LexisNexis® Legal Newsroom
    Bankrupt Revel Casino Secures $250 Million In Post-Petition Financing

    TRENTON, N.J. - The federal bankruptcy judge overseeing the Chapter 11 proceeding of casino Revel AC Inc. on March 27 approved $250 million in post-petition financing, also known as debtor-in-possession (DIP) financing (In Re: Revel AC Inc., No. 13-16253, Chapter 11, D. N.J. Bkcy.).

    A&P Wants Claims Disallowed As Duplicative, Inconsistent With Reorganized Company

    NEW YORK - Bankrupt grocer The Great Atlantic & Pacific Tea Co. Inc. (A&P) on March 27 filed a brief in the U.S. Bankruptcy Court for the Southern District of New York objecting to certain proofs of claim and contending that they should be disallowed (In Re: The Great Atlantic & Pacific Tea Company Inc., No. 10-24549, Chapter 11, S.D. N.Y. Bkcy.).

    Peregrine Trustee Seeks To Compel Financial Adviser To Produce Documents

    CHICAGO - The trustee in the Chapter 7 bankruptcy of Peregrine Financial Group Inc. on March 25 moved in the U.S. Bankruptcy Court for the Northern District of Illinois to compel Halyard Capital Advisors LLC to produce documents pursuant to a subpoena related to the embezzlement of funds from Peregrine (In Re: Peregrine Financial Group Inc., No. 12-27488, Chapter 7, N.D. Ill. Bkcy.).

    San Bernardino Sues State Of California, Alleges Violation Of Automatic Stay

    RIVERSIDE, Calif. - The bankrupt city of San Bernardino, Calif., on March 26 sued the State of California, contending that the state is violating the automatic stay by demanding payment from the city for services. The city also argues that the state cannot withhold revenue it owes the city from sales tax collected from various agencies (In Re: City of San Bernardino, Calif., No. 12-28006, Chapter 9, C.D. Calif. Bkcy.).

    Magistrate Refuses To Sanction Bankrupt Company For Production Failures

    DANVILLE, Va. - A federal magistrate judge in Virginia has denied one tobacco company's attempt to collect more than $78,000 in attorney fees as a sanction from a bankrupt tobacco company for production failures, saying March 26 that the defendant's behavior did not warrant sanctions and that the plaintiff had failed to execute a writ of execution (Virginia Brands LLC v. Kingston Tobacco Company Inc., No.: 4:10-cv-9, W.D. Va., Danville Div.; 2013 U.S. Dist. LEXIS 42417).

    9th Circuit: Debtors' Plan Not Proposed In Bad Faith

    SAN FRANCISCO - A panel of the Ninth Circuit U.S. Court of Appeals on March 25 ruled that a debtor couple did not act in bad faith when it proposed their Chapter 13 payment plan despite the fact that they did not commit the entirety of their income to paying their creditors (Robert G. Drummond v. David C. Welsh, et al. $(In Re: David C. Welsh, et al.$), No. 12-60009, Chapter 13, 9th Cir.; 2013 U.S. App. LEXIS 5880).

    Judge Rules Against FDIC, Allowing Bank Company To Keep Tax Refund

    CLEVELAND - Bankrupt holding company AmFin Financial Corp. (AFC) can keep a $195 million tax refund that the Federal Deposit Insurance Corp. argued belongs to an affiliate bank in the FDIC's receivership, a federal judge in Ohio ruled March 26, granting AFC's motion for judgment on the pleadings (Federal Deposit Insurance Corp. v. AmFin Financial Corporation, et al., No. 11-2574, N.D. Ohio; 2013 U.S. Dist. LEXIS 42488).

    7th Circuit: Company That Bought Debtor's Assets Liable For Labor Violations

    CHICAGO - A panel of the Seventh Circuit U.S. Court of Appeals on March 26 ruled that a company that purchased the assets of an insolvent company also became liable for alleged violations of federal labor law that had been asserted by one of the company's employees (Brian Teed v. Thomas & Betts Power Solutions, No. 12-2440, Chapter 7, 7th Cir.).

    Bankrupt Telecommunications Company Otelco Seeks Prepackaged Reorganization

    WILMINGTON, Del. - Wireless communications company Otelco Inc. on March 24 filed a disclosure statement in the U.S. Bankruptcy Court for the District of Delaware, seeking acceptance of a prepackaged reorganization plan on the same day it filed for Chapter 11 bankruptcy (In Re: Otelco Inc., No. 13-10593, Chapter 11, D. Del. Bkcy.).

    U.S. Trustee Opposes AMR, US Airways Merger; CEO's Bonus Violates Bankruptcy Law

    NEW YORK - The U.S. trustee in the Chapter 11 bankruptcy of AMR Corp., the parent company of American Airlines Inc., on March 25 filed a sur-reply brief in the U.S. Bankruptcy Court for the Southern District of New York objecting to the proposed $11 billion merger of AMR and US Airways Group Inc. (In Re: AMR Corporation, No. 11-15463, Chapter 11, S.D. N.Y. Bkcy.).

    Judge: Recoupment Of Medicare Payments Does Not Violate Bankruptcy Discharge

    AIKEN, S.C. - A South Carolina federal judge on March 22 affirmed a ruling by a bankruptcy judge that the withholding of post-petition Medicare reimbursement claims to recoup pre-petition Medicare reimbursement overpayments does not violate the Chapter 7 discharge injunction (In re: Gary T. Fischbach, Debtor, v. Centers for Medicare and Medicaid Services, et al., No. 12-513, D. S.C.; 2013 U.S. Dist. LEXIS 39855).

    U.S. Trustee: MF Global Liquidation Plan Fails To Meet Bankruptcy Code

    NEW YORK - The U.S. trustee in the Chapter 11 bankruptcy of MF Global Holdings Ltd. (MFGH) on March 25 filed a brief in the U.S. Bankruptcy Court for the Southern District of New York objecting to the confirmation of MFGH's joint plan of liquidation on grounds it fails to satisfy the Bankruptcy Code (In Re: MF Global Holdings Ltd., No. 11-15059, Chapter 11, S.D. N.Y. Bkcy.).

    Revel AC Casino Files For Chapter 11 Bankruptcy, With $250M In Financing Lined Up

    TRENTON, N.J. - Bankrupt casino Revel AC Inc. on March 26 filed a disclosure statement for its joint plan of reorganization a day after it filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the District of New Jersey in which it says it has lined up $250 million in post-petition financing, also called debtor-in-possession (DIP) financing (In Re: Revel AC Inc., No. 13-16253, Chapter 11, D. N.J. Bkcy.).

    Ex-Partner: Dewey &LeBoeuf Not Allowed To Reclassify, Subordinate His Claim

    NEW YORK - A former partner of bankrupt law firm Dewey &LeBoeuf on March 25 filed a brief arguing that the firm's objection to his claims against the bankruptcy estate should not be granted because the firm seeks to improperly reclassify them as either equity interests or subordinated claims (In Re: Dewey &LeBoeuf, No. 12-12321, Chapter 11, S.D. N.Y. Bkcy.).

    Creditor: Trustee Needed In Bankruptcy Of 'Girls Gone Wild' Video Producer

    LOS ANGELES - A creditor of bankrupt adult entertainment company GGW Brands Inc., the parent company for the maker of "Girls Gone Wild" videos, on March 21 filed a motion in the U.S. Bankruptcy Court for the Central District of California arguing that a Chapter 11 trustee should be appointed (In Re: GGW Brands Inc., No. 13-15130, Chapter 11, C.D. Calif. Bkcy.).

    Shutterfly: Kodak Is Violating Noncompete Agreement Related To Asset Sale

    NEW YORK - Photography company Shutterfly Inc. on March 22 filed an adversary complaint against bankrupt Eastman Kodak Co. in the U.S. Bankruptcy Court for the Southern District of New York, seeking damages and injunctive relief for alleged violations of a noncompete covenant that was part of an agreement Kodak made when it sold an asset to Shutterfly (Shutterfly Inc. v. Kodak Imaging Network Inc, et al. $(Eastman Kodak Company$), No. 12-10202, Chapter 11, S.D. N.Y. Bkcy.).

    2 Creditor Groups Support AMR, US Airways Merger

    NEW YORK - Two committees in the Chapter 11 bankruptcy of AMR Corp., the parent company of American Airlines Inc., on March 22 filed statements in the U.S. Bankruptcy Court for the Southern District of New York approving the merger of American Airlines and US Airways Group Inc. (In Re: AMR Corporation, No. 11-15463, Chapter 11, S.D. N.Y. Bkcy.).

    Reader's Digest Reorganization Plan Would Convert $475M In Debt To Equity

    NEW YORK - Bankrupt publishing company RDA Holding Co., the parent company for Reader's Digest, on March 21 moved in the U.S. Bankruptcy Court for the Southern District of New York for approval of its plan of reorganization (In Re: RDA Holding Co., No. 13-22233, Chapter 11, S.D. N.Y. Bkcy.).

    Peregrine Trustee Wants To Examine Former Accountant Regarding CEO's Fraud

    CHICAGO - The trustee in the Chapter 7 bankruptcy of former financial company Peregrine Financial Group Inc. on March 19 moved in the U.S. Bankruptcy Court for the Northern District of Illinois for authorization to examine Peregrine's former accountant and other entities with which the accountant is affiliated (In Re: Peregrine Financial Group Inc., No. 12-27488, Chapter 7, N.D. Ill. Bkcy.).

    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.).