Hostess, union to give mediation one last try. Can Twinkies be saved? (+video)
A judge asks Twinkies maker Hostess and union lawyers to participate in mediation Tuesday to resolve their differences. If they fail, bankruptcy motions will resume Wednesday and 18,000 jobs will be lost.
As Hostess Brands tried to convince a New York bankruptcy judge to help the company shut down its business Monday – a move expected to put 18,000 employees out of work – the maker of Twinkies and other iconic American snacks was asked to participate in one final mediation session with the union to prevent it from shutting its doors for good.
Judge Robert Drain of the US Bankruptcy Court in White Plains, N.Y., asked attorneys representing Hostess and the Baker, Confectionary, Tobacco Workers and Grain Millers’ International Union to participate in mediation Tuesday.
If the talks prove unsuccessful, Judge Drain said, the bankruptcy motions will resume Wednesday.
“To me not to have gone through [mediation] leaves a huge question mark over this case, which I think – I may be wrong – but I think will only be answered in litigation. And that’s no one’s desired outcome,” he said.
The mediation session Tuesday will be confidential, but Drain said representatives from the International Brotherhood of Teamsters and representatives from Hostess’s creditors could attend.
Hostess arrived in bankruptcy court after saying that a week-long strike by the bakery union, which began Nov. 9, gave them no choice but to liquidate assets. At stake are 36 bakeries, 242 distribution depots, 216 retail outlets, and 311 other facilities. Three days into the strike, the company, based in Irving, Tex., permanently closed three plants in St. Louis, Cincinnati, and Seattle.