Gibraltar Pays $65 Million To Settle Rothstein Ponzi Claims

FORT LAUDERDALE, Fla. - (Mealey's) The trustee for a bankrupt feeder fund and the trustee of convicted Ponzi schemer Scott W. Rothstein's law firm have agreed to an amended $65 million settlement with Gibraltar Private Bank and Trust Co., a bank Rothstein is alleged to have used in his scam,...

Bankruptcy's Unique Characteristics Prompt Special Guidance From ABA Working Group

Earlier this year the ABA ESI in Bankruptcy Working Group issued interim guidelines on the "scope and timing" of a party's obligation to preserve ESI in bankruptcy cases. The group comprises both sitting and former judges, bankruptcy and litigation attorneys, law professors and a representative...

Separate Classification of Deficiency Claims in Chapter 11 Plans

James M. Lawniczak considers a Ninth Circuit appellate panel decision allowing separate classification of a lender's unsecured deficiency claim in a chapter 11 plan. The decision is part of the continuing conflict between single asset real estate debtors and secured creditors over plan confirmation...

Twinkie Maker Hostess Seeks Liquidation as Deal with Unions Breaks Down

NEW YORK - (Mealey's) Twinkie maker Hostess Brands Inc., which had been proceeding with a bankruptcy reorganization plan, moved in the U.S. Bankruptcy Court for the Southern District of New York on Nov. 16 for authorization to convert its proceeding to Chapter 7, which would result in liquidation...

Consumer Chapter 11: When Big Bankruptcies Get Personal

Whether it's " Mr. Las Vegas " or crazy actors , celebrities always seem to have financial troubles. That's part of what makes them so entertaining. Understandably, the large amounts of money they make (and owe) can sometimes push them into consumer bankruptcies of the Chapter 11...

Bip . . . Bip . . . Bip . . . "Pong" Creator Atari Files for Chapter 11

Atari, Inc., the creator of the primordial video game " Pong ", filed for Chapter 11 Jan. 21 in the U.S. Bankruptcy Court for the Southern District of New York. Its parent company, Atari SA, simultaneously sought bankruptcy protection in France. The moves were precipitated by a cessation...

Delaware Federal Judge Grants Debtor Access To Asbestos Claimant Information

WILMINGTON, Del. - (Mealey's) A Delaware federal judge on March 1 ruled that Chapter 11 debtor Garlock Sealing Technologies LLC can obtain documents filed by asbestos claimants' attorneys in nine other asbestos-related bankruptcy cases, finding that a bankruptcy judge erred and abused her discretion...

Fifth Circuit Issues Two Decisions Easing Path for Chapter 11 Debtors

Within the span of a few days, Judge Patrick Higginbotham of the Fifth Circuit released two decisions which will ease the way for chapter 11 debtors to confirm their plans. In the first decision, the Court definitively put a stake through the heart of the artificial impairment doctrine, while in ...

MF Global SIPA Trustee, JPMorgan Reach Settlement That Will Return $300 Million To Commodities Customers

NEW YORK - (Mealey's) 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...

DeX Games - SuperMedia and Dex One File Simultaneous Chapter 11 Cases to Effect Merger

Distressed M&A is the "new normal" in Chapter 11 cases, as noted here and elsewhere . Two large media marketing and advertising companies, SuperMedia and Dex One , took the "new normal" to new extremes last week by filing simultaneous and coordinated "prepackaged"...

"Girls Gone Wild" Chapter 11 Case - [Insert Joke Here]

GGW LLC and its affiliates ("GGW"), which produce and distribute the soft core pornography videos known as "Girls Gone Wild", recently filed for relief under chapter 11 of the Bankruptcy Code. The filing follows years of legal troubles for the company's founder, Joe Francis, including...

Bankruptcy Judge Sets Specialty Products’ Asbestos Liability At $1.16 Billion

WILMINGTON, Del. -- (Mealey's) Former joint compound producer Bondex International Inc. and its related holding company Specialty Products Holding Corp. face an estimated $1.16 billion in pending and future asbestos personal injury claims, about double what the companies estimate their asbestos...

Bankruptcy Judge Sets Specialty Products' Asbestos Liability At $1.16 Billion

WILMINGTON, Del. -- (Mealey's) Former joint compound producer Bondex International Inc. and its related holding company Specialty Products Holding Corp. face an estimated $1.16 billion in pending and future asbestos personal injury claims, about double what the companies estimate their asbestos liabilities...

DOJ Unveils New Fee Guidelines For Big Ch. 11 Cases

Law360, Chicago (June 11, 2013, 1:41 PM ET) -- The U.S. Department of Justice's bankruptcy watchdog arm on Tuesday released its long-awaited new framework for scrutinizing attorneys' fees in large Chapter 11 cases, hoping to boost transparency and keep bankruptcy lawyers from charging above...

Pfizer Faces Asbestos Actions after Supreme Court Declines to Hear Case

WASHINGTON, D.C. - (Mealey's) The U.S. Supreme Court on June 24 denied a bid for certiorari by Pfizer Inc. of a ruling removing the protection for Pfizer of a bankruptcy injunction barring asbestos personal injury claims entered in the case of a defunct Pfizer subsidiary ( Pfizer Inc. v. Law...

3rd Circuit Rejects Garlock’s Appeal Of Grace’s Plan For Lack Of Injury, Standing

PHILADELPHIA — (Mealey’s) Chapter 11 debtor Garlock Sealing Technologies Inc. does not have standing to object to fellow debtor W.R. Grace & Co.’s confirmed plan of reorganization because Garlock cannot show that it will be harmed by the plan, the Third Circuit U.S. Court of Appeals...

U.S. Government, 6 States Seek Injunction Blocking Merger of American, US Airways

WASHINGTON, D.C. — (Mealey’s) The U.S. Department of Justice on Aug. 13 filed a lawsuit against US Airways Group Inc. and AMR Corp., the parent company of American Airlines Inc., seeking a full injunction to prevent the proposed merger of the two airlines on grounds that it violates federal...

Auto-Hauler Allied Systems Holdings' Car Wreck of a Chapter 11 Case May Finally Be at an End

Many commentators have remarked that a “new normal” has evolved for Chapter 11 proceedings , wherein the major constituents negotiate the salient terms and exit strategy of the debtor’s restructuring prior to the filing of the bankruptcy petition, generally leading to shorter, less...

ABI Commission Considers Future of Chapter 11 (Austin Hearing Pt. 1)

The ABI Commission studying reform of Chapter 11 met for its seventeenth and final time at the UT Bankruptcy Conference in Austin, Texas on Friday November 22, 2013. The Commission heard from a total of eight witnesses on a variety of topics. Seven of the eight witnesses touched on the venue issue with...

Interesting ResCap FactOID – Court Rejects Effort to Disallow Portion of Bond Claims Based on “Original Issue Discount”

by Ben Feder In an opinion that will have a significant impact on the viability of debt for debt exchanges and out of court restructurings, Judge Martin Glenn of the U.S. Bankruptcy Court for the Southern District of New York has refused in the Chapter 11 case of Residential Capital LLC (“ ResCap...

Garlock Sues Law Firms, Alleging Fraud Over Asbestos Claims

CHARLOTTE, N.C. — (Mealey’s) Chapter 11 debtor Garlock Sealing Technologies LLC filed four adversary complaints Jan. 9 in a North Carolina federal bankruptcy court against several law firms and attorneys, alleging conspiracy, fraud and violations of the Racketeer Influenced and Corrupt Organizations...

Bankruptcy Judge: Plaintiffs, Lawyers Covered Up Evidence In Garlock Mesothelioma Cases

CHARLOTTE, N.C. —(Mealey’s) Chapter 11 debtor Garlock Sealing Technologies LLC’s total estimated liability for present and future mesothelioma claims is only $125 million, not $1.2 billion as asbestos personal injury claimants argued, because Garlock’s history of settling mesothelioma...

Bankruptcy Judge: Plaintiffs, Lawyers Covered Up Evidence in Garlock Meso Cases

CHARLOTTE, N.C. — (Mealey’s) Chapter 11 debtor Garlock Sealing Technologies LLC’s total estimated liability for present and future mesothelioma claims is only $125 million, not $1.2 billion as asbestos personal injury claimants argued, because Garlock’s history of settling mesothelioma...

Fisker Automotive Chapter 11 Case: a Two-Headed Stalking Horse and a New Credit Bidding Controversy

Fisker Automotive’s chapter 11 case began in what has become a depressingly familiar fashion – a fast-tracked sale to a secured lender. However, two rulings by Judge Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware have made this a fascinating case to follow. Judge Gross...

U.S. Supreme Court Will Not Hear Case on Transfers Made Under Bankruptcy Code

WASHINGTON, D.C. — (Mealey’s) The U.S. Supreme Court today declined to hear a case in which an unsecured creditors committee had argued that 11 U.S. Code Section 546(e) permits it to recover transfers made by a debtor company to stockbrokers, financial institutions and other “qualified”...