Smith International Wins Extension on Debt Plan Proposal

Smith International Inc., the Newport Beach-based oil services company which last March filed for protection under Chapter 11 of the U.S. Bankruptcy Code, on Monday received an extension to Dec. 31 to propose a plan to reorganize its debt.

The deadline for submitting a plan would have expired this month. The extension was granted at Smith’s request by U.S. Bankruptcy Judge James R. Dooley, who accepted the company’s argument that the case was exceptionally large and complicated. In addition, Dooley noted that because Hughes Tool’s $204.8-million patent award against Smith is under appeal, it would be difficult at this time to determine how much money Smith will have to distribute to its other creditors.

Dooley approved extension of the planning deadline until Dec. 31 despite opposition from Hughes, which wanted to give Smith only 30 days’ additional time.

In other action Monday, the judge instructed the U.S. trustee to appoint a committee to represent the shareholders in Smith’s bankruptcy reorganization. He also instructed a committee already appointed to represent Smith’s unsecured creditors to keep confidential all information it receives about Smith’s finances unless the company or the court grants a release.