Munn Works LLC, a Mount Vernon fine art and mirror framing firm, filed for Chapter 11 bankruptcy to protect the business while it fights a $2.1 million trial verdict in favor of a precursor company.
The bankruptcy petition identified the largest unsecured creditor as APF Management Co. but disputed the verdict that APF won last October in Westchester Supreme Court.
“Munn Works has a viable, profitable business,” Max Munn, the CEO, said in a declaration filed on June 26, “and has explored every option to resolve the dispute.”
APF, he claimed, rejected several settlement offers and made no counter-offers.
APF traces its history to 1955 as a craft shop that fabricates frames for high-end mirrors and fine art. The Metropolitan Museum of Art, the Museum of Modern Art and the Smithsonian Institute have been among its customers.
Max Munn, a framer for more than 35 years, is connected to both companies: He was APF”™s CEO for years.
In 2011, the company, then known as APF Group, was acquired in bankruptcy by APF Management, half owned by the Petrillo family ”“ Gregory and Matthew and their father, Carl ”“ and half by Munn”™s daughter, Molly.
APF does business as APF Master Framemakers and also uses the Munn name, proclaiming on its website that “there is only one APF Munn.”
Max Munn worked for the new company, but in 2012 he and his wife, Laurie, founded Munn Works to sell fine art on the internet.
APF then reduced his salary to $100,000 from $250,000, he said in the declaration, and decided to discontinue selling mirrors to the hotel and hospitality industry.
“Once APF Management ceased serving the market for framed mirrors,” he stated, “Munn Works filled the void.”
The companies have been fighting ever since.
APF sued the Munns, claiming that Munn Works was formed to compete against APF and solicit its customers. The Munns countersued over various claims.
The jury ruled for APF.
The Munns asked the court to set aside the verdict and rule in their favor, claiming that the evidence did not support the verdict and that APF”™s attorney had tainted the trial with inflammatory statements.
Justice Charles D. Wood rejected their position.
“The court finds that the jury”™s verdict could be reached from a fair interpretation of the evidence,” Wood ruled on March 31, “and thus should not be disturbed.”
Munn Works has appealed the decision, but Max Munn”™s declaration stated the company has insufficient cash reserves to fund the bond for the appeal.
The bankruptcy petition was filed to stop APF from collecting its judgment and enable Munn Works to pursue the appeal and to preserve the business “as a going concern.”
