By Anthony Silva, WBZ NewsRadio 1030 News England Business Editor

BOSTON (CBS) – A bankruptcy court judge ordered Hostess to begin mediation and resolve its differences with the union. That union, the second largest at Hostess, had refused to accept a second round of pay cuts.

WBZ NewsRadio 1030’s Anthony Silva reports

In court, company lawyers had also requested $2 million in pay incentives and bonuses for its top 20 officials to oversee the liquidation, but the Justice Department objected.

Mirick-O’Connell bankruptcy lawyer Joseph Baldiga thinks the government figures if the company is going to throw in the towel and liquidating, then the bankruptcy ought to be converted to a Chapter 7, with an impartial trustee named.

Baldiga says an outcome cannot be forced on Hostess. He thinks the order is recognition by many of the parties, and the judge in particular, that it is worth one last effort to keep Hostess whole.

Hostess attorneys wanted permission to close down operations and start laying off more than 18-thousand employees across the company.


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