Reporting Anjali Hemphill
SACRAMENTO – (CBS13/AP) It looks like Hostess may not be going out go of business just yet.
Hostess Brands Inc. and its second largest union will go into mediation to try and resolve their differences, meaning the Irving, Texas-based company won’t go out of business immediately, as it announced last week.
The news came Monday after Hostess moved to liquidate and sell off its assets in bankruptcy court citing a crippling strike last week.
The bankruptcy judge hearing the case says that the parties haven’t gone through the critical step of mediation and asked the lawyer for the bakery’s union to ask his client, who wasn’t present, if he would agree to participate.
The case is being heard by the U.S. Bankruptcy Court in the Southern District of New York in White Plains, N.Y.
Nearly 200 workers at the Hostess plant in Sacramento could have their jobs saved if Hostess stays in business, but one striking worker told CBS13 on Monday that no deal would be reached unless the workers’ pensions were restored.
Walter Dahl, a Sacramento bankruptcy lawyer, said the judge was likely concerned about 18,000 workers immediately losing their jobs and may be looking to slow the process
The mediation will begin on Tuesday.