Bankruptcy

  • January 30, 2015

    OCZ Trustee And Ex-Brass Spar Over Investigation

    Both sides of a dispute in Delaware bankruptcy court over the liquidation trustee for OCZ Technology Group Inc.'s estate’s investigation into whether there are claims for creditors stemming from settlements in California with the company’s former brass accused the other Friday of flouting judicial rules.

  • January 30, 2015

    Fla. Nursing Home Seeks To Nix US Appeal Of Ch. 11 Plan

    A Florida nursing home targeted for lapses in patient care said Thursday that U.S. health regulators' appeal of its Chapter 11 plan should be dismissed, saying the issues presented are moot since the plan has been confirmed and substantially consummated.

  • January 30, 2015

    Bankrupt Revstone Unit Stuck With $13M GM Claim

    A Delaware bankruptcy judge found a unit of auto parts manufacturer Revstone Industries LLC liable to General Motors LLC on Friday for breaching the terms of a financing package but declined to order the $13.3 million loan balance turned over.

  • January 30, 2015

    Deloitte Beats Some UK Misconduct Claims In MG Rover Row

    Deloitte LLP has won a partial appeal against the U.K. Financial Reporting Council over its alleged failure to properly manage conflicts of interest in advising MG Rover Group Ltd., which went bankrupt in 2005, and will now face only five of the original 13 misconduct rulings against it.

  • January 30, 2015

    Revel Creditors Make Peace With $125M Bankruptcy Loan

    Lawyers for the Revel Casino Hotel’s unsecured creditors announced a last-minute settlement Friday with bankruptcy lender Wells Fargo NA that hands them a better return in exchange for their support of a strenuously contested $125 million financing package.

  • January 30, 2015

    Ex-Furniture Brands Execs Duck Investor Fraud Suit

    A St. Louis federal judge has dismissed an investor class action claiming Ralph Scozzafava, the former CEO of Furniture Brands International Inc., and former CFO Vance Johnston defrauded investors by overstating 2012 sales before the company's plunge into bankruptcy the following year.

  • January 30, 2015

    Ex-Sentinel CEO Gets 14 Years For $665M Fraud

    Eric A. Bloom, the former Sentinel Management Group Inc. CEO convicted last year of running a colossal fraud that bankrupted the investment firm and bilked its customers out of $665 million, was sentenced to 14 years in prison Friday by an Illinois federal judge.

  • January 30, 2015

    TPG, Apax Shed Much Of $1.1B Hellas Clawback Suit

    A New York bankruptcy judge on Thursday trimmed a lawsuit alleging TPG Capital and Apax Partners LLP milked $1.1 billion from Hellas Telecommunications (Luxembourg) II SCA before its insolvency, limiting potential clawback liability to the firms’ U.S.-based investment funds.

  • January 30, 2015

    Phoenix Payment Gets Nod For Ch. 11 Disclosure Statement

    A Delaware bankruptcy judge blessed Phoenix Payment Systems Inc.'s disclosure statement on Friday, allowing the card transaction processor to solicit creditor votes for a Chapter 11 plan designed to dole out proceeds from the company's $50 million sale.

  • January 30, 2015

    Valeant Eyes $296M Prostate Drug In 1st Post-Allergan Play

    In its first major deal since Allergan Inc. thwarted its blockbuster takeover campaign last year, Valeant Pharmaceuticals International Inc. said late Thursday it has struck a tentative agreement to buy a prostate-cancer treatment and other assets from bankrupt Dendreon Corp. for $296 million.

  • January 29, 2015

    AgFeed Creditor Says $2.8M Claim Must Be Paid Now

    An AgFeed Industries Inc. creditor told a Delaware bankruptcy judge Wednesday that its $2.8 million claim against the hog producer's estate must be paid immediately, saying it shouldn't have to wait while the liquidating trustee pursues an adversary complaint against Hormel Food Corp.

  • January 29, 2015

    GE Capital Urges Consolidation Of Suits Over Petters' Scheme

    General Electric Capital Corp. on Thursday asked the U.S. Judicial Panel on Multidistrict Litigation to combine four lawsuits accusing the company of participating in the $3.6 billion Ponzi scheme orchestrated by Tom Petters.

  • January 29, 2015

    MSRB Says Bank Loan Secrecy Harms Bondholders

    The Municipal Securities Rulemaking Board on Thursday criticized the failure of many issuers in the $3.6 trillion municipal debt market to disclose their use of bank financing that can depress credit profiles and subordinate existing bondholders.

  • January 29, 2015

    Duane Morris Partner Suspended By Fla. Bankruptcy Judge

    The Florida judge overseeing a shopping mall property’s bankruptcy suspended a Miami-based Duane Morris LLP partner for 90 days Wednesday for allegedly orchestrating a plan to fool the court into signing an “agreed order” that the opposing counsel hadn’t seen in an attempt to revive a $49 million real estate row.

  • January 29, 2015

    Texas Bill Could Open EFH Unit’s Assets To Other Generators

    A Texas state lawmaker on Wednesday filed a new bill that could clear the way for power generators to buy a subsidiary of bankrupt Energy Future Holdings Corp., by lifting a 20 percent cap on how much power generators can own on Texas’ electrical grid.

  • January 29, 2015

    Exide Unveils Settlement That Could Speed Ch. 11 Exit

    Exide Technologies Inc. told a Delaware bankruptcy judge Thursday that senior secured and unsecured creditors in the case had come to a settlement over antitrust, intellectual property and pension concerns that appears to end months of wrangling and could hasten and simplify the battery giant's exit from Chapter 11.

  • January 29, 2015

    Wells Fargo, Revel Creditors Near Deal Over Ch. 11 Loan

    A judge on Thursday backed a settlement slashing the former Revel Casino's property tax assessment by $400 million, but held off ruling on a $125 million financing package from Wells Fargo NA as the bank nears a deal with unsecured creditors that would resolve their objections.

  • January 29, 2015

    Delia's Floats $2.5M Stalking Horse Deal For Trademarks

    Investors that bought the Alloy Apparel line from Delia’s Inc. in 2013 now want the liquidating retailer’s trademarks too, offering $2.5 million to pick up the intellectual property and possibly reunite the Delia’s and Alloy brands, according to court papers.

  • January 29, 2015

    ATP's $1M Settlement Denied In Gulf Oil Discharge Suit

    A Louisiana federal judge on Wednesday denied a proposed $1 million settlement over allegations a unit of bankrupt ATP Oil & Gas Corp. violated federal environmental laws by secretly discharging oil and chemicals into the Gulf of Mexico, questioning whether the penalty is too small.

  • January 29, 2015

    Wash. Developer Hit With $1M Atty Fee For ‘Abuse’ Of Process

    A Washington state court hit developer Prium Companies LLC Wednesday with a sanction of $1.1 million in attorneys’ fees and costs for what the judge called a “gross abuse of judicial process” in a dispute with its former real estate partner over ownership of a bankrupt Spokane office complex.

Expert Analysis

  • Tackling Energy Loan Defaults At A Time Of Cheap Oil

    Kraig Grahmann

    The sudden and steep drop in oil prices is likely to cause more exploration and production companies to default on debt agreements. While there are different options an E&P company and its lenders can use to address a credit agreement default, ultimately underlying circumstances — such as the severity of default and viability of the company and its assets — will play a key role in which approach is chosen, says Kraig Grahmann of Ha... (continued)

  • 'Wellness' Check For Bankruptcy — Confusion Reigns

    G. Ray Warner

    If the U.S. Supreme Court arguments on bankruptcy jurisdiction in Wellness International Network Ltd. v. Sharif are any indication, the upheaval created by the court’s decision in Stern v. Marshall is unlikely to be resolved soon, says G. Ray Warner, of counsel at Greenberg Traurig LLP and associate dean for bankruptcy studies at St. John’s University School of Law.

  • New Tool For Holdout Bondholders: The Trust Indenture Act

    Keith A. Simon

    By finding that Section 316(b) of the Trust Indenture Act protects a bondholder’s ability to sue in the practical sense, and not just the procedural right to sue, the Southern District of New York may have given minority bondholders significant leverage in future negotiations with distressed companies and secured lenders, say attorneys with Latham & Watkins LLP.

  • Key Questions When Selecting E-Discovery Vendors

    David Houlihan

    While e-discovery remains a critical pain point in litigation, the "solutions" supporting its processes continue to evolve. In order to help organizations navigate the sea of options, we conducted research with 21 organizations across e-discovery market segments to understand the factors involved in successful e-discovery investments, says David Houlihan of Blue Hill Research Inc.

  • 2nd Circ.'s Fairfield Decision Will Be Cited With Fervor

    Ingrid Bagby

    The Second Circuit’s opinion and subsequent denial of en banc review in the case of Fairfield Sentry Ltd. signals a paradigm shift in Chapter 15 jurisprudence. Parties seeking an independent review of a foreign order permitting a transfer or other actions affecting U.S. property may now have a powerful new basis on which to object in a U.S. court, say attorneys with Cadwalader Wickersham & Taft LLP.

  • Caesars’ Bankruptcy Plan Already Under Attack?

    Mark A. Salzberg

    The Southern District of New York’s opinion denying in large part two motions to dismiss filed by Caesars Entertainment Corp. in response to a lawsuit brought by noteholders is notable as being the first examination of Caesars’ pre-bankruptcy financial maneuvering and highlights some problems that could arise in the bankruptcy proceeding, says Mark Salzberg of Squire Patton Boggs LLP.

  • To Err Is Costly: Why 2nd Circ. Enforced Faulty UCC Filing

    Mitchell P. Portnoy

    The Second Circuit last week declined to save a secured creditor who, as part of the termination of a $300 million General Motors financing, mistakenly also permitted the filing of a UCC3 termination statement pertaining to $1.5 billion in unrelated secured debt. The Second Circuit’s decision is not surprising, given long-standing case law, nor would the doctrine of mutual mistake help the bank, say attorneys with Troutman Sanders LLP.

  • Understanding Valuation Of LIHTC Projects: Part 2

    Mark V. Bossi

    Courts have raised concerns about the valuation process for distressed low-income housing tax credit projects, and have illustrated the complications involved in valuing “midstream” noninvestment-grade tax credits. Where the value of the credits will be contested, an in-depth market survey is highly recommended, says Mark Bossi, co-chairman of Thompson Coburn LLP's financial restructuring practice.

  • A Data Security Checklist For Companies Hiring Law Firms

    Jenn Topper

    We trust our law firms with huge amounts of data, whether in or out of discovery, investigations or litigation. All too often, we have relied on privilege, confidentiality and attorney ethics as a proxy for data protection and information security. But in fact, law firms ought to be held to a much more stringent standard — and in-house counsel would be wise to begin with a number of specific inquiries, says legal industry consultan... (continued)

  • Understanding Valuation Of LIHTC Projects: Part 1

    Mark V. Bossi

    It is important to understand the value of a lender’s collateral, particularly in a workout or bankruptcy involving a low-income housing tax credit project, where the lender’s only recourse will be to the project itself. There are four unique aspects of an LIHTC project that impact valuation, says Mark Bossi, co-chairman of Thompson Coburn LLP's financial restructuring practice.