Court Says FundAmerica Will Have Assets Sold Off

FundAmerica, the controversial Irvine consumer marketing company, will be liquidated and most of its remaining assets sold at a public auction later this month, it was decided in bankruptcy court Tuesday in Santa Ana.

The company’s Chapter 11 bankruptcy trustee said he has already received a $1-million offer from a Canadian company controlled by the attorney for FundAmerica founder Robert T. Edwards.

Meanwhile, one-time FundAmerica president Mitchell Blumberg said Tuesday that he may attempt to outbid the Canadian firm, which is legally known as 394109 British Columbia Ltd. and is controlled by Vancouver attorney George Davis.

U.S. Bankruptcy Court Judge James N. Barr has scheduled the auction for May 24.

“I think it is unlikely with the assets on hand I should try a reorganization of the debtor,” court-appointed trustee Theodor Albert told Barr, adding that the company was spending about $60,000 a week just to stay open despite a sizable staff layoff last week. “I think it is imprudent for the estate to burn through the funds,” he concluded.

FundAmerica now has about $1 million in assets.

Albert was appointed last month after a power struggle erupted between the company’s management--including Blumberg and Chairman Peter Bradshaw--and Edwards loyalists.