attached to its proof of claim.
12 Doc. #212, ¶ 4; Doc. #212-7, Ex. G.
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figures yield net damages of $1,175,651.13 Therefore, the debtor’s $0 figure
rests entirely on netting.
Liquidated Damages
The contract documents expressly provide for liquidated damages. All but one
input is fixed by the EPC Agreement and the GMP Amendment. These
documents set the daily rates, the grace periods, and the required completion
dates. The total days are not set and are heavily contested. The record
contains five plausible results:
Basis 	Days
(Partial /
Substantial)
Amount
1. Accrued as of July 14, 2023, stoppage14 	179 / 81 	$953,000
2. The debtor’s state court pleading15 	Not stated 	$1,440,000
3. Delta’s analysis assuming the debtor is not
responsible for leaving the site16
241 / 172 	$2,380,000
4. Delta’s analysis assuming the debtor is
responsible for leaving the site17
253 / 184 	$2,572,000
5. The debtor’s June 26, 2023, schedule
update18
282 / 213 	$3,036,000
The debtor’s own figure, $2,380,000, is adopted.19 The debtor’s brief describes
it as the liquidated damages “attributable to the Debtor” if the debtor was not
13 Gross damages of $7,970,383, minus $6,794,732 equals $1,175,651.
14 Doc. #214-1, Att. B & n.35.
15 Id., § 4.2.1.1.
16 Doc. #212-4, Opinion 1 & Sch. A, Note 1.
17 Id. Responsibility for leaving the site accounts for 12 days. Id., Opinions and
Conclusions 1.
18 Doc. #67-9, § 1; Doc. #214-1, Att. B & n.35.
19 HKA Global, on behalf of Corbion, describes $3,036,000, derived from the debtor’s
June 26, 2023, schedule update, as “a minimum.” Doc. #214-1, Att. B. The $656,000
difference between that figure and the amount adopted is the 41-day postponement of
power forward, about which the facts are disputed. ($3,036,000 − $2,380,000 = 41 ×
($1,000 + $15,000)). Arup and Delta blame Corbion for the delay. Doc. #212-2, § 7.2.1;
Doc. #212-6, § 4.1.2. Vertex blames the debtor. Doc. #214-2, § V.A.8. Worden, the
project’s structural engineer of record, was equivocal. Doc. #229, Ex. A, Worden Dep.
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responsible for the demobilization. It is Delta’s analysis as priced by CPMI,
and it is the amount the debtor carries in Exhibit G. It does not require
resolution of disputes over methodology. And it does not require resolution of
who bears responsibility for the period after the debtor left the job site.
The debtor contends Corbion may recover only if the debtor did not breach
first. See Weber v. N. Loup River Pub. Power & Irr. Dist., 854 N.W.2d 263,
273 (Neb. 2014) (holding that, generally, a party who failed or refused to
perform contract terms “cannot recover for a breach thereof by the other
party”). But its damages expert does not apply the limitation.20 CPMI
calculates $2,380,000 and assumes the debtor was not responsible for leaving
the site. The debtor’s own experts, in their written reports, charge this delay
to the debtor even if Corbion’s non-payment justified demobilization.
Whether any breach by Corbion excused the debtor’s further performance is a
question for the arbitration panel. The amount adopted does not depend on
the answer.
The bases for liquidated damages in Rows 1 ($953,000) and 2 ($1,440,000) of
the above chart are not adopted. Row 1 stops the count on the day the debtor
left the site, even though the debtor’s own delay expert charges the debtor
with delay through the forecast completion date. Row 2 is a figure the debtor
used in a state court pleading, and it does not state a count of days.
Corbion’s expert, HKA Global, calculates liquidated damages of $19,932,000
using a forecast completion date assuming an arbitration award in December
2025, a date expressly “subject to change.”21 The chosen date passed without
an award. The final hearing is now set for March 8, 2027. On this reasoning,
the damages grow until the project is completed after the arbitration.
Corbion’s approach cannot be sanctioned on this record. Corbion offered no
evidence fixing when completion reasonably should have occurred. Corbion
did offer some evidence explaining why the period was protracted: the project
was “red-tagged” and EAD Engineering refused to address the outstanding
94:24–95:2, 92:14–18 (testifying fire protection issues had to be addressed before
power forward but also that he “could have satisfied” the building inspector). The
contested portion is left for the arbitration panel.
20 Doc. #212-4, Note 1.
21 Doc. #67-9, § 1 & n.71; Doc. #212-4, Note 1.
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issues.22 But the explanation itself is disputed and unquantified. Arup’s
report states temporary structural permitting, valid through September
2023, was “promptly obtained.”23 Corbion offered no evidence of whether and
when the red tag was lifted. It did not describe meaningful efforts to engage a
replacement engineer of record. Instead, it “chose to wait” given various
uncertainties.24
The debtor asserts “Corbion’s liquidated-damages figure is unenforceable as a
penalty” and argues Corbion does not account for mitigation, citing Browning
Ferris Indus. of Neb., Inc. v. Eating Establishment-90th & Fort, Inc., 575
N.W.2d 885, 888–91 (Neb. Ct. App. 1998). They challenge accrual running
years past any reasonable completion date. These arguments are directed at
Corbion’s $19,932,000 figure. The amount adopted ends at Delta’s forecast
completion date of December 5, 2023, and includes only delay the debtor’s
own experts charge to the debtor. Corbion responds that no duty to mitigate
arises where a liquidated damages clause is enforceable, citing Aramark
Unif. Servs. v. Meylan Enters., Inc., 2007 WL 1532329, at *6 (Neb. Ct. App.
May 29, 2007). Neither side’s arguments are decided.
Costs Incurred to Continue Scope
For damages for the costs to continue the debtor’s scope of work, Corbion’s
expert states $756,876; the debtor’s $620,191.25 This element of damage
should largely be a question of fact, not opinion. The element consists of
funds expended. It does not require estimation. Invoices should exist.
Corbion, which bears the burden, did not offer them into evidence. Therefore,
$620,191, the amount asserted by the debtor, is adopted.
Costs to Complete
For damages to complete the project, Corbion’s expert states $7,088,034; the
debtor’s $4,632,302.26 The debtor’s lower figure rests, in part, on escalating
costs to August 2023 rather than March 2025.27 The debtor chose its endpoint
22 Doc. #228, ¶ 6.
23 Doc. #212-2, § 7.1.
24 Doc. #67-9, § 4.4.
25 Id., § 5.2 & Att. B; Doc. #212-4, Opinions & Note 2.
26 Doc. #67-9, § 5.3 & Att. B; Doc. #212-4, Opinions & Note 3.
27 Doc. #212-4, Note 3; Doc. #212-6, § 6.3.1, ¶¶ 150, 157.
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based on the premise that Corbion should have immediately continued the
project. Corbion escalated to March 2025 because it was “the most recent
data available.”28 The debtor’s number is adopted, but not its underlying
premise.
As noted, Articles III.C and III.D make liquidated damages substitute for
damages “due only to the delay.” Cost escalation attributable to the passage
of time is damage due only to the delay. The debtor’s figure excludes the
escalation after August 2023. Corbion has not addressed Articles III.C and
III.D. The debtor’s figure is adopted without further reduction.
Cost to Correct Defective Work
For costs to correct allegedly defective work, Corbion’s expert states
$4,683,961; the debtor’s $337,890.29 Neither figure is adopted.
The debtor’s expert, Arup, calculates its figure by reclassifying several
alleged deficiency items as unfinished contract work, owner-directed changes,
or items it could not evaluate.30 Arup places $161,928 in a category of items
with insufficient information for a complete assessment “at this time,” and
the debtor’s damages expert states those amounts “will be adjusted.”31 Arup’s
number is expressly not final and cannot be adopted as a valuation.
Corbion relies on Vertex, which calculates $4,683,961.32 Vertex starts with
four line items of direct costs totaling $2,878,800, and a fifth, scaffolding,
charged at 7.42% of items 1 through 4. Vertex adds a fixed contractor-
supervision allowance of $193,200 (42 weeks at $4,600) and grosses up the
result with successive markups for general conditions at 8.00%, overhead and
profit at 10.00%, and contingency at 20.00%.
Line item 1 charges the debtor $2,044,485 for “structural permit issues.” The
item does not include permit fees. It consists of items such as engineer-of-
record review and redesign ($1,093,964), weld and bolt testing ($197,730),
and structural steel inspection forms ($752,791), which Vertex ties to
28 Doc. #67-9, § 5.3.1.1; Doc. #212-4, Note 3.
29 Doc. #67-9, § 1 & Att. B; Doc. #212-4, Opinions.
30 Doc. #212-2, § 9.1.5; Doc. #212-6, § 4.5.
31 Doc. #212-2, § 9.1.5 & Table 1; Doc. #212-4 at 4 n.5 & Note 4.C.
32 Doc. #67-8, § VIII(A)(5) & App. III.
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replacing the engineer of record after the debtor left and to satisfying
building-permit requirements.33 Vertex relies on GC-6(a) of the EPC
Agreement: “All permits and licenses shall be secured and paid for by
Contractor, unless otherwise specified, and shall be reimbursed by Owner as
a Cost of Work. . . .”34 But GC-3.3.7 of the same agreement may otherwise
specify. It provides “Owner is responsible for obtaining and maintaining all
permits applicable for the Project. . . .” Neither party’s expert addressed both
provisions. It is not clear how a permit clause covers redesign and testing.
Whether these costs are the owner’s permitting costs or the cost of correcting
the debtor’s structural work cannot be resolved on this record. Because this
item cannot be resolved, Vertex’s number is adopted after deducting it.
Without line item 1, the first four line items total $834,315. Scaffolding
becomes $61,906 for a subtotal of $896,221. Adding Vertex’s $193,200
supervision allowance and applying its general conditions, overhead and
profit, and contingency markups results in $1,553,079.35
Attorneys’, Expert, and Arbitration Fees
No attorneys’ fees, expert fees, or arbitration fees are determined or allowed.
Corbion claims $1,567,896 in arbitration attorneys’ and expert fees, $330,187
in fees defending the lien foreclosure action, and $128,770 in American
Arbitration Association filing and arbitrator fees. The record does not include
an invoice, a fee itemization, or a single time record. No declaration
addresses reasonableness. The evidence on this record does not allow the
amount to be fixed. Temporary allowance requires an amount. See Fed. R.
Bankr. P. 3018(a)(4).36
33 Doc. #67-8, § VI(B)(1), at 48-49; § VII, at 74–75; App. III, at 136-37.
34 Id., § VI(B)(1), at 48.
35 Id. at 136, 154. The debtor disputes several markups and the amounts. Experts on
both sides address them.
36 The debtor also contends GC-24(b) reaches fees only if the underlying breach is
established, GC-24(c) excludes loss caused by Corbion’s own fault, and Nebraska law
does not permit recovery of attorneys’ fees under a contractual indemnity provision.
See Havelock Bank of Lincoln v. W. Sur. Co., 352 N.W.2d 855, 859 (Neb. 1984).
Corbion responds the arguments were untimely and argues Nebraska law permits an
indemnitee to recover fees incurred defending claims within the indemnity. See Select
Food Mart Inc. v. Abeesha, Inc., 2020 WL 6514337 (D. Neb. Nov. 5, 2020). Neither the
arguments nor the response is reached.
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Contingent Indemnity for Subcontractor Liens
No amount is allowed for Corbion’s claim of $13,088,936 for indemnification
for subcontractor liens. The lien claims have not been paid. Corbion itself
disputes them. Again, temporary allowance requires an amount. The court
cannot supply one for a wholly contingent claim which no expert valued and
which may be subject to mandatory disallowance under 11 U.S.C.
§ 502(e)(1)(B).37
Corbion argues a contingent claim should be discounted by the probability
that the contingency will occur rather than estimated at zero. See In re FV
Steel & Wire Co., 372 B.R. 446, 454 (Bankr. E.D. Wis. 2007). The principle is
sound. But applying it requires evidence of probability. Corbion offered none.
The provision Corbion relies on, GC-24(b).2 of the EPC Agreement, excepts
liens “due to Owner’s wrongful failure to pay Contractor.” The contingency
turns on the payment question the parties are arbitrating.
The debtor entered a stipulation with five subcontractors, fixing their claims
against the debtor at a total of $7,063,427.38 This stipulation does not
establish Corbion’s liability. Including the amounts in the indemnity
component would allow the same debt twice for voting purposes. The
subcontractors may vote them.
Unpaid Contract Value
The parties do not dispute the unpaid contract value. It is $6,794,732,
calculated as the difference between the adjusted guaranteed maximum price
of $34,126,620 and payments of $27,331,888.39
Unapproved Change Orders
In Exhibit G, the debtor reduces Corbion’s claim by $3,271,677 for 165 items
the debtor classifies as change orders Corbion has not approved.40 The
37 The court expressly reserves, for purposes of allowance, whether § 502(e)(1)(B)
requires disallowance and the extent to which the indemnity claim duplicates the
subcontractors’ claims.
38 Doc. #131.
39 Doc. #67-9, § 5.4; Doc. #212-4, Note 5.
40 Doc. #212-3, Opinions & Sch. A; Doc. #212-5, §§ 2.1 & 4.4; Doc. #212-7, Ex. G.
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amount comes from a spreadsheet the debtor prepared.41 Its experts rely
upon it.42 The spreadsheet is not a log of change orders. It tracks every cost
the debtor incurred over budget: 464 items totaling $8,937,565.43 The debtor
classified the 165 items, totaling $3,271,677, as “change order entitlement.”44
The amount of the change order claim has not been stable. In July 2023 the
debtor listed more than 200 items totaling more than $4,500,000.45 And at
least four versions of the spreadsheet exist.46
Only a few requests went through the formal change order process stated in
the contract.47 The parties dispute why. The debtor contends Corbion directed
it to give notice of changes rather than submit change orders.48 Corbion
contends most requests were not submitted until June 2023, shortly before
the debtor left the site, and were waived because the debtor did not make
written requests as required.49 No expert for the debtor values the requests
individually or addresses notice. CPMI takes the amounts from the
spreadsheet and disclaims entitlement and technical evaluation.50 Delta
41 In its brief the debtor calls the spreadsheet a “contemporaneous project record
cataloguing every variance and change event,” but two versions are dated June 2025.
Doc. #214-2, § IV. And one of the columns is titled “EAD Themes for Arbitration.”
Doc. #242, Ex. A, Col. C.
42 Doc. #242, ¶ 3 & Ex. A; Doc. #212-3, Note 2 & n.6 (CPMI); Doc. #212-5, ¶ 42 & n.31
(Delta); Doc. #212-1, § 4 (Arup).
43 Doc. #242, Ex. A, Cell L504.
44 Id., Ex. A, Cell L529. Delta uses the 165 / 299 division, and 16 causal categories
corresponding to the spreadsheet’s “themes.” Doc. #212-5, ¶¶ 42–44 & n.32.
45 Doc. #67-1 at 9.
46 Doc. #214-2, § IV (noting versions dated May 31, 2023; July 17–20, 2023; June 26,
2025; and June 30, 2025).
47 The spreadsheet contains a status for 11 of the 165 requests: five submitted, four
rejected, and two approved, one of which is a $105,048 credit to Corbion. Doc. #242,
Ex. A, Col. AG.
48 Doc. #212-5, § 4.3, ¶¶ 38–41.
49 Doc. #214, ¶ 7; Doc. #214-2, § IV.A; Doc. #228, ¶ 11.
50 Doc. #212-3, Scope; Doc. #212-4, Scope.
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opines on entitlement by category but disclaims amount.51 Arup opines on
scope and entitlement but disclaims value and “the method of notification.”52
Finally, the debtor already billed part of the change order claim to the project
contingency, which is part of the guaranteed maximum price. The
spreadsheet shows $1,256,611 of the 165 requests billed against the
contingency.53 Corbion paid $811,892 of those billings.54 The remaining
$444,719 is part of the unpaid contract value already credited to the debtor.
It appears netting the full $3,271,677 would credit the debtor a second time
for $1,256,611 it has already been paid or credited.
The change order claim is therefore disputed as to entitlement, notice, and
amount, and $1,256,611 of it has already been paid or credited. It is also the
estate’s own affirmative claim, preserved by the debtor’s plan as the “Corbion
Project Litigation,” asserted as part of the debtor’s construction lien at
$8,245,755, and valued in the plan’s liquidation analysis as part of a total
claim against Corbion for up to $11,000,000.55 Netting it against Corbion’s
claim would require adjudication of the estate’s affirmative case in the
debtor’s favor at a summary hearing on temporary allowance of a creditor’s
claim. The court declines.
Other reasons support declining to net. This order treats the debtor’s
evidence as an admission countering its position that Corbion’s claim should
be set at $0. Netting would use the debtor’s evidence in the debtor’s favor to
establish its own claim. And netting in this manner is effectively recoupment.
“Recoupment allows a defendant to deduct its claim from the amount the
plaintiff could otherwise recover if the claim arises out of the same
transaction or subject matter on which the plaintiff sued.” Terry v. Standard
Ins. Co. (In re Terry), 687 F.3d 961, 963 (8th Cir. 2012). Recoupment is an
affirmative defense, and “[t]he burden of proof on matters raised in use of
recoupment, is on the [party] who raises them.” Universal Pontiac-Buick-
GMC Truck, Inc. v. Routson (In re Routson), 160 B.R. 595, 612 (Bankr. D.
Minn. 1993). The debtor has not carried its burden on this record. Also,
51 Doc. #212-5, § 1.2.
52 Doc. #212-1, Executive Summary.
53 Doc. #242, Ex. A, Cells M529 to P529.
54 Id., Ex. A, Cell M529.
55 Doc. #67-9, n.9; Doc. #208-3, Ex. 3.
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netting requires an amount, which the court declines to determine in this
summary proceeding.
Final Calculation
Applying the foregoing:
Component 	Amount
Liquidated Damages 	$2,380,000
Costs Incurred to Continue Scope 	$620,191
Costs to Complete 	$4,632,302
Cost to Correct Defective Work 	$1,553,079
Attorneys’, Expert, and Arbitration Fees 	$0
Contingent Indemnity 	$0
Unpaid Contract Value 	($6,794,732)
Corbion’s Total Damages 	$2,390,840
This calculation departs from the debtor’s Exhibit G in two respects: the cost
to correct defective work and the netting of the debtor’s unapproved change
orders.
Conclusion
Claim No. 14 of PURAC America, Inc. d/b/a Corbion is temporarily allowed in
the amount of $2,390,840 solely for the purpose of accepting or rejecting the
debtor’s plan under Bankruptcy Rule 3018(a). This order does not allow or
disallow the claim under 11 U.S.C. § 502(b). Its findings are not preclusive
and are not binding on any arbitration panel, any state court, or this court for
purposes of final allowance.
Dated: October 13, 2026
BY THE COURT:
/s/ Brian S. Kruse
Brian S. Kruse
Chief Bankruptcy Judge
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