WILLEMSTAD — The bankruptcy of Lovers Industrial Corporation B.V. was not caused by a traditional payment dispute with suppliers, but by an escalating legal and family conflict between shareholders that ultimately paralyzed the company. This emerges from the ruling of the Gemeenschappelijk Hof van Justitie, which overturned an earlier decision and declared the company bankrupt.
The case centers on three closely intertwined parties. Vanddis B.V. is the majority shareholder of Lovers, while Lovers Industrial USA, LLC (LIUSA) holds a minority stake. The shareholders behind Vanddis and LIUSA are family members, a relationship that forms the backdrop to a conflict that became both legally and personally charged.
The immediate trigger for the crisis was a conservatory attachment imposed by LIUSA on December 11, 2025, on assets of Lovers. The attachment was intended to secure a claimed debt of more than USD 3 million, stemming from a dispute over trademark rights and royalties that is being litigated in the United States. Although the measure was formally a legal safeguard, the court found that it had immediate and severe consequences for Lovers’ operations in Curaçao.
Operations Brought to a Standstill
According to Vanddis, the attachment effectively brought the company to a standstill. Banks declared outstanding loans immediately due, the tax receiver placed attachments on movable assets, and nearly all company property was already encumbered by pledges or mortgage rights. As a result, financial room to maneuver disappeared.
Suppliers could no longer be paid, raw materials could not be purchased, and by the end of the month even salary payments were at risk. Machines could no longer be properly maintained, while confidence among customers and employees steadily eroded.
Notably, this assessment was shared not only by Vanddis, but also by Lovers itself. The company argued that initiating summary proceedings to lift the attachment would have little chance of success, as a court would likely find that LIUSA’s claim was not manifestly unfounded and that a balancing of interests would not favor Lovers. In doing so, the company implicitly accepted that the attachment would, at least for the time being, remain legally in place.
Appeal Court Rejects Abuse of Power Claim
The Court of First Instance initially rejected the bankruptcy petition, reasoning that it constituted an abuse of power. In that view, bankruptcy proceedings were being used for purposes other than insolvency protection, such as resolving a shareholder dispute or exerting pressure on LIUSA.
The appeal court took a markedly different stance. It ruled that the statutory requirements for bankruptcy had in fact been met: Lovers was in a state of having ceased payments, and there was a valid claim. The court then explicitly examined whether there was abuse of power and concluded that this had not been sufficiently demonstrated.
Crucially, the court viewed the bankruptcy filing not as a strategic pressure tactic, but as a response to acute and genuine financial distress. The fact that Vanddis was both shareholder and guarantor did not alter that conclusion. Nor did the absence of summary proceedings to lift the attachment or the failure of amicable settlement efforts. Even LIUSA, which imposed the attachment and opposed the bankruptcy, stated that it did not believe Vanddis was acting abusively.
Insolvency as a Last Resort
The ruling illustrates how thin the line can be between shareholder disputes and insolvency law. A legal instrument intended to secure assets in foreign litigation can, in a local context, trigger an irreversible chain reaction. The court implicitly recognized that insolvency law in such circumstances functions not only as a tool for creditor protection, but also as an emergency brake when a company becomes structurally suffocated by legal blockages.
With the bankruptcy now declared and Barbara Nagelmakers appointed as curator, attention shifts to winding up the estate and exploring a possible restart.
A controlled bankruptcy with a potential restart was explicitly cited by Vanddis as the only remaining route to preserve value, jobs and production capacity. Whether such a restart will materialize remains uncertain. What the ruling makes clear is how a legal conflict originating outside Curaçao ultimately undermined the survival of a local manufacturing company.