LexisNexis® Legal Newsroom
Digital Domain Creditor Says Asset Sale Must Be 'Fair,' Wants Deadline Extended

WILMINGTON, Del. - A creditor of bankrupt Digital Domain Media Group Inc. (DDMG), the visual effects company that worked in the film "Titanic," on Sept. 12 filed a brief in the U.S. Bankruptcy Court for the District of Delaware objecting to DDMG's motion seeking to sell its assets (In Re: Digital Domain Media Group Inc., No. 12-12568, Chapter 11, D. Del. Bkcy.). Subscribers may view the brief available within the full article.

Visual Effects Company Known For 'Titanic' Files For Chapter 11 Bankruptcy

WILMINGTON, Del. - Digital Domain Media Group Inc., (DDMG) the visual effects company that won Academy Awards for its work on films such as "Titanic," filed for Chapter 11 bankruptcy on Sept. 11 in the U.S. Bankruptcy Court for the District of Delaware (In Re: Digital Domain Media Group Inc., No. 12-12568, Chapter 11, D. Del. Bkcy.). Subscribers may view the declaration available within the full article.

Blue Cross' Hidden Fees Constitute Self-Dealing, Federal Judge Rules

DETROIT - Blue Cross Blue Shield of Michigan engaged in self-dealing in violation of the Employee Retirement Income Security Act, 29 U.S.C.S. § 1001 et seq., by charging self-insured welfare plans and their sponsors an administrative fee and unilaterally determining the amount of the fee, a federal judge in Michigan ruled Sept. 7 in granting summary judgment against Blue Cross on prohibited transaction claims (Borroughs Corporation, et al, v. Blue Cross Blue Shield of Michigan, Nos. 11-12565, 11-12557, E.D. Mich.; 2012 U.S. Dist. LEXIS 127587).

Bankruptcy Judge Approves Ritz Liquidation After Failure To Secure Stalking Horse

WILMINGTON, Del. - The federal bankruptcy judge presiding over the Chapter 11 proceeding of Ritz Camera & Image LLC on Sept. 10 approved a liquidation sale for all of the company's assets (In Re: Ritz Camera & Image LLC, No. 12-11868, Chapter 11, D. Del. Bkcy.). Subscribers may view the order available within the full article.

Delaware High Court: No Excess Coverage For Defense Of Antitrust Suits

WILMINGTON, Del. - The Supreme Court of Delaware on Sept. 7 affirmed a lower court's ruling that an excess insurer has no duty to reimburse its insured for defense costs or indemnity claims related to the insured's defense of underlying antitrust lawsuits (Intel Corporation v. American Guarantee & Liability Insurance Co., et al.,  No. 692, 2011, Del. Sup.; 2012 Del. LEXIS 480).

6th Circuit: Shareholder Filed Breach Of Fiduciary Duty Derivative Suit Too Late

CINCINNATI - A Sixth Circuit U.S. Court of Appeals panel affirmed a lower court in an unpublished opinion on Sept. 7, holding that the statute of limitations for a shareholder to bring claims of breach of fiduciary duty had run (Cranston Reid, Derivatively on Behalf of First Horizon National Corporation v. Gerald Baker, et al.,  No. 11-5473, 6th Cir.; 2012 U.S. App. LEXIS 18987).

3rd Circuit: Bond Order Appeal 'Moot' In Tribune Chapter 11 Bankruptcy

PHILADELPHIA - A panel of the Third Circuit U.S. Court of Appeals on Sept. 10 dismissed as moot a creditor's motion seeking an emergency stay of a bond order in the Chapter 11 bankruptcy proceeding of Tribune Co. (In Re: Tribune Company, No. 12-3437, Chapter 11, 3rd Cir.). Subscribers may view the order available within the full article.

Panel Says Lack Of Prompt Notice Dooms Reinsured's Asbestos-Related Claims

PHILADELPHIA - A Third Circuit U.S. Court of Appeals panel reversed a lower court decision on Sept. 7 and held that a reinsurer has no duty to pay its reinsured's losses because the reinsured failed to give prompt notice of underlying asbestos personal injury claims (Pacific Employers Insurance Co. v. Global Reinsurance Corporation of America,  No. 11-3234 and 11-3262, 3rd Cir.).

IRS Objects To Chapter 11 Reorganization Plan Of Developer American West

LAS VEGAS - The Internal Revenue Service on Sept. 6 filed a brief in the U.S. Bankruptcy Court for the District of Nevada objecting to the Chapter 11 reorganization plan of bankrupt developer American West Development Inc. (In Re: American West Development Inc., No. 12-12349, Chapter 11, D. Nev. Bkcy.). Subscribers may view the brief available within the full article.

5th Circuit Upholds Denial Of Pharmacy Manager's Retaliatory Discharge Claim

NEW ORLEANS - A Rite Aid manager failed to show that his termination was the result of his subordinates' alleged refusal to work under a black manager, the Fifth Circuit U.S. Court of Appeals ruled Sept. 5 (Malcolm Armstrong v. K & B Louisiana Corporation, et al.,  No. 11-30744, 5th Cir.; 2012 U.S. App. LEXIS 18640).

Putative Class In Jefferson County, Ala., Seeks Damages For Chapter 9 Bankruptcy

BIRMINGHAM, Ala. - A group of residents and county officials in Jefferson County, Ala., on Sept. 6 filed a putative class action adversary proceeding against the county and financial institutions, seeking damages and injunctive relief for alleged improprieties related to interest rate swaps that the class argues resulted in the county's bankruptcy (Andrew Bennett, et al. v. Jefferson County, Alabama, et al. [In Re: Jefferson County, Alabama], No. 11-05736, Chapter 9, N.D. Ala. Bkcy.). Subscribers may view the complaint available within the full article.

2nd Circuit: Debtor's Case 'Meritless'; Creditor Has Valid Bankruptcy Claim

NEW YORK - A panel of the Second Circuit U.S. Court of Appeal on Sept. 6 affirmed a bankruptcy court's ruling and said that a debtor's argument that the claim filed by a company with which it had a tax agreement was "meritless" (CIT Group Inc. v. Tyco International Inc. [In Re:  CIT Group],  No. 12-1692, Chapter 11, 2nd Cir.; 2012 U.S. App. LEXIS 18696).

Federal Circuit Affirms Judgment, Damages In Patent Dispute

WASHINGTON, D.C. - A multipronged appeal by a patent infringement defendant was rejected in full Sept. 6 by the Federal Circuit U.S. Court of Appeals, which upheld a final judgment of infringement as well as a jury's award of $11 million in reasonable royalties and lost profit damages (K-TEC Inc. v. Vita-Mix Corporation, Nos. 11-1244, 1484, 1582, Fed. Cir.).

Bankruptcy Judge Approves Chapter 9 Plan For City Of Central Falls, R.I.

PROVIDENCE, R.I. - A federal bankruptcy judge in Rhode Island on Sept. 5 approved the fourth amended Chapter 9 bankruptcy plan for the City of Central Falls, R.I., which will protect $27 million in municipal bonds (In Re: The City of Central Falls, R.I., No. 11-13105, Chapter 9, D. R.I. Bkcy.). Subscribers may view the plan available within the full article.

Saab Creditors Call For Documents Regarding Ally Financial's $61M Claim

WILMINGTON, Del. - The Official Committee of Unsecured Creditors in the Chapter 11 bankruptcy of Saab Cars North America Inc. (SCNA) moved Sept. 5 in the U.S. Bankruptcy Court for the District of Delaware for an order directing the production of documents from Ally Financial Inc. pertaining to a $61 million claim the financial company made in Saab's bankruptcy proceeding (In Re: Saab Cars North America Inc., No. 12-10344, Chapter 11, D. Del. Bkcy.). Subscribers may view the motion available within the full article.

Bankrupt San Bernardino Emergency Budget Aims To Cut Deficit By $27.89M

SAN BERNARDINO, Calif. - The City Council for San Bernardino, Calif., on Sept. 5 approved an emergency budget that will reduce expenses by 30 percent and aims to reduce the city's $45 million deficit to slightly more than $16.42 million (In Re: City of San Bernardino, California, No. 12-28006, Chapter 9, C.D. Calif. Bkcy.). Subscribers may view the emergency budget  available within the full article.

Media Entity Journal Register Co. Files For Chapter 11 Bankruptcy Again

NEW YORK - The Journal Register Co. (JRC), a media company with entities in New York, Pennsylvania, Ohio and Michigan, on Sept. 5 filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the Southern District of New York, citing debt of $162.3 million. It is the second time JRC has filed for bankruptcy since 2009 (In Re: Journal Register Company, No. 12-13774, Chapter 11, S.D. N.Y. Bkcy.). Subscribers may view the petition available within the full article.

Judge Denies Motion To Vacate Entry Of Default Against Chinese Drywall Firm

MIAMI - A Florida judge on Aug. 31 declined to vacate the entry of default against a Chinese drywall manufacturer, finding that the foreign corporation is subject to U.S. court jurisdiction after ruling that the firm "failed to establish excusable neglect, due diligence and a meritorious defense" (Lennar Homes LLC, et al. v. Knauf GIPS KG, et al., No. 2009-7901-CA-01, Fla. Cir., Miami-Dade Co.).  View related prior history, 2010 Fla. App. LEXIS 7969.

Bankruptcy Judge: American Airlines May Reject Collective Bargaining Agreement

NEW YORK - The federal bankruptcy judge presiding over the Chapter 11 proceeding of AMR Corp., the parent company of American Airlines Inc., on Sept. 5 approved American's proposal to reject the collective bargaining agreement (CBA) it has with its pilots, after determining that its furlough and codesharing plan complied with federal bankruptcy law (In Re: AMR Corporation, No. 11-15463, Chapter 11, S.D. N.Y. Bkcy.). Subscribers may view the order available within the full article.

Judge: Loss Of Some Data Does Not Undermine Agency's Remediation Plan

GREEN BAY, Wis. - A federal judge in Wisconsin on Aug. 30 refused to award summary judgment to companies seeking to avoid dredging portions of the Lower Fox River to remediate polychlorinated biphenyl (PCB) contamination after finding that although some data underlying studies supporting the U.S. Environmental Protection Agency's decision to require the companies to perform such remediation was missing, it was not fatal to the agency's decision (United States of America, et al. v. NCR Corporation, et al.,  No. 10-C-910, E.D. Wis.; 2012 U.S. Dist. LEXIS 123461).

MF Global SIPA Trustee Says He Should Have Authority To Assign Certain Claims

NEW YORK - The trustee in the Securities Investor Protection Act (SIPA)15 U.S.C.S. § 78aaa litigation related to the Chapter 11 bankruptcy of MF Global Inc. (MFGI), a subsidiary of MF Global Holdings Ltd. (MFGH), on Sept. 3 filed a brief in the U.S. Bankruptcy Court for the Southern District of New York arguing that he should be given the authority to assign claims to customer representatives (In Re: MF Global Inc., No. 11-2790, Chapter 11, S.D. N.Y. Bkcy.).

U.S. Trustee: Patriot Coal Bankruptcy Filed In An Improper Venue

NEW YORK - The U.S. trustee in the Chapter 11 bankruptcy proceeding of Patriot Coal Corp. on Aug. 31 filed a brief in the U.S. Bankruptcy Court for the Southern District of New York contending that the current venue for bankruptcy is improper and should be changed (In Re: Patriot Coal Corporation, No. 12-12900, Chapter 11, S.D. N.Y. Bkcy.). Subscribers may view the brief available within the full article.

$20M In Interim Financing For CHL Could Increase To $35M Pending Approval

WILMINGTON, Del. - The federal bankruptcy judge presiding over the Chapter 11 case of CHL Ltd. on Aug. 31 approved $20 million in interim post-petition financing, which could increase to as much as $35 million pending final approval by the bankruptcy judge (In Re: CHL Ltd., No. 12-12437, Chapter 11, D. Del. Bkcy.). Subscribers may view the order available within the full article.

Landlord: Ritz Camera Should Not Be Permitted To Sell Assets Free Of Liens

WILMINGTON, Del. - The landlord of an individual retail store operated by bankrupt Ritz Camera & Image LLC on Aug. 31 filed a brief in the U.S. Bankruptcy Court for the District of Delaware, objecting to Ritz's motion seeking approval to sell its assets free and clear of liens and seeking to sell executory contracts and unexpired leases at auction (In Re: Ritz Camera & Image LLC, No. 12-11868, Chapter 11, D. Del. Bkcy.). Subscribers may view the brief available within the full article.

EEOC's Claims Have 300-Day Cutoff Date, Ohio Federal Judge Rules

CLEVELAND - An allegation by the U.S. government that an industrial forging company discriminates against women in its hiring practices cannot include any violations that may have happened more than 300 days before the government's 2008 discrimination charge, an Ohio federal judge held Aug. 30 (Equal Employment Opportunity Commission v. Presrite Corporation, No. 11-cv-260, N.D. Ohio; 2012 U.S. Dist. LEXIS 124083).