LexisNexis® Legal Newsroom
News Corp. Directors And Officers Settle Shareholder Dispute For $139 Million

WILMINGTON, Del. - Parties to a shareholder derivative suit against directors and officers of News Corp. informed a Delaware vice chancellor on April 22 that they had reached a $139 million settlement of their dispute (In re News Corporation Shareholder Derivative Litigation, No. 6285-VCN, Del. Chanc.).

Tribune Indenture Trustee Defends Fee Request Of More Than $6.1 Million

WILMINGTON, Del. - The Law Debenture Trust Company of New York (LDTCNY) on April 23 filed a brief contending that its request for fees and expenses related to the bankruptcy of media giant Tribune Co. is appropriate because LDTCNY made "substantial contributions" to the case (In Re: Tribune Company, No. 08-13141, Chapter 11, D. Del. Bkcy.).

Ritz Camera Trustee Must Sell Asset To Higher Bidder, Says Buyer With $1.9M Offer

WILMINGTON, Del. - A potential buyer of one of bankrupt Ritz Camera & Image LLC's assets on April 22 filed a brief objecting to the Chapter 7 trustee's motion seeking authorization to sell the asset, a piece of real property, to a different purchaser for $100,000 less (In Re: Ritz Camera & Image LLC, No. 12-11868, Chapter 7, D. Del. Bkcy.).

'Girls Gone Wild' Trustee Sues Founder For Intimidating Employees, Violating Stay

LOS ANGELES - The Chapter 11 trustee in the bankruptcy of GGW Brands Inc., the parent company for the company that produces adult videos under the name "Girls Gone Wild," on April 23 sued GGW's founder seeking sanctions and damages for allegedly interfering with the trustee's attempts to conduct the bankruptcy (In Re: Todd Nielson v. Joseph Francis [In Re: GGW Brands Inc.], No. 13-15130, Chapter 11, C.D. Calif. Bkcy.).

Ore. Federal Judge Says N.J. Punitives Law Applies In Zometa Jaw Injury Case

PORTLAND, Ore. - An Oregon woman who claims that Zometa caused her jaw injury cannot claim punitive damages against defendant Novartis Pharmaceuticals Corp. because they are prohibited by New Jersey state law, an Oregon federal judge ruled April 22 (Patricia Stromenger v. Novartis Pharmaceuticals Corporation, No. 3:12-686, D. Ore.).

United States Sues 'Repeat Offender' Novartis For Kickback Scheme, Medicare Costs

NEW YORK - Calling Novartis Pharmaceuticals Corp. (NPC) a "repeat offender," a U.S. attorney on April 23 filed a False Claims Act and kickback lawsuit in New York federal court, alleging that the company cost Medicare and Medicaid tens of millions of dollars by paying illegal kickbacks to about 20 pharmacies to switch kidney transplant patients from cheaper generic anti-rejection drugs to Novartis' Myfortic (United States of America v. Novartis Pharmaceuticals Corporation, No. 11-8196, S.D. N.Y.).

Committee In Rhythm And Hues Case Opposes $425,000 Break-Up Fee For Failed Bid

LOS ANGELES - The Official Committee of Unsecured Creditors in the Chapter 11 bankruptcy of Rhythm And Hues Inc. (RAH), which provided the visual special effects for the film "Life of Pi," on April 22 filed a brief contending that a stalking horse bidder is not entitled to a $425,000 break-up fee (In Re: Rhythm And Hues Inc., No. 13-13775, Chapter 11, C.D. Calif. Bkcy.).

11th Circuit: Trustee May Not Recover $536,686.91 Debtor Transferred To IRS

ATLANTA - A panel of the 11th Circuit on April 23 ruled that the Internal Revenue Service was entitled to the good faith defense regarding the prepetition transfer of $536,686.91 it received from a debtor company and, therefore, the trustee could not recover the money for the bankruptcy estate (Soneet R. Kapula v. Internal Revenue Service $(In Re: ATM Financial Services LLC$), No. 12-11690, Chapter 11, 11th Cir.; 2013 U.S. App. LEXIS 8129).

Asbestos Claims Force Former Manufacturer Into Bankruptcy

WILMINGTON, Del. - Yarway Corp., a former Pennsylvania company that manufactured pipe clamps, steam traps, valves and controls, filed for Chapter 11 protection April 22 in Delaware federal bankruptcy court due to thousands of asbestos personal injury claims combined with the depletion of insurance assets to pay the claims (In re: Yarway Corporation, No. 13-11025, D. Del. Bkcy.).

Dewey & LeBoeuf Trustee Seeks Approval Of Deal With CEO Valued At More Than $19.5M

NEW YORK - The Dewey & LeBoeuf Liquidating Trust on April 22 moved in the U.S. Bankruptcy Court for the Southern District of New York for approval of a settlement valued at more than $19.5 million between the trust, Dewey & LeBoeuf's former CEO and his insurance company (In Re: Dewey & LeBoeuf, No. 12-12321, Chapter 11, S.D. N.Y. Bkcy.).

MF Global Trustee Sues Corzine And Other Directors For Breaches Causing Bankruptcy

NEW YORK - The Chapter 11 trustee in the bankruptcy proceeding of MF Global Holdings Ltd. (MFGH) on April 22 sued former MFGH CEO Jon Corzine and other top executives in the U.S. Bankruptcy Court for the Southern District of New York, alleging that they breached their fiduciary duties and led MFGH into bankruptcy (In Re: MF Global Holdings Ltd., No. 11-15059, Chapter 11, S.D. N.Y. Bkcy.).

Liquor Company's $172M Deal Prohibited By Bankruptcy Code, U.S. Trustee Argues

WILMINGTON, Del. - The U.S. trustee in the Chapter 11 bankruptcy of liquor company Central European Distribution Corp. (CEDC) on April 22 filed a brief objecting to the debtor's motion seeking approval a $172 million investment agreement on grounds that the assumption of the contract at the heart of the investment agreement is prohibited by the Bankruptcy Code (In Re: Central European Distribution Corporation, No. 13-10738, Chapter 11, D. Del. Bkcy.).

California Appeals Court Rules Widow Has Triable Evidence Of Benzene Injury

SANTA ANA, Calif. - A California appeals court has reversed dismissal of a widow's claims that exposure to benzene in Rust-Oleum Corp. products caused her husband's 2007 death from acute myelogenous leukemia (AML), saying in an unpublished April 19 opinion that Anne Gregorio had presented a triable controversy (Anne Gregorio v. Rust-Oleum Corporation, No. G046533, Calif. App., 4th Dist., Div. 3; 2013 Cal. App. Unpub. LEXIS 2781).

Bankruptcy Judge OKs $17.55M Asset Sale, Takeover Of Entertainment Publications

WILMINGTON, Del. - The federal bankruptcy judge presiding over the Chapter 7 proceeding of Entertainment Publications LLC on April 22 authorized the sale of the company's assets to a stalking horse bidder for $17.55 million and authorized the trustee to take over operations of the debtor company (In Re: Entertainment Publications LLC, No. 13-10496, Chapter 7, D. Del. Bkcy.).

Judges Enters Judgment In Favor Of Insurers In Suit Prompted By Hazing Death

LOS ANGELES - A California federal judge on April 19 entered judgment in favor of a primary and an excess insurer in a coverage dispute arising from an alcohol-related fraternity hazing death, finding that the insurers have no duty to indemnify the members of a local chapter of a fraternity for their responsibility in the hazing death (Liberty Corporate Capital Ltd. v. California Tau Chapter of Sigma Alpha Epsilon Fraternity at California Polytechnic State University, et al., No. 2:11-cv-02626-ODW $(FFMx$), C.D. Calif.; 2013 U.S. Dist. LEXIS 56697).

9th Circuit Says Deloitte Not Liable; Misconduct Imputed To Debtor Company

SAN FRANCISCO - A panel of the Ninth Circuit U.S. Court of Appeals on April 22 ruled that a liquidating trust's claims against a debtor's former auditor failed because any misconduct related to the concealment of financial information in the bankruptcy was imputed to the debtor company and not the auditor (USACM Liquidating Trust v. Deloitte & Touche, No. 11-15626, Chapter 11, 9th Cir.).

1st Circuit: Sales Manager Failed To Prove Termination Was Due To Age Bias

BOSTON - A former computer network and storage systems sales manager failed to show that his age, rather than decreasing sales, caused his termination, the First Circuit U.S. Court of Appeals ruled April 18 (Frank Woodward v. Emulex Corporation, et al., No. 12-1612, 1st Cir.; 2013 U.S. App. LEXIS 7778).

Bankruptcy Judge: $35M Claim Against MF Global 'Frivolous'; Sanctions Imposed

NEW YORK - The federal bankruptcy judge presiding over the Chapter 11 case of MF Global Holdings Ltd. (MFGH) on April 18 expunged a $35 million claim against the financial services company and sanctioned the woman who brought the claim $250 because it was "frivolous" (In Re: MF Global Holdings Ltd., No. 11-15059, Chapter 11, S.D. N.Y. Bkcy.).

High Court Won't Review Filed-Rate Doctrine, Indirect Purchaser Rulings

WASHINGTON, D.C. - The U.S. Supreme Court on April 22 declined to review the Second Circuit U.S. Court of Appeals ruling that a consumer who alleged that a New York City provider of electricity-generating capacity violated antitrust laws by engaging in a swap transaction lacks antitrust standing because he was an indirect purchaser and that his claims are otherwise barred by the filed-rate doctrine (Charles Simon v. KeySpan Corporation, et al., No. 12-919, U.S. Sup.).

Ricoh Sues Kodak, Alleges Post-Petition Copyright Infringement

NEW YORK- Ricoh Co. Ltd. on April 19 sued bankrupt Eastman Kodak Co. in the U.S. Bankruptcy Court for the Southern District of New York, seeking declaratory and injunctive relief for alleged post-petition patent infringement (Ricoh Company Ltd. v. Eastman Kodak Company $(In Re: Eastman Kodak Company$), No. 12-10202, Adv. No. 13-01332, Chapter 11, S.D. N.Y. Bkcy.).

W.R. Grace Asbestos Trust To Receive $900,000 From Deal With Insurer

WILMINGTON, Del. - A federal bankruptcy judge in Delaware on April 17 approved a settlement agreement between Chapter 11 debtor W.R. Grace & Co. and one of its insurers that will provide more than $900,000 to the debtor's asbestos personal injury trust in one lump-sum payment rather than in installments (In re: W.R. Grace & Co., et al., No. 01-01139, D. Del. Bkcy.).

5th Circuit: Debtor Company's Principal Lacks Standing; Claims Properly Dismissed

NEW ORLEANS - A panel of the Fifth Circuit U.S. Court of Appeals on April 18 ruled that the claims made by a principal of a company that filed for bankruptcy were moot because they were derivative of other claims and he lacked standing to challenge the order dismissing those claims (Lewis Miller Smyth v. Simeon Land Development $(In Re: Escarent Entities$), No. 12-50297, Chapter 11, 5th Cir.; 2013 U.S. App. LEXIS 7779).

Maritime Company In Asbestos MDL Files Chapter 7 Petition

NEW YORK - A New York steamship and maritime company that is a defendant in 28 cases in a multidistrict asbestos litigation filed a notice April 16 in a Pennsylvania federal court that it has filed a voluntary Chapter 7 petition in New York federal bankruptcy court (In re: Asbestos Products Liability Litigation $(No. VI$), MDL No. 02-875, E.D. Pa.).

Indenture Trustee: Tribune's Denial Of Fees 'Meritless'; Notions 'Preposterous'

WILMINGTON, Del. - Deutsche Bank Trust Company Americas (DBTCA), as successor indenture trustee, on April 16 filed a brief in the U.S. Bankruptcy Court for the District of Delaware contending that the objection of the reorganized version of bankrupt Tribune Co. to its fee request is "meritless" (In Re: Tribune Company, No. 08-13141, Chapter 11, D. Del. Bkcy.).

$9.5 Million Cash Settlement Approved In Bar Review Antitrust Action

LOS ANGELES - A federal judge in California on April 15 preliminary approved a $9.5 million settlement of a class action brought by law students against West Publishing Co. and Kaplan Inc. for conspiring to restrain trade in the market for bar review preparation courses, following his rejection of an earlier settlement (Stephen Stetson, et al. v. West Publishing Corporation, No. CV-08-00810, C.D. Calif.).