LexisNexis® Legal Newsroom
    Unsecured Creditors Committee Says WP Steel Parent Breached Duties, Seeks $238M

    WILMINGTON, Del. - The Official Committee of Unsecured Creditors in the Chapter 11 bankruptcy of WP Steel Venture LLC on Jan. 17 moved in the U.S. Bankruptcy Court for the District of Delaware for permission to sue Ira L. Rennert, the principal in charge of the Renco Group Inc., which is the parent company of WP Steel, alleging that he breached his fiduciary duties in the course of WP Steel's filing for bankruptcy. The committee says it can recover more than $238 million for the bankruptcy estate by suing Rennert (In Re: WP Steel Venture LLC, No. 12-11661, Chapter 11, D. Del. Bkcy.).

    Pittsburgh Corning Gets Approval For $52 Million Insulation Plant In China

    Pittsburgh Corning Gets Approval For $52 Million Insulation Plant In China

    Former MF Global Executives: Case Against Them Fails; No Evidence Of Fraud Shown

    NEW YORK - A group of former executives of bankrupt MF Global Holdings Inc. (MFGH) on Jan. 16 filed a brief in the U.S. District Court for the Southern District of New York arguing that the class action that was filed against them alleging violations of the Commodity Exchange Act (CEA) in connection with MFGH's bankruptcy should be dismissed (Joseph DeAngelis v. Jon S. Corzine, et al. $(In re: MF Global Holdings Limited Securities Litigation$), No. 11-7866, S.D. N.Y.).

    American Airlines Gets $1.5B In Additional Financing; Judge Denies Objections

    NEW YORK - The federal bankruptcy judge presiding over the Chapter 11 bankruptcy proceeding of AMR Corp., the parent company of American Airlines Inc., on Jan. 17 approved $1.5 billion in additional financing for the airline, overruling the objections of the indenture trustee (In Re: AMR Corporation, No. 11-15463, Chapter 11, S.D. N.Y. Bkcy.).

    Hostess Seeks Approval To Reject Contracts, Leases As Part Of Wind Down

    NEW YORK - Bankrupt Hostess Brands Inc. on Jan. 16 filed a brief in the U.S. Bankruptcy Court for the Southern District of New York, saying the Bankruptcy Court should approve the rejection of contacts and leases to facilitate the speedy wind down of the business (In Re: Hostess Brands Inc., No. 12-22052, Chapter 11, S.D. N.Y. Bkcy.).

    Bankruptcy Judge Approves Patent Sale In Elpida Chapter 15 Proceeding

    WILMINGTON, Del. - The federal bankruptcy judge presiding over the Chapter 15 bankruptcy of Elpida Memory Inc. on Jan. 16 approved a motion by foreign representatives of the company who sought the sale of various patents to Rambus Inc., a company that has reached a patent sale agreement with Elpida (In Re: Elpida Memory Inc., No. 12-10947, Chapter 15, D. Del. Bkcy.).

    Bankruptcy Judge Approves $52M In Additional Financing For Pinnacle Airlines

    NEW YORK - The federal bankruptcy judge presiding over the Chapter 11 bankruptcy of Pinnacle Airlines Corp. on Jan. 16 approved $52 million in additional post-petition financing, which was needed to avoid Pinnacle's proceeding from being converted to Chapter 7 liquidation (In Re: Pinnacle Airlines Corp., No. 12-11343, Chapter 11, S.D. N.Y. Bkcy.).

    10th Circuit Reverses; BAPCPA Did Not Repeal Absolute Priority Rule

    DENVER - A panel of the 10th Circuit U.S. Court of Appeals on Jan. 15 reversed and remanded a case, holding that the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) did not repeal the absolute priority rule (APR) and that a debtor couple's Chapter 11 plan of reorganization was confirmed in error (Dill Oil Company LLC v. Arvin E. Stephens, et al. $(In Re Arvin E. Stephens, et al.$), No. 11-6309, Chapter 11, 10th Cir.; 2013 U.S. App. LEXIS 1011).

    Former TWA Pilots: Bankruptcy Court Erred In AMR Proceeding; CBA Motion Was Valid

    NEW YORK - The former pilots with now-defunct TransWorld Airlines (TWA) on Jan. 15 filed a statement of issues on appeal in the Chapter 11 bankruptcy proceeding of AMR Corp., the parent company for American Airlines Inc., arguing that a federal bankruptcy court in New York erred in overruling their motion with respect to the collective bargaining agreement (CBA) between the pilots and the airline (In Re: AMR Corp., No. 11-15463, Chapter 11, S.D. N.Y. Bkcy.).

    Bankrupt OSG Seeks Stay Of Securities Class Actions Against Officers, Directors

    WILMINGTON, Del. - Bankrupt Overseas Shipholding Group Inc. (OSG) on Jan. 15 filed an adversary complaint in the U.S. Bankruptcy Court for the District of Delaware, seeking a declaration that the automatic stay applies to litigation against its current and former directors and officers (In Re: Overseas Shipholding Group Inc., No. 12-20000, Chapter 11, D. Del. Bkcy.).

    Kodak Says Kyocera Patent Infringement Case Should Be Stayed, Dismissed

    NEW YORK - Bankrupt Eastman Kodak Co. on Jan. 15 moved in the U.S. Bankruptcy Court for the Southern District of New York for an order enforcing an automatic stay and dismissing Kyocera Corp.'s adversary complaint alleging patent infringement claims (Kyocera Corporation v. Eastman Kodak Company $(In Re: Eastman Kodak Company, Adv. No. 13-01093, No. 12-10202, Chapter 11, S.D. N.Y. Bkcy.).

    Lack Of Bidders Forces Ritz Camera To Convert To Chapter 7 Bankruptcy

    WILMINGTON, Del. - The federal bankruptcy judge in Delaware who is presiding over the Chapter 11 bankruptcy of Ritz Camera & Image LLC on Jan. 15 ordered the proceeding to be converted to Chapter 7 liquidation because of Ritz's inability to find a buyer for all of its assets (In Re: Ritz Camera & Image LLC, No. 12-11868, Chapter 7, D. Del. Bkcy.).

    Hostess, Insurer Agree To Terms For Use Of Cash Collateral To Pay Deductible

    NEW YORK - Bankrupt Hostess Brands Inc. and ACE American Insurance Co. on Jan. 10 reached an agreement pertaining to a dispute concerning Hostess' use of cash collateral in the bankruptcy proceeding whereby the parties agree that ACE's obligation has been paid from the cash collateral since Nov. 12, but the parties each reserve their rights to assert a breach of the agreement in other regards (In Re: Hostess Brands Inc., No. 12-22052, Chapter 11, S.D. N.Y. Bkcy.).

    Former GSC Employees Join In U.S. Trustee's Brief Calling For Removal Of Trustee

    NEW YORK - A group of former employees of bankrupt GSC Group Inc. on Jan. 11 joined a brief filed by the U.S. trustee seeking to vacate an order approving the retention of Capstone Advisory Group LLC and requiring disgorgement of all fees and seeking the removal of the liquidating trustee (In Re: GSC Group Inc., No. 10-14653, Chapter 11, S.D. N.Y. Bkcy.).

    Hardware Company Gets $30M From Wells Fargo To Finance Chapter 11 Bankruptcy

    WILMINGTON, Del. - Texas-based Handy Hardware Wholesale Inc. (HHW) filed for Chapter 11 bankruptcy on Jan. 11 in the U.S. Bankruptcy Court for the District of Delaware, citing assets and debts between $50 million and $100 million (In Re: Handy Hardware Wholesale Inc., No. 13-10060, Chapter 11, D. Del. Bkcy.).

    Johnson Controls: Fee Related To A123 Systems Sale Is Being Wrongly Withheld

    WILMINGTON, Del. - Johnson Controls Inc. on Jan. 14 filed a brief in the U.S. Bankruptcy Court for the District of Delaware contending that in the Chapter 11 bankruptcy of alternative energy company A123 Systems Inc., the Official Committee of Unsecured Creditors (committee) wrongly seeks to hold in escrow the break-up fee related to the proposed sale of A123 Systems to Wangxiang Group Corp. Johnson Controls had hoped to purchase A123 Systems' assets (In Re: A123 Systems Inc., No. 12-12859, Chapter 11, D. Del. Bkcy.).

    8th Circuit Affirms Settlement Despite Debtor's Objection

    ST. LOUIS - A panel of the Eighth Circuit U.S. Court of Appeals on Jan. 11 ruled that a settlement negotiated by the Chapter 7 trustee between a debtor and a group of creditors stood because there was no abuse of discretion (Dennis E. Hecker v. Randall L. Seaver $(In Re: Dennis E. Hecker$), No. 11-3523, Chapter 7, 8th Cir.; 2013 U.S. App. LEXIS 742).

    In MF Global Liquidation Plan Filed By Creditors, All Claims Would Be Paid

    NEW YORK - The Committee of General Unsecured Creditors in the Chapter 11 bankruptcy of MF Global Holdings Ltd. (MFGH) on Jan. 10 proposed the first liquidation plan in the proceeding, calling for all claims against the company to be paid (In Re: MF Global Holdings Ltd., No.11-15059, Chapter 11, S.D. N.Y. Bkcy.).

    Hostess Proposes To Sell Most Of Its Bread Business For $360 Million

    NEW YORK - Bankrupt Hostess Brands Inc. on Jan. 11 moved in the U.S. Bankruptcy Court for the Southern District of New York for approval of a proposal to sell the majority of its bread business to Flowers Foods Inc. for $360 million (In Re: Hostess Brands Inc., No. 12-22052, Chapter 11, S.D. N.Y. Bkcy.).

    Federal Judge: Settlement Between Debtor, Insurance Carrier Proper

    CHICAGO - A federal judge in Illinois on Jan. 10 ruled that an insurance settlement between a debtor and one of its insurers related to asbestos coverage was proper despite a separate insurer's contention that the settlement would increase its own liability related to asbestos claims Columbia Casualty v. C.P. Hall Company $(In Re: C.P. Hall Co.$), No. 12-2978, Chapter 11, N.D. Ill.; 2013 U.S. Dist. LEXIS 3867).

    Harrisburg Council Cannot Sue Governor For Declaring Fiscal Emergency, Judge Says

    HARRISBURG, Pa. - A federal judge in Pennsylvania on Jan. 9 dismissed a lawsuit brought by members of the Harrisburg City Council against Pennsylvania Gov. Tom Corbett, ruling that the city council lacked standing to sue the governor under the due process clause of the 14th amendment to the U.S. Constitution for his decision to declare a fiscal emergency and seek the appointment of a receiver when the city was approaching bankruptcy (Wanda R.D. Williams, et al. v. Governor Thomas W. Corbett, No. 12-1211, M.D. Pa.).

    MSR Reorganization Plan Limits Government's Role, Should Be Denied, Attorney Says

    NEW YORK - The U.S. attorney for the Southern District of New York on Jan. 9 filed a brief in the U.S. Bankruptcy Court for the Southern District of New York arguing that the Chapter 11 reorganization plan of bankrupt MSR Resort Golf Course LLC should not be approved because it improperly limits the U.S. government's role as regulator in the proceeding (In Re: MSR Resort Golf Course LLC, No. 11-10372, Chapter 11, S.D. N.Y. Bkcy.).

    MF Global SIPA Agreement Would Make More Than $800 Million Available For Creditors

    NEW YORK - An attorney for the Securities Investor Protection Act (SIPA) trustee in the MF Global Inc. (MFGI) Chapter 11 bankruptcy on Jan. 10 filed a declaration supporting a settlement proposed between MFGI and its U.K. affiliates of MF Global that would return more than $500 million in customer property to the MFGI bankruptcy estate and make in excess of $300 million of funds available for distribution to customer claimants (In Re: MF Global Inc., No. 11-02790, Chapter 11, S.D. N.Y. Bkcy.).

    Nixon Peabody Must Disclose Rates To Be Hired In Kodak Case, U.S. Trustee Says

    NEW YORK - The U.S. trustee in the Chapter 11 bankruptcy case of Eastman Kodak Co. on Jan. 9 filed a brief in the U.S. Bankruptcy Court for the Southern District of New York, objecting to Kodak's application to retain Nixon Peabody LLC as special counsel on grounds that it fails to disclose its hourly rates and the terms of its employment by Kodak (In Re: Eastman Kodak Company, No. 12-10202, Chapter 11, S.D. N.Y. Bkcy.).

    Federal Judge Says Indenture Trustee Not Entitled To Claim In A&P Bankruptcy

    WHITE PLAINS, N.Y. - A federal judge in New York on Jan. 8 ruled that noteholders in the Chapter 11 bankruptcy of the Great Atlantic & Pacific Tea Co. Inc. (A&P) must vote in favor of the reorganization plan in order for the indenture trustee to file an allowed administrative claim for $1 million (Wilmington Trust Company v. The Great Atlantic & Pacific Tea Company Inc. $(In Re: The Great Atlantic & Pacific Tea Company Inc.$), No. 12-5969, S.D. N.Y.).