On Monday, the Vermont Public Safety Board (VPSB) threw up a roadblock against Fairpoint Communications’ quest to emerge from bankruptcy with the issuance of a 96- page order that rejects the company’s plan of reorganization. Saddled with debt accruing from its $2.3 billion purchase of landline phone assets from Verizon Communications in 2008, Fairpoint—a regional provider of landline telephone services in the states of Vermont, New Hampshire and Maine—filed for Chapter 11 bankruptcy protection in October of 2009.

Regional landline network operator Fairpoint Communications is finally poised to emerge from Chapter 11 bankruptcy as a result of the decision of the Vermont Public Safety Board (VPSB) to approve the company’s amended reorganization plan. Vermont had been the lone holdout among Maine, New Hampshire and 15 other states that had previously endorsed the plan. The reorganization was precipitated largely by the financial burden of FairPoint’s $2.3 billion purchase of New England landlines from Verizon Communications in 2008.

Today, the Vermont Supreme Court issues its opinion in the Ambassador in Liquidation case striking down the estate’s previously-published 12/31/13 bar date for final Proofs of Claim. The Ambassador Ins. Co. liquidation has been in process since 1987.  After the estate obtained over $300,000,000 in reinsurance and settlement proceeds from its former auditing firm, the estate essentially became “solvent”—paying Priority Four claims at 100 percent (plus interest).