LexisNexis® Legal Newsroom
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.).

Secured Lender Trustee In Dewey & LeBoeuf Case Seeks Recovery Of More Than $3.5M

NEW YORK - The secured lender trustee in the Chapter 11 bankruptcy of former law firm Dewey & LeBoeuf on Aug. 22 filed six adversary complaints against various former clients of the firm, seeking to recover more than $3.5 million for the bankruptcy estate. The complaint seeking the largest individual recovery is against OfficePower Inc. for more than $2.3 million (FTI Consulting Inc. v. OfficePower Inc. $(In Re: Dewey & LeBoeuf$), Adv. No. 13-01420, No. 12-12321, Chapter 11, S.D. N.Y. Bkcy.).

Kentucky Federal Judge Stays Dispute Over Refrigerator Shelving Patent

LOUISVILLE, Ky. - Although denying dismissal, a Kentucky federal judge on Aug. 21 agreed to stay a patent dispute pending the outcome of a defendant's application for inter partes re-examination by the U.S. Patent and Trademark Office (PTO) (SSW Holding Company Inc. v. Schott Gemtron Corporation, No. 12-661, W.D. Ky.).

Airline Customers: AMR Merger Should Not Be Confirmed While Lawsuits Are Pending

NEW YORK - A group of individuals who have already sued bankrupt AMR Corp. opposing its proposed merger with US Airways Inc. on antitrust grounds on Aug. 22 filed a brief arguing that the deal should not be confirmed while there is an additional antitrust lawsuit pending by the U.S. Department of Justice (DOJ) (In Re: AMR Corporation, No. 11-015463, Chapter 11, S.D. N.Y. Bkcy.).

U.S. Trustee: AgFeed Fails To Provide Financial Data Needed To Conduct Asset Sale

WILMINGTON, Del. - The U.S. trustee in the Chapter 11 bankruptcy of agricultural business AgFeed USA LLC on Aug. 21 filed a brief objecting to the company's motion seeking approval to sell substantially all of its assets on grounds that the company has failed to provide reliable financial data needed to conduct a sale (In Re: AgFeed USA LLC, No. 13-11761, Chapter 11, D. Del. Bkcy.).

Bankrupt Insurer May Depose Unsecured Creditors Committee On Valuation Issue

NEW YORK - The federal bankruptcy judge presiding over the Chapter 11 proceeding of Excel Maritime Carriers Ltd. on Aug. 20 approved a motion filed by the debtor seeking to depose a group of companies that are members of the Official Committee of Unsecured Creditors (In Re: Excel Maritime Carriers Ltd., No. 13-23060, Chapter 11, S.D. N.Y. Bkcy.).

7th Circuit Reverses In Part; Constitutional Objection Is Not 'Waivable'

CHICAGO - A panel of the Seventh Circuit U.S. Court of Appeals on Aug. 21 partially reversed and remanded a case involving a Chapter 7 debtor on grounds that a constitutional objection on the basis of the U.S. Supreme Court ruling in Stern v. Marshall (131 S. Ct. 2594 $(2011$)) is not waivable because it involves issues of separation of powers (Wellness International Network Ltd. v. Richard Sharif, No. 12-1349, Chapter 7, 7th Cir.; 2013 U.S. App. LEXIS 17553).

3rd Circuit Vacates Bayer WeightSmart Vitamin Class For Lack Of 'Ascertainability'

PHILADELPHIA - The Third Circuit U.S. Court of Appeals on Aug. 21 vacated certification of a Florida statewide class of consumers who bought Bayer Corp.'s WeightSmart combination multivitamin/dietary supplement, saying the plaintiff has shown no reliable way to ascertain class membership and valid claims (Gabriel Joseph Carrera, et al. v. Bayer Corporation, et al., No. 12-2621, 3rd Cir.; 2013 U.S. App. LEXIS 17479).

8th Circuit BAP Reverses; Holding Company Liable To Patriot Coal's Employees

ST. LOUIS - The U.S. Bankruptcy Appellate Panel (BAP) for the Eighth Circuit on Aug. 21 reversed a bankruptcy court's ruling and held that a holding company that formerly had an employee agreement with bankrupt Patriot Coal Corp. still had liabilities regarding health care provisions for employees (Patriot Coal Corporation v. Peabody Holding Company $(In Re: Patriot Coal Corporation$), No. 13-6031, Chapter 11, 8th Cir. BAP).

Dynegy Holdings Seeks Approval For $3.5 Million Asset Sale To Helios Power Capital

NEW YORK - Bankrupt energy company Dynegy Holdings LLC on Aug. 20 moved in the U.S. Bankruptcy Court for the Southern District of New York for approval of a $3.5 million asset purchase agreement (APA) with energy company Helios Power Capital LLC (In Re: Dynegy Holdings LLC, No. 11-38111, Chapter 11, S.D. N.Y. Bkcy.).

Potential Coverage Exists For Employee Theft Claim, Federal Judge Rules

INDIANAPOLIS - An insured's claim that its insurer owed a duty to indemnify it up to the coverage limits available for the insured's more than $5 million theft loss raises a right to relief beyond the speculative level, an Indiana federal judge ruled Aug. 20, denying the insurer's motion for judgment on the pleadings (Telamon Corporation v. The Charter Oak Fire Insurance Co., et al., No. 1:13-cv-00382-RLY-DML, S.D. Ind.; 2013 U.S. Dist. LEXIS 117646).

6th Circuit: Creditor Had No Right To Appeal Order Denying Consolidation

CINCINNATI - A panel of the Sixth Circuit U.S. Court of Appeals on Aug. 20 affirmed a bankruptcy court's decision denying a creditor's motion to consolidate two related bankruptcies on grounds that the order was not final; therefore, it had no right to appeal (Huntington National Bank v. Thomas Richardson $(In Re: Cyberco Holdings Inc.$), No. 10-2537, Chapter 7, 6th Cir.; 2013 U.S. App. LEXIS 17263).

3rd Circuit Affirms Imposition Of Monetary, Dismissal Sanctions

PHILADELPHIA - A Third Circuit U.S. Court of Appeals panel on Aug. 20 found that a federal judge in Pennsylvania did not err in imposing monetary sanctions against a plaintiff for his failure to timely comply with discovery requests and later dismissing the suit with prejudice as a result of the plaintiff's refusal to pay (Percy Hogan Jr. v. Raymond Corporation, et al., No. 12-4052, 3rd Cir.; 2013 U.S. App. LEXIS 17282).

Casa Casuarina Creditors: RRA Trustee's More Than $4.92M Claim Should Be Rejected

FORT LAUDERDALE, Fla. - A group of secured creditors in the Chapter 11 bankruptcy of Casa Casuarina LLC, the former mansion of designer Gianni Versace, on Aug. 19 filed a brief objection to a proof of claim of more than $4.92 million filed by the liquidating trustee in the related bankruptcy of the former law firm Rothstein Rosenfeldt Adler (RRA) (In Re: Casa Casuarina LLC, No. 13-25645, Chapter 11, S.D. Fla. Bkcy.).