LexisNexis® Legal Newsroom
American Airlines, US Airways: Government Wrong; November Trial Date 'Reasonable'

WASHINGTON, D.C. - US Airways Inc. and American Airlines Inc. filed a joint reply brief I in the U.S. District Court for the District of Columbia on Aug. 28, arguing that the U.S. Department of Justice's (DOJ) motion to set a March trial date for the prosecution of its antitrust lawsuit opposing the merger of the two airlines would cause risk and harm to American Airlines' ability to emerge from Chapter 11 bankruptcy (United States of America v. US Airways Inc., et al., No. 13-01236, D. D.C.).

Corporation Can Enforce Loan Guaranties, Federal Judge Finds

DETROIT - A federal judge in Michigan on Aug. 28 awarded summary judgment to a corporation that sued to enforce guaranty obligations relating to a loan, finding that the chain of title and the corporation's right to enforce the guaranties are found in the record (Fourteen Corp. v. Michael Magnoli Jr., et al., No. 13-11803, E.D. Mich.; 2013 U.S. Dist. LEXIS 122269).

Government Says 6 Months Of Discovery Needed In American Airlines Antitrust Trial

NEW YORK - The U.S. Department of Justice (DOJ) on Aug. 27 filed a brief and a proposed scheduling order in its antitrust lawsuit seeking to prevent the planned merger of American Airlines Inc. and US Airways Inc., arguing that "given what is at stake," the district court hearing the case should allow both sides "a full opportunity" to develop evidence in discovery in preparation for a trial (United States of America v. US Airways Inc., et al., No. 13-01236, D. D.C.).

Residential Capital Seeks Stay Extension; Underlying Case Should Not Proceed

NEW YORK - Bankrupt Residential Capital LLC (ResCap) and a group of its affiliated debtors on Aug. 28 moved in the U.S. Bankruptcy Court for the Southern District of New York to extend the automatic stay to enjoin the prosecution of claims against its nondebtor affiliate in an underlying, separate class action related to allegations of improprieties in residential mortgage lending (In Re: Residential Capital LLC, No. 12-12020, Chapter 11, S.D. N.Y. Bkcy.).

Bankrupt K-V Discovery Reaches $23.8M Settlement With States, Federal Government

NEW YORK - Bankrupt pharmaceutical company K-V Discovery Solutions Inc. on Aug. 28 reached an agreement under which it will pay the United States and certain states asserting Medicaid claims $23.8 million to settle criminal fines and claims made against the bankruptcy estate (In Re: K-V Discovery Solutions Inc., No. 12-13346, Chapter 11, S.D. N.Y. Bkcy.).

Irish Bank Seeks Recognition Of Foreign Main Proceeding By U.S. Bankruptcy Court

WILMINGTON, Del. - Officials with the Irish Bank Resolution Corp. (IBRC) Ltd. on Aug. 28 filed a brief supporting the bank's contention that the U.S. Bankruptcy Court should recognize a proceeding in Ireland as a foreign main proceeding a under the Bankruptcy Code (In Re: Irish Bank Resolution Corporation Ltd., No. 13-12159, Chapter 15, D. Del. Bkcy.).

U.S. Trustee: $145,000 Bonus Should Be Denied Based On Its 'Retentive' Nature

WILMINGTON, Del. - The U.S. trustee in the Chapter 11 bankruptcy of IPC International Corp. on Aug. 27 filed a brief objecting to the company's plan to pay a $145,000 bonus to IPC's chief financial officer (CFO) for work done before the filing of the bankruptcy petition, which makes it "retentive" in nature, which is a violation of Bankruptcy Code (In Re: IPC International Corporation, No. 13-12050, Chapter 11, D. Del. Bkcy.).

Kmart Settles Cashier Seating Class Suit For $280,000

SAN FRANCISCO - A California federal judge on Aug. 23 granted preliminary approval of a $280,000 settlement to be paid by Kmart Corp. to end a class complaint by cashiers alleging that they were denied seats at the checkout stands (Colette Delbridge, et al. v. Kmart Corporation, No. 11-2575, N.D. Calif.; 2013 U.S. Dist. LEXIS 120377).

Detroit Retirement Groups: Nondisclosure Statement For Data Access Must Be Waived

DETROIT - A group of retirement systems covering employees of the bankrupt City of Detroit on Aug. 27 filed a brief seeking the waiver of a nondisclosure statement they signed pertaining to access to confidential information kept in the city's data room (In Re: City of Detroit, No. 13-53846, Chapter 9, E.D. Mich. Bkcy.).

9th Circuit Seeks Briefing From Plant, Insurers On Contribution Rights

SAN FRANCISCO - The Ninth Circuit U.S. Court of Appeals on Aug. 23 directed Chapter 11 debtor Plant Insulation Co. and insurance companies appealing Plant's confirmed plan of reorganization to provide additional briefing on the insurers' argument that the plan and its injunctions affect their contribution rights (In Re: Plant Insulation Company $(Fireman's Fund Insurance Company, et al., v. Plant Insulation Company, et al., Nos. 12-17466 and 12-17467, 9th Cir.$)).

3rd Circuit: $47M Award Valid, But Other Claims Belong In Bankruptcy Court

PHILADELPHIA - A panel of the Third Circuit U.S. Court of Appeals on Aug. 27 affirmed a bankruptcy court's decision that the lifting of the automatic stay was limited in its scope to allow a $47 million award for the creditor but that additional claims against the debtor had to be litigated in bankruptcy court (In Re: ABC Learning Centres Ltd n/k/a ZYX Learning Centres Ltd., No. 12-2808, Chapter 15, 3rd Cir.; 2013 U.S. App. LEXIS 17844).

Ill. Federal Judge Dismisses Antitrust Claims Against Health Insurer, Hospital

EAST ST. LOUIS, Ill. - An Illinois federal judge on Aug. 26 dismissed antitrust claims brought by an outpatient surgery center against a health insurance company and a corporation owning multiple hospitals in Illinois, holding that the plaintiff failed to properly show a relevant market (Marion Healthcare v. Southern Illinois Healthcare, et al., No. 12-871, S.D. Ill.; 2013 U.S. Dist. LEXIS 120722).

Federal Judge Confirms $400 Million Award, Finds Mexican Court Erred

NEW YORK - A New York federal judge on Aug. 27 granted a Mexican corporation's request to confirm an approximately $400 million arbitration award that was issued in its favor in a dispute over contracts for the construction of offshore platforms, finding that a Mexican court that nullified the award improperly applied a law that was not in existence at the time the parties entered the underlying agreements (Corporacion Mexicana De Mantenimiento Intergral, S. De R.L. De C.V. v. Pemex-Exploracion Y Produccion, No. 1:10-cv-00206, S.D. N.Y.).

New York Appeals Court Affirms Denial Of Injunction Prohibiting Mold Renovation

NEW YORK - A New York appeals court on Aug. 27 affirmed a trial court's decision to deny a cooperative shareholder's request for a preliminary injunction prohibiting the building's board from completing mold-related and water damage renovations, finding that she failed to show that the renovations would cause her irreparable harm (Maro A. Goldstone, et al. v. Gracie Terrace Apartment Corporation, No. 604235/07 9341, N.Y. Sup., App. Div., 1st Dept.; 2013 N.Y. App. Div. LEXIS 5637).

U.S. Trustee: Counsel For Bankrupt 'Girls Gone Wild' Must Turn Over $20,000

LOS ANGELES - The U.S. trustee in the Chapter 11 bankruptcy of the company that makes adult videos carrying the name "Girls Gone Wild" on Aug. 27 moved in bankruptcy court for the company's bankruptcy attorney Robert M. Yaspan to return $20,000 to the bankruptcy estate on grounds that he failed to provide "competent legal services" and that the amount of money was not "reasonable" in the first place (In Re: GGW Brands LLC, No. 13-15130, Chapter 11, C.D. Calif. Bkcy.).

Thelen Trustee Seeks $853,292 From Former Partners As Fraudulent Conveyances

NEW YORK - The Chapter 7 trustee in the bankruptcy of former law firm Thelen LLP on Aug. 23 filed six adversary complaints against former partners of the firm, seeking to recover a total of $853,292 on grounds that the money belongs to the estate because it constituted fraudulent conveyances (In Re: Thelen LLP, No. 09-15631, Chapter 7, S.D. N.Y. Bkcy.).

Kodak Seeks OK Of Deal In Which It Would Retain 15 Of 18 Disputed Patents

NEW YORK - Bankrupt Eastman Kodak Co. on Aug. 26 moved in bankruptcy court for approval of a settlement agreement with Global OLED Technology (GOT) LLC under which Kodak would retain 15 of 18 disputed patents related to Organic Light Emitting Diodes (OLEDs) (In Re: Eastman Kodak Company, No. 12-10202, Chapter 11, S.D. N.Y. Bkcy.).

Shareholders Ask Court To Grant Final Approval Of Derivative Suit Settlement

SAN FRANCISCO - A group of shareholders asked a California federal court on Aug. 22 to give final approval to a settlement with a company's directors and officers that implements corporate governance measures that address certain alleged wrongdoing (Scott Ozaki, derivatively on behalf of Oracle Corporation, et al. v. Lawrence J. Ellison, et al., No. 11-cv-04493, N.D. Calif.).

Detroit, Plaintiff Stipulate To Stay Relief Related To Underlying State Lawsuit

DETROIT - Attorneys for the bankrupt City of Detroit and a plaintiff who has sued the city under the Michigan Open Meetings Act (OMA) in state court reached a stipulated agreement on Aug. 26 that the automatic stay in the bankruptcy does not apply to the OMA lawsuit (In Re: City of Detroit, No. 13-53846, Chapter 9, E.D. Mich. Bkcy.).

Federal Judge Won't Dismiss Patent Action On Jurisdiction Grounds

WILMINGTON, Del. - A dispute over a patented process for blocking television programming will proceed in Delaware federal court, thanks to a judge's Aug. 23 ruling (Rovi Corporation, et al. v. Haier Group, et al., No. 11-1140, D. Del.).

Delaware Court Hears Arguments Over Appointment Of Receiver For Dissolved Company

WILMINGTON, Del. - The Delaware Supreme Court on Aug. 21 heard oral arguments on whether a judge erred by not appointing a receiver to handle the undistributed insurance proceeds of a dissolved corporation based on asbestos plaintiffs' inability to prevail in actions against it (Anderson v. Krafft-Murphy Co., No. 85,2013, Del. Sup.).

Detroit Seeks Discovery From Retired Police Officers Group Regarding Benefits

DETROIT - The bankrupt City of Detroit on Aug. 23 filed interrogatories seeking to obtain discovery from the Retired Detroit Police Members Association (RDPMA) regarding its legal authority and the knowledge it has pertaining to proposals dealing with retirees' health benefits (In Re: City of Detroit, No. 13-53046, Chapter 9, E.D. Mich. Bkcy).

U.S. Attorney Seeks Injunction Blocking American Airlines Merger 'In Its Entirety'

NEW YORK - The U.S. attorney for the Southern District of New York on Aug. 23 filed a statement in the Chapter 11 bankruptcy of AMR Corp., the parent company of American Airlines Inc., seeking a permanent injunction blocking "in its entirety" the proposed merger of American Airlines and US Airways Inc. (In Re: AMR Corporation, No. 11-15463, Chapter 11, S.D. N.Y. Bkcy.).

Panel: Court Did Not Err In Relying On Testimony Of Insurer's Expert Witness

NEW ORLEANS - A Louisiana appeals panel on Aug. 21 found that a lower court did not err in relying on an expert witness' opinion that an insured's structural damage was caused by soil subsidence and not wind, affirming the lower court's ruling in favor of the homeowners insurer in a Hurricane Katrina coverage dispute (James And Rebecca Wallace, et al. v. Louisiana Citizens Property Insurance Corporation, et al., No. 2013-CA-0075, La. App., 4th Cir.; 2013 La. App. LEXIS 1697).

Detroit: Granting Stay Relief Would Deplete Resources, 'Undermine' City

DETROIT - The bankrupt City of Detroit on Aug. 22 filed a brief in the U.S. Bankruptcy Court for the Eastern District of Michigan contending that a creditor should not be granted relief from the automatic stay in order to pursue litigation pertaining to a separate, underlying action commenced before the city filed for bankruptcy (In Re: City of Detroit, No. 13-53846, Chapter 9, E.D. Mich. Bkcy.).