SPRINGFIELD – A trustee representing creditors owed money by 4Run3 Racing is asking the U.S. Bankruptcy Court to claw back $176,924 in race proceeds paid to the St. Patrick’s Parade Committee of Holyoke.
That payment was made in the weeks before 4Run3 shut down and followed insistent demands from a parade committee official, who at one point confronted an owner of 4Run3, saying, “(it) feels like you lied to me many times.”
The court demand was outlined in an “adversary proceeding” filed late last week.
On Wednesday, trustee Joseph H. Baldiga will be back in bankruptcy court asking a judge to freeze the St. Patrick’s Parade Committee’s accounts to ensure the money isn’t spent while the case proceeds.
There is no allegation the parade committee did anything wrong.
But Baldiga, a partner at the Mirick O’Connell law firm in Westborough, said it’s his job to make sure all creditors in the bankruptcy “share and share alike” from whatever money is available and that no one should be paid out of turn.
It’s not fair, he says, for the St. Patrick’s Parade Committee to get paid the proceeds of its road race. “When everybody else got stiffed,” he said.
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In a written statement in response to questions from The Republican, the committee said it is aware of the filing.
“We have retained counsel to represent our interests. Committee volunteers have been hard at work since last March to plan for the 72nd Holyoke St. Patrick’s Parade and St. Patrick’s Day Road Race that will happen in March 2025.”
There will be no further comment, the email said. A call to David Ostrander, a Northampton attorney representing St. Patrick’s Committee of Holyoke, went unanswered.
Text messages
Text messages included in the bankruptcy court filing show the St. Patrick’s Parade Committee — responsible for a major regional attraction with an economic impact greater than $20 million a year — was working hard to get that $176,924 payment from the 2024 race, saying it had bills to pay.
The road race draws around 6,000 runners to Holyoke each year.
According to the filing, 4Run3 paid the St. Patrick’s Parade Committee after getting a $90,000 loan from Mulligan Funding. That loan carried with it a 59.86% interest rate.
A check written April 26 was rejected by the bank on April 30 due to insufficient funds. On May 1, 4Run3 also got a $30,000 line of credit from New Valley Bank & Trust in Springfield, according to court papers.
A second check was good.
A bankruptcy trustee appointed by the court, Baldiga said he is aware the Holyoke parade and road race are charities out to do good in the community.
“I have to keep reminding myself and I keep reminding the Holyoke folks that that is true for most of the creditors as well who didn’t get paid,” he said.
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As a business, 4Run3 helped set up races, providing timing and equipment while also collecting donations and registration fees. It closed abruptly in May along with an associated running shop in East Longmeadow also owned by husband-and-wife Timothy D. Murphy and Jill M. Murphy.
After the shutdown, five charities that had used 4Run3 to operate fundraising races went to the bankruptcy court saying 4Run3 owes them nearly $30,000 in race registration fees and donations.
Subsequent bankruptcy filings revealed that 4Run3 owes more than $52,000 to 16 philanthropies. Those groups represent charities and causes ranging from outdoor education and animal welfare to the Junior League, Holyoke Pride and the Knights of Columbus.
Through 4Run3 Racing, the Murphys set up registration pages using a New Jersey technology company called runsignup. Runsignup collected race fees and donations and sent the money to accounts controlled by 4Run3 that were not accessible to the charities.
There are other creditors as well. Under bankruptcy rules, they all get a portion of the assets that can be recovered, according to how much they are owed.
If a creditor represents 10% of the debt, it stands to get 10% of the money available.
Included with the court filing are text messages from March and April of 2024 between Timothy Murphy and Brian Donoghue, one of the directors of the St. Patrick’s Parade Committee.
Donoghue, at first chatty in tone, becomes increasingly insistent in the messages that Murphy pay the committee the race proceeds. Runners were promised prizes and vendors, like the sound technician, were owed money.
Donoghue said he had 16 invoices from vendors and he needed the $176,000.
“I didn’t sleep a whole lot last night,” he wrote to Murphy.
“Feels like you stole this money. Feels like you lied to me many times about what was happening with Magic for Maddie and Give Them the Bird,” Donoghue texted Murphy, referring to other charity races 4Run3 handled.
“Both races I told them to use you. Something goes wrong they call me. Shoot me straight, is the race going to get this money? How are you getting a loan if you owe us $100k …? That doesn’t happen overnight. That’s a lot of money. Where did it go?”
Attorney Gary M. Weiner of Springfield represents the Murphys. He said they have left the area.
The running shop is closed. Its remaining goods were sold at auction and its landlord evicted the store.
Under oath
Timothy Murphy answered questions under oath last month at a meeting of creditors in the bankruptcy case.
Jonathan R. Goldsmith, representing the charities pro bono, asked Murphy about the couple’s RV, a large camper vehicle spotted at their home before they left the area.
Goldsmith had already asked if any assets were transferred from the companies back to the Murphys. He’d been told “no” by Timothy Murphy.
Goldsmith asked about the RV.
“Were any monies from 4Run3 Racing and/or Racing, Inc., any funds from either of those entities used as a down payment or the purchase of any RV that’s standing in your name and/or your wife’s name?” he asked, according to a transcript in the filing.
Weiner objected, but allowed Murphy to answer the question.
Murphy: “The answer’s no.”
