LexisNexis® Legal Newsroom
    Rothstein Trustee Argues Chapter 7 Conversion Lacks 'Legitimate' Basis

    FORT LAUDERDALE, Fla. - The Chapter 11 trustee in the bankruptcy of law firm Rothstein Rosenfeldt Adler (RRA) filed a brief on April 10 in the U.S. Bankruptcy Court for the Southern District of Florida objecting to a motion by various creditors who seek to have the bankruptcy converted to Chapter 7, saying there is "absolutely no legitimate or statutory basis to convert the case" (In Re: Rothstein Rosenfeldt Adler, No. 09-34791, Chapter 11, S.D. Fla. Bkcy.).

    Landlords Object To Bidding Procedures For Bankrupt Clothier Big M Inc.

    TRENTON, N.J. - A group of landlords on April 10 filed a brief in the U.S. Bankruptcy Court for the District of New Jersey objecting to bidding procedures proposed by bankrupt clothier Big M Inc., the parent company for Mandee and Annie Sez (In Re: Big M Inc., No. 13-10233, Chapter 11, D. N.J. Bkcy.).

    Reader's Digest Amends Plan, Restructures More Than $513.62M In Secured Debt

    NEW YORK - Bankrupt RDA Holding Co., the parent company of Reader's Digest, on April 11 filed an amended plan of reorganization that calls for the restructuring of more than $513.62 million in secured debt (In Re: RDA Holding Co., No. 13-22233, Chapter 11, S.D. N.Y. Bkcy.).

    7th Circuit Rules Destitute Debtor's Student Loan Obligations Discharged

    CHICAGO - A panel of the Seventh Circuit U.S. Court of Appeals on April 10 ruled that a debtor's student loan obligations were discharged because she is destitute, with no likelihood of changing her financial situation (Susan M. Krieger v. Educational Credit Management Corporation, No. 12-3592, Chapter 7, 7th Cir.; 2013 U.S. App. LEXIS 7202).

    Bankrupt Medical Device Maker Gets $30 Million In Post-Petition Funding

    WILMINGTON, Del. - The federal bankruptcy judge presiding over the Chapter 11 proceeding of Rotech Healthcare Inc. on April 9 issued an interim order approving $30 million in post-petition financing, also called debtor-in-possession (DIP) financing (In Re: Rotech Healthcare Inc., No. 13-10741, Chapter 11, D. Del. Bkcy.).

    ResCap: Plan To Pay $7.8M In Bonuses To Key Employees Complies With Code

    NEW YORK - Bankrupt financial group Residential Capital LLC (ResCap) on April 9 filed a brief in the U.S. Bankruptcy Court for the Southern District of New York defending its plan to pay $7.8 million in bonuses to key employees on grounds that it complies with the Bankruptcy Code (In Re: Residential Capital LLC, No. 12-12020, Chapter 11, S.D. N.Y. Bkcy.).

    Hostess Sells Remaining Bread Assets To Mountain States For $28.85 Million

    NEW YORK - The federal bankruptcy judge presiding over the Chapter 11 bankruptcy of Hostess Brands Inc. on April 9 approved the sale of the company's bread assets to Mountain States Bakeries LLC, which paid a deposit of $1.5 million in anticipation of the full purchase price of $28.85 million pursuant to the asset sale agreement (In Re: Hostess Brands Inc., No. 12-22052, Chapter 11, S.D. N.Y. Bkcy.).

    Clothier Big M, Parent Of Mandee, Annie Sez, Seeks OK For Asset Sale

    TRENTON, N.J. - Bankrupt Big M Inc., the parent company for women's clothing companies Mandee and Annie Sez, on April 6 moved for authorization to sell all of its assets free and clear of liens, as well as approval of its stalking horse agreement (In Re: Big M Inc., No. 13-10233, Chapter 11, D. N.J. Bkcy.).

    7th Circuit Reverses: Delay In Naming Trustee Did Not Extend Limitations Period

    CHICAGO - A panel of the Seventh Circuit U.S. Court of Appeals on April 8 reversed and remanded a bankruptcy case, ruling that the statute of limitations for filing avoidance claims was not extended as a result of a delay in appointing the Chapter 7 trustee (Richard M. Fogel v. Ronald Shabat $(In Re: Nachshon Draiman$), No, 12-3888, Chapter 7, 7th Cir.; 2013 U.S. App. LEXIS 7045).

    European Vodka Seller's Chapter 11 Would Resolve More Than $1.73B In Debt

    WILMINGTON, Del. - Liquor company Central European Distribution Co. (CEDC) on April 7 filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the District of Delaware using a prepackaged plan of reorganization that would resolve its more than $1.73 billion in debt (In Re: Central European Distribution Company, No. 13-10738, Chapter 11, D. Del. Bkcy.).

    AmBac Financial Seeks Approval Of $101.9M Settlement Payment To Resolve IRS Claims

    NEW YORK - Bankrupt AmBac Financial Group Inc. on April 8 moved in the U.S. Bankruptcy Court for the Southern District of New York for approval of a settlement with the Internal Revenue Service under which AmBac will pay $101.9 million to the U.S. government (In Re: AmBac Financial Group Inc., No. 10-15973, Chapter 11, S.D. N.Y. Bkcy.).

    Judge Says Ethical Wall Allows Silver Point To Trade MF Global Securities

    NEW YORK - The federal bankruptcy judge presiding over the Chapter 11 bankruptcy of MF Global Holdings Ltd. (MFGH) on April 8 approved the motion of Silver Point Capital for an order permitting securities trading upon the establishment of an ethical wall (In Re: MF Global Holdings Ltd., No. 11-15059, Chapter 11, S.D. N.Y. Bkcy.).

    Bankrupt Milwaukee Archdiocese To Publish Documents Related To Sexual Abuse Claims

    MILWAUKEE - The bankrupt Archdiocese of Milwaukee, the Official Committee of Unsecured Creditors and certain claimants who have alleged sexual abuse on April 3 filed a stipulation under which the archdiocese will produce and publish on its website certain documents pertaining to the sexual abuse claims against priests in the archdiocese (In Re: Archdiocese of Milwaukee, No. 11-20059, Chapter 11, E.D. Wis. Bkcy.).

    5th Circuit: Bankruptcy Court Erred; Creditor's Liens Not Valid And Enforceable

    NEW ORLEANS - A panel of the Fifth Circuit of the U.S. Court of Appeals on April 5 ruled that a bankruptcy court erred when it found that creditors in a bankruptcy proceeding had valid mechanic's liens against the debtor (First National Bank v. Crescent Electric Supply Company $(In the Matter of: Renaissance Hospital Grand Prairie Inc.$), No. 12-10386, Chapter 11, 5th Cir.; 2013 U.S. App. LEXIS 6945).

    Bankruptcy Judge Approves MF Global Liquidation Plan

    NEW YORK - The federal bankruptcy judge presiding over the Chapter 11 bankruptcy of MF Global Holdings Ltd. (MFGH) on April 5 approved the joint plan of liquidation (In Re: MF Global Holdings Ltd., No. 11-15059, Chapter 11, S.D. N.Y. Bkcy.).

    U.S. Trustee: ResCap Fails To Provide Details On $7.8M In Bonus Payments

    NEW YORK - The U.S. trustee in the Chapter 11 bankruptcy of Residential Capital (ResCap) LLC on April 3 filed a brief in the U.S. Bankruptcy Court for the Southern District of New York objecting to ResCap's plan to pay $7.8 million in bonuses to various employees because ResCap's plan fails to provide crucial information about the details of how bonuses will be paid (In Re: Residential Capital LLC, No. 12-12020, Chapter 11, S.D. N.Y. Bkcy.).

    MF Global Chapter 11 Trustee: Corzine's 'Negligent Conduct' Contributed To Demise

    NEW YORK - Louis J. Freeh, the Chapter 11 trustee in the bankruptcy of MF Global Holdings Ltd. (MFGH), on April 4 issued a report following his investigation of the collapse of MFGH in which he concludes that former CEO Jon Corzine engaged in "negligent conduct" that contributed to the company's collapse (In Re: MF Global Holdings Ltd., No. 11-15059, Chapter 11, S.D. N.Y. Bkcy.).

    2nd Circuit Authorizes Appeal Of $1.5B Post-Petition Financing In AMR Bankruptcy

    NEW YORK - The Second Circuit U.S. Court of Appeals on April 2 authorized the appeal of U.S. Bank Trust National Association Inc., which contends that a New York federal bankruptcy court erred when it ruled that repayment of financing notes in the Chapter 11 bankruptcy of AMR Corp., the parent company of American Airlines Inc., does not require the payment of a make-whole amount (American Airlines Inc., et al. v. U.S. Bank Trust National Association, No. 13-716, Chapter 11, 2nd Cir.).

    6th Circuit Partially Remands Fraud Case To Calculate Key Witness's Sentence

    CINCINNATI - A panel of the Sixth Circuit U.S. Court of Appeals on April 2 partially affirmed and partially remanded the ruling in a consolidated bankruptcy fraud case, ruling that the sentence handed down to one of the debtors who operated a business scheme needed to be reviewed given his cooperation as the key witness against his business partner (United States of America v. Bernard J. Kurlemann, et al., No. 11-3394, Chapter 11, 6th Cir.; 2013 U.S. App. LEXIS 6539).

    U.S. Trustee Argues Rothstein Liquidation Plan Gives Too Much To TD Bank

    FORT LAUDERDALE, Fla. - The U.S. trustee in the Chapter 11 bankruptcy of law firm Rothstein Rosenfeldt Adler (RRA) on April 1 filed a brief in the U.S. Bankruptcy Court for the Southern District of Florida objecting to the proposed plan filed by the Chapter 11 liquidation, trustee contending that it gives TD Bank a greater claim against the bankruptcy estate than it should be given (In Re: Rothstein Rosenfeldt Adler, No. 09-34791, Chapter 11, S.D. Fla. Bkcy.).

    Md. Bankruptcy Judge Declines To Reconsider Lifting Stay To Settle Asbestos Claims

    BALTIMORE - A Maryland federal bankruptcy judge on March 29 denied a request to reconsider her decision to lift the automatic stay in Lloyd E. Mitchell Inc.'s (LEM) Chapter 11 case so a confidential settlement among the debtor, two insurers and a law firm representing 9,000 asbestos personal injury claimants can be implemented, finding that an opposing law firm failed to show that lifting the stay is clear error or an injustice (In re: Lloyd E. Mitchell Inc., No. 06-13250, D. Md. Bkcy.).

    Bankruptcy Judge Approves Deal Between Nortel, Retired Employees

    WILMINGTON, Del. - A federal bankruptcy judge in Delaware on April 2 approved bankrupt Nortel Networks Inc.'s deal with the committee representing retired employees that will terminate retiree welfare plans and would pay the Official Committee of Retired Employees (Retiree Committee) $66,879,000 to resolve all claims against Nortel related to retirement benefits (In Re: Nortel Networks Inc., No. 09-10138, Chapter 11, D. Del. Bkcy.).

    MF Global Committee: Plan Of Liquidation Meets Code, Should Be Approved

    NEW YORK - The Statutory Creditors' Committee of MF Global Holdings Ltd. (MFGH) on April 2 filed a brief supporting confirmation of the joint plan of liquidation in MFGH's Chapter 11 bankruptcy, contending that the plan should be confirmed because it will increase distributions to creditors (In Re: MF Global Holdings Ltd., No. 11-15059, Chapter 11, S.D. N.Y. Bkcy.).

    7th Circuit: Discretion Not Abused; Debtors Cannot Avoid Property Lien

    CHICAGO - A panel of the Seventh Circuit U.S. Court of Appeals on March 29 ruled that a debtor couple could not avoid a lien on their condominium and held that the bankruptcy and district courts had not abused their discretion (Bryan D. Hinnen, et al. v. Emerald Hills Condominium Association, No. 12-2922, Chapter 13, 7th Cir.; 2013 U.S. App. LEXIS 6304).

    'Girls Gone Wild' Video Maker: Trustee Not Needed; Creditor Misrepresents Facts

    LOS ANGELES - Bankrupt adult entertainment company GGW Brands Inc., the parent company for the maker of "Girls Gone Wild" videos, on March 29 filed a brief contending that a creditor's motion seeking appointment of a trustee should not be granted because the creditor's allegations "distort or misrepresent the facts of the case" (In Re: GGW Brands Inc., No. 13-15130, Chapter 11, C.D. Calif. Bkcy.).