Lost Valley Farm Files For Chapter 11

Lost Valley Farm filed Chapter 11 bankruptcy late last week. Oregon's newest large dairy filed those bankruptcy papers, just a day before thousands of its cattle were set to be sold to repay a major creditor.  Because of the bankruptcy, Friday’s auction was called off.

Earlier this month, an Oregon judge ordered the dairy owner, Greg te Velde, to cooperate with an auction.  The creditor, Rabobank, sued seeking to foreclose on the dairy's assets, which serve as collateral for $60 million in defaulted loans.  Lost Valley Farm began operating last year, over the objection of environmentalists who feared the big dairy would be a polluter.  The state earlier this year accused the dairy of endangering drinking water by mismanaging manure and wastewater. The sides reached a settlement in March, allowing the dairy to continue operations in a limited capacity.

Thursday's bankruptcy petition filed in California stays all foreclosure actions by creditors including the auction. Te Velde also has operations in California.

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