Matt Daneman, USA TODAY
NEW YORK - Nineteen months later, Eastman Kodak Co. is all but done with one of the most traumatic periods of its life.
A federal bankruptcy judge Tuesday approved the company's Chapter 11 bankruptcy reorganization plan.
For Kodak, Tuesday was a great moment, as that approval means no hurdles are left before Kodak can actually end its bankruptcy and resume operations as essentially a new company.
But for many of the people who became collateral damage in the bankruptcy, such as Kodak creditors, retirees and shareholders, Tuesday was undoubtedly not a day of celebration.
"Many are losing their retirement benefits," U.S. Bankruptcy Court Judge Allan Gropper said as he dismissed a slew of objections to the Kodak plan. "Many are finding their recovery as a creditor is just a minute fraction of what their debt is from Kodak. (Kodak's) decline and bankruptcy is a tragedy of American economic life."
Kodak tentatively hopes to leave bankruptcy Sept. 3. "Closing is complicated, but we're cautiously optimistic," said Andrew Dietderich, an attorney with Kodak's legal counsel, Sullivan & Cromwell.
On that date, Kodak will be largely free of U.S. Bankruptcy Court oversight, meaning every significant contract or business deal doesn't first require court approval. That date also would be when the company's Document Imaging and Personalized Imaging businesses get officially turned over to their new owner - the pension plan representing Kodak's United Kingdom workers and retirees.
Kodak will continue to manufacture and supply camera film for the Personalized Imaging business, which aside from camera film also includes Kodak's photo kiosk business. Its Document Imaging business is primarily its document scanner line. That date also will see Kodak's board largely replaced by a group of nine people.
In a prepared statement, Kodak CEO Antonio M. Perez called the decision a critically important step in the bankruptcy process. "Next, we move on to emergence as a technology leader serving large and growing commercial imaging markets - such as commercial printing, packaging, functional printing and professional services - with a leaner structure and a stronger balance sheet.
"There are additional transactional steps ahead as we complete our Chapter 11 restructuring," Perez said in the statement, "but with the court's decision today, our emergence is now imminent."
Kodak came into Tuesday's U.S. Bankruptcy Court hearing with sizable momentum. One big win behind it came as Kodak announced last week that a majority of its various creditors had signed off on the company's turnaround plan. The official committee representing unsecured creditors also is backing the plan.
But Kodak faced a variety of opposition Tuesday in the form of objections from a group of retirees, from a number of former Kodakers, and from the wing of the U.S. Justice Department overseeing the bankruptcy. Several handfuls of Kodak shareholders also filed roughly 200 objections to various aspects of the plan.
Much of the hearing was taken up by addressing those various objections, including a lengthy back-and-forth between a shareholder cross-examining outside consultants hired by Kodak about how they arrived at the various values of Kodak's estimated worth.