Three creditors in the Great Northern Paper Co. bankruptcy have petitioned the court to transfer the defunct paper mill’s Chapter 7 liquidation case from Delaware to Maine.

The creditors, among nearly 1,000 entities to which Great Northern parent company GNP Maine Holdings LLC owes more than $50 million, argued that most of the mill owner’s assets and parties involved in the bankruptcy are in Maine.

Great Northern filed for bankruptcy protection on Sept. 22 with the U.S. Bankruptcy Court for the District of Delaware, where the company is incorporated. Still, it would not be unusual for the case to be transferred closer to the company’s East Millinocket headquarters.

According to the motion filed by creditors Hartt Transportation Systems Inc., Lynch Logistics Inc. and Lynco Inc., several other parties, including the former workers’ union representatives and the Maine Office of the Attorney General, support the proposed change of venue.

Other major creditors and the towns of Millinocket and East Millinocket also support the change, according to the motion.

The three creditors also have asked the court to cancel a meeting of creditors scheduled for Oct. 15 in Delaware and set a new meeting date in Maine.

Hartt, Lynch and Lynco, all based in Bangor, have said in court documents that Great Northern owes them a total of more than $400,000. The three creditors sought to force Great Northern into bankruptcy on Sept. 23, not knowing that the company already had filed a voluntary petition just one day earlier.

The bankrupt company, which is managed by the New Hampshire-based private equity firm Cate Street Capital, shut down its East Millinocket mill in late January and laid off more than 200 workers a few weeks later, citing rising costs for energy and wood. The mill had produced newsprint and paper for the book publishing industry for more than 100 years.

The bankruptcy is a blow to the local community and the laid-off millworkers, who had been told for months that the mill’s shutdown was only temporary. As recently as two months ago, company officials said they were still working on a plan to resume operations.

A Chapter 7 bankruptcy filing usually precedes a liquidation, in which the debtor ceases operations, sells off its assets and distributes the proceeds among its creditors. It differs from a Chapter 11 filing, which indicates the debtor is seeking to reorganize in an attempt to continue doing business.

A skeleton crew had been employed in East Millinocket to work on plans to resume operations and keep the mill from falling into disrepair. A sister mill in Millinocket, which has been idle since 2008, is in the process of being demolished.

Great Northern Paper’s attorney did not immediately return a call for comment Monday.

J. Craig Anderson can be contacted at 207-791-6390 or:

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