Wachovia had until July 18 to file an appeal of Judge M. Bruce McCullough's order, which appoints Marc Kirschner of New York as liquidating trustee.
Kirschner has until Nov. 1 to file lawsuits against Wachovia and other parties that creditors blame for the beverage maker's bankruptcy, which they allege was caused by widespread fraud.
A federal grand jury has been investigating former LeNature's CEO Greg Podlucky and other former executives for money laundering, as well as bank, wire and mail fraud, according to court records.
The duty of a liquidating trustee is to recoup the losses suffered by creditors.
Because LeNature's assets are limited, Kirschner will sue the parties he believes are responsible for losses -- estimated at about $800 million.
A spokesman for Charlotte, N.C.-based Wachovia, the nation's fourth-largest bank, did not respond to a request for comment.
Over the past 18 months, bank attorneys have waged a dogged effort to thwart plans by creditors to appoint Kirschner. He will open an office in Pittsburgh but said he has not decided where the lawsuits will be filed.
LeNature's debacle is similar to the collapse of New York-based Refco Inc., once the biggest independent U.S. futures trader. Refco collapsed in October 2005, two months after having raised $670 million in an initial public offering.
On July 7, former Refco CEO Phillip Bennett was sentenced to 16 years in prison for defrauding investors out of $2.4 billion in what U.S. prosecutors said was "among the very worst" white-collar crimes. Bennett pleaded guilty in February to bank fraud and money laundering, stemming from his eight-year scheme to deceive banks, auditors and investors.
Kirschner, also the trustee in the Refco case, has filed lawsuits against two dozen individuals and companies alleging complicity in the fraud. He is seeking $2 billion in claims.
Kirschner is investigating similar allegations involving LeNature's.
Podlucky and other former executives are alleged to have made the bottling company appear to be growing and successful. Podlucky went to Wall Street and borrowed $278 million from Wachovia, which underwrote another $150 million in bonds for LeNature's.
Instead of generating hundreds of millions in revenue as the company claimed, however, LeNature's earned only $32 million in its best year.
Kirschner will investigate allegations that Wachovia's bankers knew about the financial problems within LeNature's but failed to inform other lenders to whom the bank sold the loans to reduce its own liability.
In addition to Wachovia, Kirschner will investigate the roles of accounting firms Ernst & Young and BDO Seidman and Pittsburgh law firm K&L Gates, and what role, if any, they had in failing to detect the alleged fraud.
Spokesmen for both accounting firms said they are victims of fraud just as the creditors are. A spokesman for K&L Gates did not respond to a request for comment.
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