Wellmade Floor Coverings International, Inc.
Sage M. Sigler
U.S. Bankruptcy Court Judge
Date: July 20, 2026
ORDER REGARDING CREDITORS’ MOTIONS FOR LEAVE TO FILE LATE PROOFS OF CLAIM
Debtors owned and operated a profitable flooring manufacturing facility in Cartersville, Georgia. Their bankruptcy filing was triggered not by traditional financial distress, but because their lender called a nonmonetary default after the facility was raided by state and federal1 authorities and certain of Debtors’ owners and/or managers were arrested in connection with
The deadline to file proofs of claim in this bankruptcy case was November 21, 2025, and dozens of Debtors’ workers and former workers filed proofs of claim before the deadline. But before the Court are three motions and related proofs of claim filed pro se by Bo Deng, Gengxu Wang, and Haitao Li (together, “Movants“) between June 1 and June 8, 2026, requesting that the Court allow their late-filed claims (Docs. 393, 394, and 395, collectively, the “Motions“).
The Court held an initial hearing on the Motions on June 17, 2026, at which Mr. Li appeared in person and Mr. Deng appeared via zoom, but the Court was unable to conclude the hearing without a Mandarin interpreter. The Court continued the hearing to July 16, 2026, and2 directed any party wishing to participate in the presentation of evidence to appear in person.3 The
I. BACKGROUND
Wellmade Industries MFR. N.A. LLC and Wellmade Floor Coverings International, Inc. (collectively, “Wellmade” or “Debtors“) commenced voluntary cases under chapter 11 of title 11 of the United States Code in the United States Bankruptcy Court for the Northern District of Georgia on August 4, 2025 (the “Petition Date“), and retained Kurtzman Carson Consultants, LLC d/b/a Verita Global (“Verita“) as their claims and noticing agent (Doc. 29).
A. Bar Date and Notice
On September 4, 2025, Debtors sought an order setting a bar date for filing proofs of claims (Doc. 137, the “Bar Date Motion“). Both the Committee and several claimants objected to the Bar Date Motion, arguing the proposed form and manner of notice would not effectively apprise workers of the bar date or the process for filing claims. See Docs. 169, 171. After lengthy, contested hearings, the Court approved a bar date notice and proof of claim form that was primarily in English, but included summary information in both Chinese and Spanish (Doc. 222, the “Bar Date Notice” and, together with the proof of claim form, the “Claim Package“). Debtors also published a notice of the Bar Date in Mandarin in the World Journal.4
(i) Haitao Li
Haitao Li worked at the Wellmade facility from May 21, 2024, through May 23, 2025. See Doc. 395. On June 1, 2026, Mr. Li filed Claim No. 142 in this bankruptcy case in the amount of $152,015.10.5 On June 9, 2026, Mr. Li filed his Motion requesting the Court allow his late filed claim. Mr. Li presents two reasons he did not timely file his proof of claim. First, Mr. Li alleges he did not receive notice from Debtors about the bankruptcy case or the Bar Date Notice. Rather, Mr. Li alleges, he learned that other former Wellmade workers were asserting wage related claims against the company in January 2026 and learned about the bankruptcy filing in May 2026.6
Second, Mr. Li alleges he retained attorney Aaron Halegua to represent him, but Mr. Halegua confused him with another claimant, resulting in Mr. Li being misled to believe that he was part of a group of workers settling their claims with Debtors. But at the July 16 hearing, Mr. Li indicated that he did not wish to rely on this argument and instead relied on his assertion that he did not receive notice of the Bar Date in support of his Motion.
The record in this case and Debtors’ submitted evidence indicate that Mr. Li was served with the Bar Date Notice via U.S. mail and email, and neither was returned to Debtors as undeliverable. See Doc. 233, Ex. C and E and Docket No. 419. Specifically, Mr. Li was served
But according to Mr. Li‘s uncontroverted testimony, Mr. Li had not lived at 66 Seminole Rd. since May 23, 2025.7 It is undisputed that 66 Seminole Rd. is company housing for Wellmade‘s workers and Wellmade was aware, or should have been aware, that Mr. Li did not reside at that address when the Claim Package was mailed in October 2025. Mr. Li could not recall whether or when he provided Wellmade with his updated address, but Wellmade mailed Mr. Li‘s 2025 Form W2 to Mr. Li‘s current address.
Mr. Li also never received the emailed notice sent to 891771095@qq.com. Mr. Li‘s uncontroverted testimony was that he provided that email address in the presence of a Wellmade translator who accompanied him to open a bank account, but that he never used the email address and that workers were directed by a Wellmade factory manager not to use the QQ email messaging app in the U.S., so he deleted the app from his phone.
Bo Deng worked at the Wellmade facility from July 2022 through March 2024 and from June 3, 2024, through November 25, 2025. See Doc. 393. On June 6, 2026, Mr. Deng filed Claim No. 145 in this bankruptcy case in the amount of $4,954,774.35.8 On June 8, 2026, Mr. Deng filed his Motion for Leave requesting the Court allow his late filed claim. Mr. Deng provides several arguments as to why he did not timely file his proof of claim. First, Mr. Deng alleges he “never saw the bankruptcy notice before the bar date” and that because “nobody asked [him] to sign for [the Claim Package] he “had no way of knowing it had arrived.” Id.
Second, Mr. Deng alleges that even if he had seen the Bar Date Notice, he had no way of understanding it because he has limited English-language skills and Wellmade‘s alleged poor treatment towards him made him believe he “had no rights [he] could assert.” Id. Third, Mr. Deng alleges he reached out to Mr. Halegua in January 2026 to inquire about representation, but that Mr. Halegua responded in February 2026 telling Mr. Deng that “it was too late for [him] to join the case.” Id. Mr. Deng alleges he had “no way to find another attorney” due to the language barrier.
Mr. Deng did not present evidence at the July 16 hearing,9 but made extensive arguments to the Court consistent with those made in his papers, asserting that he was unable to timely file a proof of claim because of his inability to read or speak English and the control that Wellmade exerted over him while he was living in company housing.
Unlike Mr. Li, however, Mr. Deng acknowledges he received the Claim Package but did not open it or look at the Bar Date Notice until he found it while moving out of company housing months after the Bar Date had passed. Mr. Deng also indicated that the email sent by Debtors was “filtered into a spam folder and was not seen before the Bar Date.” Doc. 421.
II. LEGAL STANDARD
A. The Pioneer Factors
A creditor‘s late filed claim may be allowed by a bankruptcy court if the creditor can prove his failure to timely file was the result of excusable neglect. Whether “neglect of a deadline is excusable” to justify allowing the late claim depends upon “all relevant circumstances surrounding the party‘s omission.” Pioneer Inv. Servs. Co. v. Brunswick Assocs. Ltd. P‘ship, 507 U.S. 380, 395 (1993). Specifically, a court should weigh four factors: (i) the danger of prejudice to the debtor, (ii) the length of the delay and its potential impact on judicial proceedings, (iii) the reason for the delay, including whether it was within the reasonable control of the movant, and (iv) whether the movant acted in good faith. Id.
The Eleventh Circuit and the courts under it have emphasized that the determination of excusable neglect is ultimately an equitable one that requires consideration of all the factors set
B. Burden of Proof
“As the party seeking relief, the creditor seeking to file a late proof of claim bears the burden of proving excusable neglect by a preponderance of the evidence.” In re Cable & Wireless USA, Inc., 338 B.R. 609, 613 (Bankr. D. Del. 2006); see In re Graham Bros. Const., Inc., 451 B.R. 646, 650 (Bankr. S.D. Ga. 2011) (applying the preponderance of the evidence standard to an excusable neglect determination).
Movants aver, in part, that they did not receive or did not know they received notice of Debtors’ bankruptcy case or the Bar Date Notice. A properly addressed and mailed letter is presumed to “be delivered to the addressee in a timely manner.” In re Hobbs, 141 B.R. 466, 468 (Bankr. N.D. Ga. 1992) (citing Hagner v. United States, 285 U.S. 427, 430 (1932)); In re Harrell, 325 B.R. 643, 648 (Bankr. M.D. Fla. 2005). This presumption is rebuttable, but “mere denial of receipt is insufficient to rebut the presumption.” In re Hobbs, 141 B.R. at 468. A bar date notice is adequate if “it was reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action.” In re Vital Pharms., Inc., No. 22-17842, 2026 WL 1529022, at *7 (Bankr. S.D. Fla. May 29, 2026) (citing Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306, 314 (1950)); see also In re Energy Future Holdings Corp., 619 B.R. 99, 108 (Bankr. D. Del. 2020) (“The proper inquiry in evaluating notice is whether a party acted reasonably in selecting means likely to inform persons affected, not whether each person actually received notice.“) (citations omitted).
D. Inadvertence, Ignorance, or Mistake
Courts have held that inadvertence, ignorance, or mistake do not constitute excusable neglect. See In re Belcher, 293 B.R. 265, 268-69 (Bankr. N.D. Ga. 2001) (holding debtor-plaintiff‘s misunderstanding of the temporal limitations for filing a notice of appeal did not constitute excusable neglect); MedCross Imaging, 2023 WL 4111563, at *6 (stating plaintiff‘s “mistaken understanding” of local rule did not justify failure to conduct discovery and weighed against argument for excusable neglect); Matter of Jones, No. 16-12590-WHD, 2017 WL 562434, at *1-2 (Bankr. N.D. Ga. Feb. 10, 2017) (finding no excusable neglect where pro se debtor was unaware the certificate of service had to be received by the court, not merely mailed, by the
III. ANALYSIS
Mr. Li requests that the Court allow his late-filed claim on the basis that he did not receive the Bar Date Notice and was unaware of the bankruptcy filing until shortly before he filed his Motion. Mr. Deng requests that the Court allow his late-filed claim because while he did receive the Bar Date Notice, he did not look at it until after the Bar Date had passed and, even if he had, he would not have been able to understand it. Under
(i) Prejudice to Debtors
Unquestionably, denying Movants’ Motions would prejudice them in that they would not be entitled to any distributions under the Plan. Instead of completing a simple claim form that could be liquidated in this Court, Movants would need to wait to the conclusion of this bankruptcy case and file suit in U.S. District Court seeking to recover against whatever surplus is returned to Wellmade and/or its equity holders post-bankruptcy. But Movants bear the burden of proving the late filing of their claims will not prejudice Debtors. As explained above, this is one of the factors of “primary importance” in the Court‘s consideration in the Eleventh Circuit. Several factors contribute to the Court‘s determination of whether a late-filed claim will prejudice a debtor, including:
- whether the debtor was surprised or caught unaware by the assertion of a claim that it had not anticipated;
- whether the payment of the claim would force the return of amounts already paid out under the confirmed Plan or affect the distribution to creditors;
- whether payment of the claim would jeopardize the success of the debtor‘s reorganization;
- whether allowance of the claim would adversely impact the debtor actually or legally; and
- whether allowance of the claim would open the floodgates to other future claims.
In re Energy Future Holdings Corp., 619 B.R. 99, 112 (Bankr. D. Del. 2020).
First, claims in the nature of those filed by Movants should be no surprise to Debtors as they result from the allegations underlying the raid on Debtors’ facility and related arrests that prompted this bankruptcy filing. Second, Debtors have not confirmed a plan and have not initiated distributions to creditors under a plan. As to the third and fourth factors, Debtor‘s Disclosure Statement (Doc. 386) has not yet been approved, and while approval is set for hearing on July 21, 2026, the pending objection filed by the creditors’ committee indicates that Debtors are already in
Whether allowing the late-filed claims would force Debtors to reformulate its plan to address the claims may be a more complicated question, with potentially different answers for the claims of Mr. Li and Mr. Deng. As filed, the Plan (Doc. 385) includes classes of priority and unsecured creditors. There is a separate class of Labor Plaintiffs (defined in the Plan) that treats a particular group of workers who reached a joint settlement with Debtors, but as the Court already explained to Movants, the Court cannot rewrite that settlement to include additional parties. Instead, Debtors’ Plan would presumably treat Movants as priority and/or unsecured creditors. But the Plan currently proposes to pay all claims in full, and the impact Movants’ claims may have on Debtors’ ability to do so is not clear.
The late claims as filed differ by an order of magnitude. Mr. Li‘s claim is approximately $150,000 and Mr. Deng‘s is nearly $5 million. While it may be unlikely that allowing Mr. Li‘s claim, even in its full amount, would impede Debtors’ ability to pay all claims in full under the Plan, Mr. Deng‘s asserted claim could conceivably tip the scales such that Debtors could no longer pay all claims in full. Were such a hypothetical to come to fruition, unimpaired classes under the Plain could become impaired, and Debtors would have to reformulate their plan, materially delaying the plan process and distributions to creditors. And while Mr. Deng has indicated that he would like to mediate his claim with Debtors as the Labor Claimants have successfully done, the sheer amount of his claim suggests that liquidating his claim may require protracted litigation. Debtors have not completed their claims allowance process, and neither this hypothetical nor the
Finally, the Court is not concerned that allowing the late filing of these claims would open the floodgates to additional requests for late-filed claims by other former Wellmade workers. Based upon the filings and arguments of Movants, there was clearly a flurry of communications about claims against Wellmade amongst the workers in January 2026, and again in May 2026 shortly before Movants filed their Motions. No additional late claims have been filed since Movants’ claims, suggesting to the Court that all workers intending to file claims have already done so. Further, this Order in no way suggests that any additional late-filed claims will be allowed. Such allowance depends entirely on the facts surrounding that specific claim, and if Debtors’ notice to such claimant was reasonably calculated to provide notice of the Bar Date, the claim is unlikely to be allowed. Additionally, the plan process is underway, so any future analysis of the Pioneer factors may differ as this case progresses.
Mr. Li has demonstrated by a preponderance of the evidence that allowing his late-filed claim would not cause significant prejudice to Debtors. Mr. Deng, however, has failed to meet his evidentiary burden and based on the record before the Court, allowing his claim is likely to prejudice Debtors by delaying the plan process and potentially impacting, both in time and amount, distributions to other creditors.
(ii) Length of Delay and Impact on Proceedings
While more than 6 months passed between the Bar Date and the filing of Movants’ Motions and claims, Mr. Li demonstrated, by a preponderance of the evidence, that he filed his Motion within weeks of learning about Debtors’ bankruptcy cases and the Bar Date in May 2026. Mr. Li credibly testified that while he was aware other workers were asserting overtime claims against
It is unclear from the record when Mr. Deng became aware of the bankruptcy case or the Bar Date, but he argues that Mr. Halegua informed him in February 2026 that the “Debtors were unwilling to negotiate or mediate with any worker who had not filed a proof of claim before the November 21 Bar Date,” indicating that Mr. Deng was aware of these proceedings and the Bar Date no later than February 2026. See Doc. 421. Mr. Deng further argues that he sought the assistance of lawyers, social workers, and others following his February communications with Mr. Halegua, but the record reflects that he waited over three months before filing anything with the Court. It is impossible to know whether Debtors would have been willing to negotiate with Mr. Deng had he approached them in February, months before the Plan was filed, but the case has now progressed, the plan process has begun, and allowing Mr. Deng‘s late-filed claim may materially delay, if not entirely derail, the Plan as set forth in more detail above.
(iii) Whether the Delay was Within Movants’ Control
a. Mr. Li
The delay between the Bar Date and the filing of Mr. Li‘s Motion was not within his control. As detailed above, Mr. Li was unaware of the bankruptcy case until May 2026, shortly before he
While it may, in some situations, be reasonable and the best course of action for a debtor to mail notice to a former employee‘s last known address, mailing notice to Mr. Li at a company-owned property that Debtors knew he vacated was not “reasonably calculated” to provide notice to Mr. Li as required. During the extensive proceedings leading to the entry of the Bar Date Order, the Court expressed the importance of Debtors providing notice to employees and former workers and imposed requirements on Debtors to locate former workers through staffing agencies or otherwise. There were also extensive discussions regarding the best means of electronic notification for the workers. The Labor Plaintiffs’ counsel argued that the workers should be notified via WhatsApp chats that Wellmade and its management regularly used to communicate with the workers. But Debtors objected and the Court approved the email manner of service suggested by Debtors based on Debtors’ representation that they had valid email addresses for most, if not all, workers. But the uncontroverted evidence now before the Court is that Wellmade‘s management instructed workers not to use qq.com email addresses in the U.S. and to delete the app from their phones. Mr. Li followed that instruction and did not receive electronic notice of the Bar Date as a result. Again, Debtors should have known that emailing workers at qq.com email addresses was not “reasonably calculated” to provide notice to workers who had been instructed not to use that email service. Debtors also point to the Court-approved publication notice in this
The Court understands the difficulties debtors face in finding appropriate contact information for potential creditors. But the workers are the primary creditors in this case and, with respect to Mr. Li, Debtors were obligated to do more to locate him. Debtors should have reviewed all parties being served at company-owned housing to confirm they still lived in that company-owned housing. If such parties were not current employees, it would have been obvious they did not live in company housing. And if Debtors were unable to locate workers who had vacated company-owned housing, they could have contacted the workers via WhatsApp to request their contact information, or they could have requested guidance from the Court on how to proceed.
b. Mr. Deng
Mr. Deng, on the other hand, did live in company housing at the time the Claim Package was mailed and actually received it via U.S. Mail. But he failed to open the mail and/or look at the Bar Date Notice until months after the Bar Date passed. Mr. Deng argues that he would not have been able to understand the Bar Date Notice even if he looked at it because it was primarily in English and the one paragraph in Chinese did not explain specifically that workers could assert claims for backpay or human trafficking violations. While the Court is sympathetic to Mr. Deng‘s position, the Debtors complied with their obligations to provide Mr. Deng with notice of the Bar
While the Notice was predominantly in English, the Chinese paragraph specifically referenced workers at the Wellmade factory in Cartersville, Georgia and directed them to file any claims they believed they had against Wellmade in the bankruptcy case before November 21, 2025, providing a link to do so electronically. The claim form itself also contained Chinese translations of much of the content. Further, Mr. Deng has demonstrated an impressive ability to interpret and analyze filings in this case using artificial intelligence and other online translation resources. The Court has no doubt that had Mr. Deng opened Claim Package and endeavored to understand the Bar Date Notice, he could have. And while Mr. Deng is correct that the Bar Date Notice and claim form did not expressly reference wage/overtime or human trafficking claims, it is neither a requirement nor customary for a debtor‘s claim form and bar date notice to provide examples of what types of claims creditors may file. Indeed, the Bar Date Notice‘s specific reference to workers is beyond what is typically required.
Mr. Deng points to In re Roman Cath. Diocese of Syracuse, in further support of his Motion, arguing in essence that he had suffered trauma and was still under the control of Wellmade at the time he received the Bar Date Notice and therefore would not have been able to timely file a claim even if he read the Notice. 638 B.R. 33 (Bankr. N.D.N.Y. 2022) (allowing a late-filed claim of a victim of sexual abuse on the basis that confusion over different claim deadlines and the claimant‘s past trauma prevented the claimant from timely filing a claim). The Court does not discount Mr. Deng‘s alleged suffering, but his argument is purely hypothetical; we cannot know what Mr. Deng would have done had he opened the Claim Package. And because Mr. Deng did not present evidence at the hearing, there is simply no evidence in the record to support his position.
(iv) Good Faith
Debtors argue that Movants have not acted in good faith in seeking to have their late-filed claims allowed, but there is simply no evidence or indication in the record that Movants have acted other than in good faith. Both Mr. Li and Mr. Deng immediately reached out to lawyers and other organizations for assistance when they learned they could assert claims against Wellmade. Any delay in filing the Motions with the Court was a result of confusion or a lack of understanding of the process, not bad faith. This is the fourth of four factors weighing in favor of allowing Mr. Li to pursue his claim against Debtors but is the only factor weighing in Mr. Deng‘s favor, and good faith alone is not sufficient to satisfy the Pioneer requirements in the Eleventh Circuit.
IV. CONCLUSION
Serious labor and human trafficking violations have been asserted against Debtors by dozens of their workers. Three workers have now come forward, more than six months after the deadline to file claims in these cases, seeking to have similar claims allowed in this case. While the Court is sympathetic to the complications these workers have faced in trying to navigate this legal process in a language that is not their own, the Court is obligated to apply well-established law to the facts before it. Specifically, claimants seeking to receive a distribution from the bankruptcy estate on a claim filed after the deadline must establish that the circumstances of their lateness constitute “excusable neglect” under the factors articulated by the Supreme Court in Pioneer.
Also, the denial of Mr. Wang and Mr. Deng‘s Motions is not a determination that their claims are invalid. It means only that they are not entitled to any distribution from Debtors’ bankruptcy estates.11 The Bankruptcy Code does not grant a discharge to liquidating corporate Chapter 11 debtors, and Debtors’ counsel has represented on the record that Debtors’ Plan does not seek to circumvent this limitation. See
For the foregoing reasons, it is
ORDERED that Mr. Wang‘s Motion (Doc. 394) is DENIED for want of prosecution and Claim Nos. 143, 146, and 147 are DISALLOWED as untimely; and it is further
ORDERED that Mr. Li‘s Motion (Doc. 395) is GRANTED to the extent that Claim Nos. 142 and 148 are deemed timely filed.
END OF DOCUMENT