LexisNexis® Legal Newsroom
Bankruptcy Judge Rejects Barclays' Fee Enhancement For Work On ASARCO Case

CORPUS CHRISTI, Texas - Barclays Capital Inc. was adequately compensated for the 14 months of financial advisory services it provided in ASARCO LLC's bankruptcy case and is not entitled to a fee enhancement because Barclays should have anticipated the complicated developments in the case when it was hired, a Texas federal bankruptcy judge held May 30 in taking away a previously approved $975,000 fee enhancement award on remand (In re: ASARCO LLC, et al., No. 05-21207, S.D. Texas Bkcy.).

'Girls Gone Wild' Founder: Appeal Must Not Be Heard By Bankruptcy Appellate Panel

LOS ANGELES - Joseph Francis, the founder of bankrupt GGW Brands LLC, the parent company of the maker of adult videos carrying the name "Girls Gone Wild," on June 3 filed a statement that the appeal of the order that authorized the trustee to file a voluntary Chapter 11 petition for GGW Marketing LLC should be heard in the district court because he does not consent to the jurisdiction of the U.S. Bankruptcy Appellate Panel (BAP) for the Central District of California (In Re: GGW Brands LLC, No. 13-15130, Chapter 11, C.D. Calif. Bkcy.).

MF Global, Bank Of America Agree That $4M Claim Is Allowed

NEW YORK - Bankrupt MF Global Holdings Ltd.(MFGH) and Bank of America on May 31 stipulated to an agreement in a federal bankruptcy court in New York in which the bank will be allowed to make an unsecured claim for $4 million against MFGH (In Re: MF Global Holdings Ltd., No. 11-15059, Chapter 11, S.D. N.Y. Bkcy.).

2nd Circuit: Allegations Of Fraudulent Conveyance Belong To Bankruptcy Trustee

NEW YORK - The Second Circuit U.S. Court of Appeals on June 3 affirmed a district court's ruling determining that allegations of fraudulent conveyances by directors of a bankrupt company were the property of the bankruptcy trustee, not individual investors in the debtor company (D. Kent Sissel, et al. v. Maxine Eimicke, et al., No.12-952, Chapter 11, 2nd Cir.; 2013 U.S. App. LEXIS 11059).

6th Circuit Reinstates Female Job Applicant's Disparate Treatment Claim

CINCINNATI - The Sixth Circuit U.S. Court of Appeals on May 30 reinstated a female job applicant's disparate treatment claim related to the denial of a job in 2003 but affirmed denial of class certification and the remaining claims (Tanesha Davis v. Cintas Corporation, No. 10-1662, 6th Cir.; 2013 U.S. App. LEXIS 10856).

Creditor: ATP Owes More Than $87.62M; Asset Sale Motion Should Be Denied

HOUSTON - Creditor Statoil USA E&P on May 31 filed a brief objecting to a motion by bankrupt ATP Oil & Gas Corp. (ATP) that seeks approval of bidding procedures in its Chapter 11 proceeding, arguing that ATP has failed to post supplemental bond for more than $87.62 million related to deep-water drilling assets ATP is attempting to sell (In Re: ATP Oil & Gas Corporation, No. 12-36287, Chapter 11, S.D. Texas Bkcy.).

Lender Says It Has Standing To Oppose Rothstein Trustee's Deal On Versace Mansion

FORT LAUDERDALE, Fla. - The lender that holds a $25 million first mortgage on the former mansion of designer Gianni Versace on May 30 filed a brief arguing that it has standing to object to the agreement entered into by the trustee in the Chapter 11 bankruptcy of Rothstein Rosenfeldt Adler (RRA) regarding the sale of the property (In Re: Rothstein Rosenfeldt Adler, No. 09-34791, Chapter 11, S.D. Fla. Bkcy.).

Successor Future Claimants' Representative Appointed In W.R. Grace Case

WILMINGTON, Del. - The attorney for the longtime future claimants' representative (FCR) in W.R. Grace and Co.'s bankruptcy case will now represent the claimants following the death of the FCR, a federal bankruptcy judge in Delaware ruled May 30 (In re: W.R. Grace & Co., et al., No. 01-1139, D. Del. Bkcy.).

1st Circuit: Pleading Rules Don't Strip Qui Tam Suit Of 1st-To-File Status

BOSTON - A federal appeals court on June 3 said a False Claims Act lawsuit that pleads essential facts of fraud but that might not meet heightened pleading requirements can still bar a second, similar whistle-blower lawsuit under the first-to-file rule (United States of America, ex rel. Heidi Heineman-Guta v. Guidant Corporation, et al., No. 12-1867, 1st Cir.).

Retiring Bankruptcy Judge Transfers Pittsburgh Corning Chapter 11 Case

PITTSBURGH - Seven days after issuing final rulings confirming the plan of reorganization for Chapter 11 debtor Pittsburgh Corning Corp. (PCC), Pennsylvania federal Bankruptcy Judge Judith K. Fitzgerald, who is retiring from the bench, on May 31 transferred the case to another bankruptcy judge (In re: Pittsburgh Corning Corporation, No. 00-22876, W.D. Pa. Bkcy.).

Bankruptcy Judge Allows FAA Claims Of More Than $20M Against AMR Corp.

NEW YORK - The federal bankruptcy judge presiding over the Chapter 11 proceeding of AMR Corp., the parent company of American Airlines Inc., on May 31 ruled that the Federal Aviation Administration has allowed claims of more than $20 million against AMR and its affiliates (In Re: AMR Corp., No.11-15463, Chapter 11, S.D. N.Y. Bkcy.).

2nd Circuit Says Affiliate Of Bankrupt A&P Did Not Violate Lease

NEW YORK - A panel of the Second Circuit U.S. Court of Appeals on May 29 ruled that an affiliate of bankrupt The Great Atlantic & Pacific Tea Co. Inc. did not violate its lease by failing to get consent from its landlord to sublet part of its storefront to another business (Gator Monument Partners v. The Great Atlantic & Pacific Tea Company Inc. $(In Re: The Great Atlantic & Pacific Tea Company Inc.$), No. 12-3466, Chapter 11, 2nd Cir.; 2013 U.S. App. LEXIS 10741).

San Bernardino Creditor: Law Firm Disqualification Only For 'Most Extreme' Cases

RIVERSIDE, Calif. - Creditor National Public Finance Guarantee Corp. on May 30 filed a brief opposing the motion of the California Public Employees' Retirement System (CalPERS) that seeks to disqualify a law firm in the Chapter 9 bankruptcy of the City of San Bernardino, Calif., on grounds that the firm switched sides in what parties it now represents. National contends that disqualification is warranted only in the "most extreme" cases (In Re: City of San Bernardino, Calif., No. 12-28006, Chapter 9, C.D. Calif. Bkcy.).

Bankruptcy Judge OKs Deal With Dewey & LeBoeuf CEO, Insurer For More Than $19.5M

NEW YORK - The federal bankruptcy judge presiding over the Chapter 11 bankruptcy case of former law firm Dewey & LeBoeuf on May 30 approved a settlement valued at more than $19.5 million reached among the Dewey & LeBoeuf Liquidation Trust, XL Specialty Insurance Co. and Steven H. Davis, which resolves all claims held by the Liquidation Trust against Davis and XL (In Re: Dewey & LeBoeuf, No. 12-12321, Chapter 11, S.D. N.Y. Bkcy.).

GE Capital Seeks Stay Relief To Pursue More Than $1.34M From Bankrupt Kodak

NEW YORK - General Electric Capital Corp. (GECC) on May 29 moved in the U.S. Bankruptcy Court for the Southern District of New York for relief from the automatic stay in the Chapter 11 proceeding of Eastman Kodak Co. in order to pursue collection of more than $1.34 million in contract fees and damages pertaining to an aviation lease agreement between the parties (In Re: Eastman Kodak Company, No. 12-10202, Chapter 11, S.D. N.Y. Bkcy.).

Investors Offer $275M For Bankrupt Pharmaceutical Company K-V Discovery

NEW YORK - A group of investors on May 29 made a $275 million offer to buy bankrupt K-V Discovery Solutions Inc. (In Re: K-V Discovery Solutions Inc., No. 12-13346, Chapter 11, S.D. N.Y. Bkcy.).

Solyndra Creditor: $785M In Disputed Mechanics Liens Should Be Litigated

WILMINGTON, Del. - Kinetic Systems Inc., a creditor of bankrupt alternative energy company Solyndra LLC, on May 29 moved in the U.S. Bankruptcy Court for the District of Delaware for a ruling that it could pursue collecting on $785 million in mechanics liens it holds against Solyndra (In Re: Solyndra LLC, No. 11-12799, Chapter 11, D. Del. Bkcy.).

Bankrupt K-V Discovery Seeks $3M Settlement Of Medication Overpricing Lawsuit

NEW YORK - Bankrupt compounding pharmacy K-V Discovery Solutions Inc. on May 28 moved in New York federal bankruptcy court for approval of a $3 million settlement of claims asserted by the State of Texas related to alleged overpricing of medication (In Re: K-V Discovery Solutions Inc., No. 12-13346, Chapter 11, S.D. N.Y. Bkcy.).

Class: Directors, Officers Of Bankrupt ATP Oil & Gas Violated Securities Law

NEW ORLEANS - The Firefighters Pension & Relief Fund of the City of New Orleans (FPRF) on May 24 filed a class action against the directors and officers of bankrupt ATP Oil & Gas, alleging that they violated securities laws by providing misleading information before filing for Chapter 11 bankruptcy (Firefighters Pension & Relief Fund of the City of New Orleans v. T. Paul Bulmahn, et al., No. 13-03935, E.D. La.).

Quasi-Contractual Claims Cannot Stand Because Of Contract, Reinsurer Says

NEW YORK - A reinsurer told a New York federal court on May 24 that claims brought against it by a reinsurance broker are quasi-contractual and cannot be sustained when there is a valid contract between the parties (Guy Carpenter & Company, LLC v. Excalibur Reinsurance Corporation f/k/a PMA Capital Insurance Company, No. 13-cv-02756, S.D. N.Y.).

Arcapita Bank Seeks $175M In Additional Financing To Exit Chapter 11 Bankruptcy

NEW YORK - Bankrupt Arcapita Bank B.S.C. on May 28 moved in the U.S. Bankruptcy Court for the Southern District of New York for authorization to obtain an additional $175 million in post-petition financing, also called debtor-in-possession (DIP) financing, that would be used as replacement financing to repay existing DIP financing (In Re: Arcapita Bank, No. 12-11076, Chapter 11, S.D. N.Y. Bkcy.).

4th Circuit Says Trustee May Not Recover Assets Of Bankrupt Derivium Capital

RICHMOND, Va. - A panel of the Fourth Circuit U.S. Court of Appeals on May 24 affirmed a bankruptcy court's ruling and said assets the trustee claimed were fraudulently transferred could not be recovered (Grayson Consulting Inc. v. Wachovia Securities $(In Re: Derivium Capital LLC$), No. 12-1518, Chapter 7, 4th Cir.; 2013 U.S. App. LEXIS 10529).

Kodak: Expense Claim Should Be Denied Firm For Failure To Perform Its Duties

NEW YORK - Bankrupt Eastman Kodak Co. on May 24 filed a brief in the U.S. Bankruptcy Court for the Southern District of New York arguing that the bankruptcy court should not allow a $258,968.43 administrative expense claim asserted by a firm Kodak hired to provide services related to underlying patent litigation because the firm failed to perform its duties under the contract (In Re: Eastman Kodak Company, No. 12-10202, Chapter 11, S.D. N.Y. Bkcy.).

2nd Circuit Reverses; Creditor May Set Off Judgment She Owes Against Claim

NEW YORK - A panel of the Second Circuit U.S. Court of Appeals on May 28 reversed and remanded a bankruptcy court's ruling and determined that a creditor was entitled to have a $226,000 judgment she owes set off by her claim against the debtor's bankruptcy estate (Sally Ogden v. Ronald Ian Chorches $(In Re: Bolin & Co. LLC$), No. 12-1310, Chapter 7, 2nd Cir.; 2013 U.S. App. LEXIS 10614).

Creditor: Bankruptcy Court Should Deny Cash Collateral For Bankrupt Laser Company

FORT WORTH, Texas - A creditor of Primcogent Solutions LLC, a distributor of a non-invasive body contouring laser, on May 27 filed a brief in the U.S. Bankruptcy Court for the Northern District of Texas objecting to Primcogent's motion seeking cash collateral on grounds that the money should not be approved because the company is litigating a contract dispute with the supplier that makes Primcogent's business operation possible in the first place (In Re: Primcogent Solutions LLC, No. 13-42368, Chapter 11, N.D. Texas Bkcy.).