According to a statement issued to the Arkansas Democrat Gazette by East Cotton Co. of Marion, the company, fearing that Reinhart will not be able to honor it contracts, is readying for a lawsuit to recover losses of up to $50 million for farmers in the region, by requiring the services of two Memphis-based attorneys, Randy Fishman of Ballin, Ballin & Fishman, and Barry Ward of Glankler Brown PLLC.
"A large percentage of cotton farmers involved have committed to provide the funding for the lawsuit, which is being prepared against Reinhart and its parent companies and a consortium of banks." the issued statement said.
Attorneys for the Reinhart companies and the potential defendant banks have requested to meet Fishman and Ward, according to the issued statement.
According to the Paul Reinhart Inc. Web site, River Bend Warehouse was established in July of 2002 as a joint venture between Paul Reinhart Inc., and Michael East of East Cotton Co. The warehouse is used as a consolidation point for Paul Reinhart Inc. The company receives cotton year round and ships all over the world.
Several attempts to contact Reinhart Inc. in Richardson, Texas on Wednesday, Oct. 8, 2008, for a comment were unsuccessful.
Phillip Williams of Arbyrd Cotton CO-OP stated, "There is cotton stored at our facility that we ship out daily to them (Reinhart)." The dealings I have with them right now are going okay.
"Payments have been on time, and they are paying better than other merchants," Williams said.
Gregg Sain of the Graves Gin in Kennett remarked, "All I have heard is the rumors, there are no farmers at this gin are involved with Reinhart."
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