Bankruptcy judge rules against Teamsters

Interstate Bakeries Corp., the bankrupt maker of Wonder Bread and Twinkies snacks, on Wednesday received court approval to proceed with a plan to exit the bread market in Southern California. U.S. bankruptcy judge Jerry Venters approved the company's plan to shutter four bakeries, numerous retail outlets and 18 distribution centers in the region.

The International Brotherhood of Teamsters union opposed the move, and has cited the action as one sticking point in its negotiations with Interstate that are aimed at keeping the company afloat.

Interstate Bakeries controls about 12 percent of the Southern California market, but it has seen its share and profits erode in recent years. The bread division in Southern California lost more than $13 million in fiscal 2007, according to the company. "The profitability had deteriorated significantly," Interstate Bakeries President Michael Kafoure testified.

The company blamed stiff competition from Sara Lee and others for its slide. Interstate filed for bankruptcy in September 2004.


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