Henry Dunay's Creditors, Bankruptcy Plan Revealed

As the Chapter 11 bankruptcy case of jewelry design company Henry Dunay Design continues, court documents show new details on its creditors, the genesis of its financial problems and its plans for the future, which include possibly being sold.

In an affidavit filed on Thursday in U.S. Bankruptcy Court for the Southern District of New York, the company's president and sole owner Henry Dunay said his company's Chapter 11 filing "was precipitated by various events including a decline in jewelry sales corresponding with the national economic downturn, the decision of Neiman Marcus Group to take setoffs and not remit approximately $3 million in funds owed for goods, and bank termination of credit lines necessary to fund ongoing operations."

The filing states that the majority of Henry Dunay's assets are held on consignment with Neiman Marcus Group, which is also listed as a secured creditor in the case. According to the filing, the company's only other secured creditor is Capital One N.A.

A listing of its top 20 unsecured creditors also was filed on July 2.

The top five are: Elian Gem Inc., of New York, with an unsecured claim of $382,247; Jaguar Jewelry Castings LLC, of New York, $343,769; New York real estate firm Drummond and Hill Inc., $295,971; John Parrish Photography Inc., of Dallas, $246,431; and Pac Team, a Lausanne, Switzerland-based watch company, with a $126,665 claim, which is listed as disputed.

Henry Dunay, which said it had a total of three full-time employees as of the petition date, originally filed for Chapter 11 bankruptcy protection in late June.

As the case moves forward, the documents filed on July 2 state that Henry Dunay "believes the protections afforded by Chapter 11 will enable it to solicit offers for the sale of the business as a going concern or to obtain an equity investment in the company, which will enable the debtor to effectively reorganize and restructure the business. Accordingly, the debtor believes that Chapter 11 will preserve the value of its assets for the benefit of its creditors."

According to the filing, New York-based Henry Dunay- which does business out of offices located on West 48th St. in Manhattan-has been in business since 1965 as a manufacturer and wholesaler of jewelry crafted in gold, platinum, diamond and colored gemstones. Its product is sold to retail jewelry chains and major department stores, including Bergdorf Goodman.

Dunay also is noted for outfitting A-list celebrities with his designs, including talk show queen Oprah Winfrey and actor Tom Cruise.