Atlas Biologicals seeks order preventing discharge of debt in bankruptcy

FORT COLLINS — Atlas Biologicals Inc., a Fort Collins company that produces fetal bovine serum, has filed an adversarial action in the Thomas Kutrubes personal bankruptcy, seeking to prevent the discharge of a court-ordered penalty in Kutrubes’ bankruptcy.

Kutrubes is the founder of Peak Serum Inc., a company formed in 2014 to compete against Atlas, where Kutrubes began his career in 2005. Fetal bovine serum is a byproduct of meatpacking and is derived from cow fetuses; it is used worldwide in biological research and cell generation. 

In 2016, Atlas determined that Kutrubes had stolen customer information and had misrepresented his relationship with Atlas to customers. Atlas sued and won a $2.05 million judgment. Kutrubes appealed and lost.

Kutrubes and Peak Serum filed for Chapter 11 bankruptcy protection — Peak Serum in 2019 and Kutrubes in 2020. The personal bankruptcy filing showed assets of $904,109 and liabilities of $3.6 million, including the judgment that he listed as disputed. The Chapter 11 action was converted to Chapter 7 liquidation Sept. 20, 2023. In Chapter 7, a trustee sells eligible property and pays whatever debts can be covered by it.

On Monday, Atlas filed an adversarial action that seeks to prevent Kutrubes from discharging the court-ordered debt.

The suit contends that the district and appeals court record shows that Kutrubes knowingly and intentionally violated Atlas’ trademarks, copyrights and trade secrets, and that he breached his fiduciary duties with Atlas. The court-ordered debt came as a result of “defendant’s deceit, artifice, trick or design … and was incurred as a result of … false pretenses, false representations and actual fraud,” the filing said.

As a result, the judgment is nondischargeable, the filing said. The action seeks a judgment in Atlas’ favor, plus attorney fees and court courts. 

The bankruptcy case is No. 20-18219 filed in U.S. Bankruptcy Court in Denver. The adversarial case filed within that action is Atlas Biologicals Inc. vs. Thomas Kutrubes.

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