WSJ – Mabus Has Ties To Bankruptcy

Obama’s pick for the new secretary of the U.S. Navy, Ray Mabus, has served as governor of Mississippi and the U.S. ambassador to the Kingdom of Saudi Arabia. He’s won awards for public service, for supporting education and for conserving wildlife. But it’s his stint in the private sector that may be of interest to Bankruptcy Beat readers: Mabus led Foamex International Inc. out of its first Chapter 11 bankruptcy proceeding as the company’s president and chief executive.

Mabus, who on May 19 was sworn in as the Navy’s 75th secretary, presided over Foamex’s exit from February 2007 exit from bankruptcy protection. Mabus was appointed interim president and chief executive of the company in June 2006, well into its Chapter 11 case. He left the company in April 2007 to, as the company said at the time, “return to his home in Mississippi.” He had been commuting to Foamex’s Pennsylvania headquarters.

Mabus, however, can’t close the book on his time at Foamex just yet. On June 9, the U.S. Bankruptcy Court in Wilmington, Del., is slated to consider another former CEO’s request to continue with a lawsuit against Mabus and another former company official. Thomas Chorman filed the lawsuit in Foamex’s first bankruptcy case, accusing Mabus and then-Chief Restructuring Officer Gregory J. Christian of giving him the boot so they could take on his duties and his $718,000 annual salary.