Barneys in New York, 2012.

The portion of Barneys New York that’s still working its way through bankruptcy is sifting through claims made by vendors, employees and other creditors, including administrative claims for goods and services provided during the company’s bankruptcy proceedings. In theory, those claims could be entitled to repayment.

But the estate has objected to a number of those types of claims, including certain claims for severance and payments for unused benefits made by employees who lost jobs as the Barneys stores closed. In a filing on Monday, the company argued those claims should not be prioritized as administrative expenses unless they were earned after Barneys filed for Chapter 11 protection in August.

“Accordingly, claims for severance, vacation pay and other benefits incident to termination are improperly classified claims to the extent such claims include amounts not attributable to the debtors’ post-petition operations,” the Barneys estate said in the filing.

It also said it would not cover unredeemed gift cards, or unreturned or damaged goods.

Attorneys for Barneys and an attorney for a union that has represented Barneys employees did not comment on Wednesday.

This week, the Barneys estate objected to a number of claims and reached some tentative agreements on others as it geared up for a hearing on administrative expense motions scheduled for Tuesday in bankruptcy court in Poughkeepsie, N.Y.

Administrative claims are generally prioritized for repayment in bankruptcy proceedings, as they are viewed as payments for goods and services that a company depended on to keep running its operations during its bankruptcy proceedings.

Barneys acknowledged as much in its filings, indicating that such administrative expenses include employee wages and payments for services provided during the bankruptcy that helped it stay open then. But it argued also that only some of those types of claims are entitled to priority repayment.

“Not all of a debtor’s post-petition expenses or obligations warrant administrative priority; rather, administrative priority applies only to a select subset of a debtor’s overall expenses, and such expenses must be both ‘actual’ and ‘necessary,’” Barneys said in a filing this week.

Unlike claims for payments that a company owes from before its bankruptcy filing, which are considered unsecured claims likely to be repaid at a deep discount, administrative claims are generally entitled to repayment.

But how that actually plays out in practice depends on the bankrupt estate’s finances.

In a monthly operating report filed in court, Barneys indicated it incurred a net loss of $92.7 million during the month that ended Jan. 4, and that it had roughly $10 million cash on its balance sheet. It said it planned to put $5.5 million of that cash toward its winding down expenses as the bankruptcy closes.

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