LexisNexis® Legal Newsroom
    MF Global SIPA Trustee, JPMorgan Reach Deal To Return $300M To Customers

    NEW YORK - The Securities Investor Protection Act (SIPA) trustee in the MF Global Inc. (MFGI) bankruptcy on March 19 announced that he had reached a settlement agreement with JP Morgan Chase Bank N.A. that will return $300 million to commodities customers who had money invested with MFGI (In Re: MF Global Inc., No. 11-2790, Chapter 11, S.D. N.Y. Bkcy.).

    Rothstein Trustee: Statement Pertaining To Liquidation Plan Should Be Approved

    FORT LAUDERDALE, Fla. - The Chapter 11 liquidating trustee in the bankruptcy case of former law firm Rothstein Rosenfeldt Adler on March 19 filed a brief in the U.S. Bankruptcy Court for the Southern District of Florida arguing that the Bankruptcy Court should approve his disclosure statement despite objections (In Re: Rothstein Rosenfeldt Adler, No. 09-34791, Chapter 11, S.D. Fla. Bkcy.).

    Federal Judge: Notice Of Appeal Not Timely Filed; Therefore, Leave Denied

    MINNEAPOLIS - A federal judge in Minnesota on March 18 denied a debtor leave to appeal a bankruptcy court's dismissal of his lawsuit against his former wife and her parents alleging willful violation of the automatic stay, ruling that his notice of appeal was not filed in a timely manner (Randy J. Krongard v. Laura L. Krongard Loban $(In Re: Randy J. Krongard$), No. 12-3129, Chapter 7, D. Minn.; 2013 U.S. Dist. LEXIS 36834).

    OSG Defends Awarding Up To $12.2M In Bonuses, Dismisses U.S. Trustee's Objection

    WILMINGTON, Del. - Bankrupt shipping company Overseas Shipholding Group Inc. (OSG) on March 18 defended its request for approval of up to $12.2 million in bonuses for non-executive employees despite objections of the U.S. trustee (In Re: Overseas Shipholding Group Inc., No. 12-20000, Chapter 11, D. Del. Bkcy.).

    U.S. Supreme Court Hears Arguments In Case Of Debtor's Alleged Defalcation

    WASHINGTON, D.C. - The U.S. Supreme Court on March 18 heard oral arguments in a case involving a bank's claim that a debtor who had acted as trustee for his father's insurance trust acted recklessly and was guilty of defalcation for making loans to himself during the time he had control of the trust (Randy Curtis Bullock v. BankChampaign, No. 11-1518, Chapter 7, U.S. Sup.).

    MF Global Seeks $70M In Exit Financing To Fund Liquidation Process

    NEW YORK - Bankrupt MF Global Holdings Ltd. (MFGH) on March 15 filed a supplement to its Chapter 11 plan of liquidation requesting $70 million in exit financing to complete the liquidation process (In Re: MF Global Holdings Ltd., No. 11-15059, Chapter 11, S.D. N.Y. Bkcy.).

    6th Circuit Rules Bankruptcy Fraud Conviction Stands; Evidence 'Overwhelming'

    CINCINNATI - A panel of the Sixth Circuit U.S. Court of Appeals on March 14 affirmed a district court's ruling that a debtor committed bankruptcy fraud, saying there was "overwhelming" evidence he made multiple false statements during the proceeding (Douglas Anthony Dale v. United States of America, No. 12-3206, Chapter 13, 6th Cir.; 2013 U.S. App. LEXIS 5266).

    Committee: Ormet's Bidding Procedures Unfairly Benefit Stalking Horse

    WILMINGTON, Del. - The Official Committee of Unsecured Creditors in the Chapter 11 bankruptcy of Ormet Corp. on March 15 filed an objection in the U.S. Bankruptcy Court for the District of Delaware contending that Ormet's bidding procedures unfairly favor the stalking horse (In Re: Ormet Corporation, No. 13-10334, Chapter 11, D. Del. Bkcy.).

    Federal Judge Affirms Ruling; Debtor Must Turn Over Property To Trustees

    ST. THOMAS, Virgin Islands - A federal judge in the Virgin Islands on March 14 ruled that a bankruptcy court had jurisdiction to order a debtor to turn over property to the trustees in his personal bankruptcy as well as in the corporate bankruptcy of the company he founded (In Re: Jeffrey J. Prosser, No. 06-30009, Chapter 7; In Re: Innovative Communications Corporation, No. 07-30012, Chapter 11; Stan Springel, et al. v. Jeffrey J. Prosser, et al, No. 2011-113, D. V.I., St. Thomas/St. John; 2013 U.S. Dist. LEXIS 35311).

    Hawker Beechcraft Trustee Says Some Of $19.31M In Fees Are 'Unreasonable'

    NEW YORK - The U.S. trustee in the Chapter 11 bankruptcy of Hawker Beechcraft Inc. on March 14 filed a brief in the U.S. Bankruptcy Court for the Southern District of New York objecting to various firms' applications for more than $19.31 million in compensation and reimbursement of expenses (In Re: Hawker Beechcraft, No. 12-11873, Chapter 11, S.D. N.Y. Bkcy.).

    Federal Judge: Debtor's Case Against Employer Barred By Judicial Estoppel

    WILMINGTON, Del. - A federal judge in Delaware on March 14 ruled that a debtor's lawsuit against his former employer was barred by judicial estoppel because he failed to indicate the lawsuit on his bankruptcy schedules (David J. Yetter v. Wise Power Systems Inc., No. 11-00040, Chapter 7, D. Del.).

    Michigan Governor Names Detroit's Emergency Financial Manager

    DETROIT - The Michigan Local Financial Emergency Assistance Board on March 14 approved Gov. Rick Snyder's appointment of bankruptcy attorney Kevyn Orr as the emergency financial manager for the City of Detroit.

    Dewey & LeBoeuf Cannot Disallow More Than $12.94M Claim, Former Partner Says

    NEW YORK - A creditor in the Chapter 11 bankruptcy proceeding for former law firm Dewey & LeBoeuf on March 14 filed a brief in the U.S. Bankruptcy Court for the Southern District of New York objecting to the firm's objection to the claims asserted by himself and other former partners in the firm (In Re: Dewey & LeBoeuf, No 12-12321, Chapter 11, S.D. N.Y. Bkcy.).

    Bankruptcy Judge Approves Plan Allowing For MF Global To Proceed With Liquidation

    NEW YORK - The bankruptcy judge presiding over the Chapter 11 proceeding of MF Global Holdings Ltd. on March 13 approved a plan put forth by the plan proponents that would make it possible for the liquidation to proceed (In Re: MF Global Holdings Ltd., No. 11-15059, Chapter 11, S.D. N.Y. Bkcy.).

    GM Says Revstone's Choice Of Restructuring Officer Is 'Unquestionably Conflicted'

    NEW YORK - General Motors LLC (GM) on March 13 filed a brief in the U.S. Bankruptcy Court for the Southern District of New York objecting to Revstone Industries LLC's application to employ Huron Consulting Services LLC as a financial adviser, on grounds it is not an independent fiduciary (In Re: Revstone Industries LLC, No. 12-13262, Chapter 11, S.D. N.Y. Bkcy.).

    Bankruptcy Judge OKs Tribune Liquidation Of Retiree Claims For More Than $12.12M

    WILMINGTON, Del. - The bankruptcy judge presiding over the Chapter 11 bankruptcy of Tribune Co. on March 12 issued an order permitting Tribune to liquidate 86 claims brought by retirees of the company by paying $12,120,472.90 (In Re: Tribune Company, No. 08-13141, Chapter 11, D. Del. Bkcy.).

    Hostess Unions Object To Asset Sale, Say Terms Violated, Jobs Not Preserved

    NEW YORK - Two unions filed a brief in the U.S. Bankruptcy Court for the Southern District of New York on March 12 objecting to the sale of certain assets by bankrupt Hostess Brands Inc. on grounds that the company violated its own terms in the sale and the purchasers have not agreed to preserve the jobs of union members (In Re: Hostess Brands Inc., No. 12-22052, Chapter 11, S.D. N.Y. Bkcy.).

    Equity Committee: Contract Cannot Be Rejected Under Bankruptcy Code

    WILMINGTON, Del. - The Official Committee of Equity Security Holders of bankrupt Tri-Valley Corp. (TVC) on March 12 filed a brief in the U.S. Bankruptcy Court for the District of Delaware contending that the Bankruptcy Court should rule that an agreement between TVC and another party is not an executory contract; therefore, it cannot be rejected pursuant to the Bankruptcy Code (In Re: Tri-Valley Corporation, No. 12-12291, Chapter 11, D. Del. Bkcy.).

    NECC Trustee Wants All Meningitis Outbreak MDL Cases Sent To Bankruptcy Court

    BOSTON - The trustee for the bankrupt New England Compounding Center (NECC) on March 10 asked a multidistrict litigation court overseeing federal meningitis outbreak injury cases to transfer all filed and unfiled, injury and noninjury, and party and nonparty claims to the bankruptcy court for equitable resolution (In Re: New England Compounding Pharmacy, Inc., Products Liability Litigation, MDL Docket No. 2419, No. 1:13-md-2419, D. Mass.).

    Wilmington Trust: ResCap Should Not Bear Costs Of Foreclosure

    NEW YORK - Wilmington Trust National Association, as the indenture trustee for bankrupt Residential Capital LLC (ResCap), on March 11 filed a brief supporting, but also objecting in a limited fashion, to ResCap's motion seeking a determination that the automatic stay prevents enforcement of a foreclosure review (In Re: Residential Capital LLC, No. 12-12020, Chapter 11, S.D. N.Y. Bkcy.).

    10th Circuit: Fraudulently Transferred Property Not Part Of Bankruptcy Estate

    DENVER - A panel of the 10th Circuit U.S. Court of Appeals on March 12 ruled that fraudulently transferred property is not part of the bankruptcy estate until it is recovered (Eric C. Rajala v. Robert H. Gardner, et al., No. 12-3113, Chapter 7, 10th Cir.; 2013 U.S. App. LEXIS 4941).

    6th Circuit: Student Loans Nondischargeable Despite Initial, Opposite Decision

    CINCINNATI - A panel of the Sixth Circuit U.S. Court of Appeals on March 12 ruled that a debtor's student loans were nondischargeable despite an earlier decision by a bankruptcy court discharging those obligations (Thomas J. Alfes v. Educational Credit Management Corporation $(In Re: Thomas J. Alfes$), No. 11-2159, Chapter 7, 6th Cir.; 2013 U.S. App. LEXIS 4864).

    Fisker Automotive: Liquidation Plan For A123 Systems Lacks Needed Information

    WILMINGTON, Del. - Fisker Automotive Inc. on March 11 filed a brief in a federal bankruptcy court objecting to the Chapter 11 liquidation plan of alternative energy company A123 Systems Inc., arguing that the disclosure statement A123 has filed fails to provide adequate information (In Re: A123 Systems Inc., No. 12-12859, Chapter 11, D. Del. Bkcy.).

    Howrey Trustee Says Payments To Ex-Partners, Firms Are Fraudulent Transfers

    SAN FRANCISCO - The trustee in the Chapter 11 bankruptcy of Howrey LLP on March 11 filed six adversary complaints in bankruptcy court, seeking recovery of what he alleges are fraudulent transfers made to former partners and their successor law firms (In Re: Howrey LLP, No. 11031376, Chapter 11, N.D. Calif. Bkcy.).

    Geokinetics, Supplier Of Data For Oil Companies, Files For Chapter 11 Bankruptcy

    WILMINGTON, Del. - Geokinetics Inc., which provides seismic data for companies in the oil and natural gas industry, filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the District of Delaware on March 10, citing more than $350 million in debts (In Re: Geokinetics Inc., No. 13-10472, Chapter 11, D. Del. Bkcy.).