LexisNexis® Legal Newsroom
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.).

Class Certified In Suit Seeking More Than $42M For Extra Rental Car Fees

RENO, Nev. - A Nevada federal judge on March 21 certified a class of rental car customers seeking more than $42 million for concession fees paid by the rental car company and passed on to customers as fees outside of the quoted rental rates; the judge also granted a partial motion for summary judgment to the plaintiffs and denied a motion by the defendant (Janet Sobel, et al. v. The Hertz Corporation, No. 06-545, D. Nev.; 2014 U.S. Dist. LEXIS 40471).

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.).

Judge Finds Disclosures Did Not Violate Truth In Lending Act

BOSTON - A federal judge in Massachusetts on March 20 awarded summary judgment to PNC Mortgage Corp. on a woman's claims that disclosures she received when closing on her mortgage loan were inadequate under the Truth in Lending Act (TILA) and the equivalent state statute but found that she can pursue her unjust enrichment claim because genuine disputes exist as to whether she was fraudulently induced into entering the agreement (Jennifer Broderick v. PNC Mortgage Corporation, No. 11-10047-JLT, D. Mass.; 2013 U.S. Dist. LEXIS 38642).

Pennsylvania Judge Won't Dismiss Patent Action

PITTSBURGH - Relying on Execware, LLC v. Staples, Inc. (D. Del. Dec. 10, 2012) for support, a Pennsylvania federal judge on March 22 denied dismissal of a patent infringement case, citing written correspondence between counsel for a plaintiff and defendant as sufficient for establishing willfulness (Brookville Equipment Corporation v. A.L. Lee Corporation, No. 13-59, W.D. Pa.).

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.).

La. Federal Judge Dismisses Class Claims Accusing Viking Of Faulty Products

NEW ORLEANS - A Louisiana federal judge on March 20, following the guidelines in Wal-Mart Stores, Inc. v. Dukes (131 S.Ct. 2541, 2550 $(2011$)), dismissed class action allegations accusing Viking Range Corp. of manufacturing faulty products and remanded the individual claims to state court (Catherine Duvio, et al. v. Viking Range Corporation, et al., No. 12-1430, E.D. La.; 2013 U.S. App. LEXIS 38592).

Director And Officer Say Court Does Not Have Jurisdiction Over Suit

NEW YORK - A director and an officer of a banking corporation who were sued for negligent misrepresentation told a New York federal court on March 20, that the New York court does not have jurisdiction over a shareholder's suit against them (SBAV LP v. Porter Bancorp, Inc., et al., No. 13-cv-00372, S.D. N.Y.).

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.).

Federal Circuit Says No Subpoenas In Re-examination Proceedings

WASHINGTON, D.C. - A Virginia judge properly quashed two subpoenas issued pursuant to 35 U.S. Code Section 24 in an inter partes re-examination proceeding, the Federal Circuit U.S. Court of Appeals ruled March 20 in a case of first impression (Abbott Laboratories v. Cordis Corporation, No. 12-1244, Fed. Cir.).

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.).

Tennessee Federal Judge Transfers Junk Fax Suit To Ohio Federal Court

KNOXVILLE, Tenn. - A Tennessee federal judge on March 14 agreed to transfer a class complaint over unsolicited faxed advertisements to an Ohio federal court, where a similar case was filed several months earlier (McLaughlin Chiropractic Associates, Inc., et al. v. McKesson Corporation, et al., No. 13-11, E.D. Tenn.; 2013 U.S. Dist. LEXIS 35263).

Judge Finds Policy Excluded Mold Damage In Townhouse Development

MINNEAPOLIS - A Minnesota federal judge on March 18 granted summary judgment for an insurer, finding that a policy issued to the builder of a townhouse complex that contained numerous construction defects clearly excluded coverage related to mold growth (MM Home Builders Inc., as assignee of Corporate 4 Insurance Agency v. Endurance American Specialty Insurance Inc., No. No. 12-374, D. Minn.; 2013 U.S. Dist. LEXIS 3658).

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.).

4th Circuit: Employee Failed To Prove Retaliation, Assault

RICHMOND, Va. - A Virginia federal court properly rejected a worker's lawsuit against her former employer alleging a hostile work environment, retaliatory discharge and assault and battery, the Fourth Circuit U.S. Court of Appeals ruled March 15 (Karen B. Balas v. Huntington Ingalls Industries, Inc., Successor to Northrop Grumman Corporation, No. 12-1201, 4th Cir.; 2013 U.S. App. LEXIS 5199).

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.).

New York Appeals Court Says CEO Can Be Held Liable In Benzene Pollution Case

ROCHESTER, N.Y. - A New York appeals court has affirmed a trial court's refusal to dismiss the owner and CEO of a coke manufacturer from a benzene-related lawsuit, saying in a March 15 decision that a corporate officer may be held liable if it is established that the officer was a participant in the wrongful conduct alleged (Jennifer L. Abbott, et al., v. Tonawanda Coke Corporation, et al., No. 12-01384,N.Y. Sup., App. Div., 4th Dept.; 2013 N.Y. App. Div. LEXIS 1674).

Committee: Ormet's Bidding Procedures Unfairly Benefit Stalking Horse

WILMINGTON, Del. - The Official Committee of Unsecured Creditors in the Chapter 11 bankruptcy of Ormet Corp. on March 15 filed an objection in the U.S. Bankruptcy Court for the District of Delaware contending that Ormet's bidding procedures unfairly favor the stalking horse (In Re: Ormet Corporation, No. 13-10334, Chapter 11, D. Del. Bkcy.).

Federal Judge Affirms Ruling; Debtor Must Turn Over Property To Trustees

ST. THOMAS, Virgin Islands - A federal judge in the Virgin Islands on March 14 ruled that a bankruptcy court had jurisdiction to order a debtor to turn over property to the trustees in his personal bankruptcy as well as in the corporate bankruptcy of the company he founded (In Re: Jeffrey J. Prosser, No. 06-30009, Chapter 7; In Re: Innovative Communications Corporation, No. 07-30012, Chapter 11; Stan Springel, et al. v. Jeffrey J. Prosser, et al, No. 2011-113, D. V.I., St. Thomas/St. John; 2013 U.S. Dist. LEXIS 35311).

Hawker Beechcraft Trustee Says Some Of $19.31M In Fees Are 'Unreasonable'

NEW YORK - The U.S. trustee in the Chapter 11 bankruptcy of Hawker Beechcraft Inc. on March 14 filed a brief in the U.S. Bankruptcy Court for the Southern District of New York objecting to various firms' applications for more than $19.31 million in compensation and reimbursement of expenses (In Re: Hawker Beechcraft, No. 12-11873, Chapter 11, S.D. N.Y. Bkcy.).