Spongetech Public Auction Wins Court Approval

Law360, New York (March 16, 2011, 7:42 PM EDT) -- A New York bankruptcy judge on Tuesday approved a public auction of the assets of scandal-plagued and bankrupt sponge maker Spongetech Delivery Systems Inc.

Under the terms of the auction procedures, the initial overbid is $550,000, and subsequent bids must increase by increments of $10,000, according to an order issued by Judge Stuart M. Bernstein of the U.S. Bankruptcy Court for the Southern District of New York.

The trustee will pay a breakup fee of $25,000 to the stalking horse offeror if another bidder succeeds, according...
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