Tachion Networks may be dead, but its legend lives on in bankruptcy court. Lawyers and creditor representatives met this week in a New Jersey bankruptcy court to discuss the failed startup's assets, the first such meeting since Tachion filed for Chapter 7 bankruptcy protection in mid December.

The meeting's minutes were unavailable, but Tachion's latest bankruptcy filing did detail some of the smoldering remains of the startup that attracted some $86 million in funding and boasted a battle-tested board of directors that included CEO Jeff Matros, former Williams Communications (now WilTelCommunications Group Inc. [Nasdaq: WTEL]) board member Roy Wilkens, McLeodUSA Inc. (Nasdaq: MCLD) chairman Clark McLeod, and Mike Odrich, head of the private equity division of Lehman Brothers.

Tachion's Chapter 7 filing lists its number of creditors at between 16 and 49, its assets at between $100,000 and $500,000, and its debts at between $1 million and $10 million. Among its debts is a claim by Tachion's old landlord for $88,000 alleging damage to the premises.

The company was founded in 1996 and once employed more than 225 people. Its product was originally marketed to be a "collapse central office" switch that combined Frame Relay, IP, ATM, SS7 signaling, voice services, and an integrated Sonet add-drop multiplexer; but the startup ultimately produced more press clippings than actual products. After several setbacks, Tachion claimed to be shipping its product as an Internet offload device – a box that helps carriers move Internet data traffic away from their circuit-switch networks.

Remarkably, Tachion managed to garner product awards from some trade publications. It also publicly announced three carriers as customers. Some months later, however, it quietly acknowledged that it had never shipped equipment to the customers as announced, despite claiming that one of the contracts was worth $40 million (see Another Tack for Tachion).

Still more amazing was the financial support Tachion continued to win from top-notch investors, in the face of its failure to demonstrate traction with carrier customers. In December 2000, after its CEO told the press it was raising a $75 million round, Tachion announced a $50 million round from Lehman Brothers Venture Capital Group, Goldman Sachs & Co., J.P. Morgan Chase Bank & Co., J.P. Morgan Chase Bank & Co., Morgenthaler, Walden International Investment Group, and Singapore's EDB Investments.

By the summer of 2001, the startup had fired its employees and closed.

Entities owning five percent or more of Tachion include Morgenthaler and Walden International, each with 18.9 percent. Lehman owns 17 percent, followed by Goldman Sachs, which owns 6.1 percent, and J.P. Morgan, with a 5.5 percent stake.

As perhaps a fitting end to Tachion's saga, the bankruptcy filings list the value of Tachion's intellectual property as "unknown."

— Phil Harvey, Senior Editor, Light Reading