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White House Rejects Senate GOP Offer on Bankruptcy
Bill
The Clinton Administration officially rejected on Monday the proposed
deal on the bankruptcy bill, according to Congress Daily.
The White House said the proposal falls short of the President’s
tests for a fair and balanced bill. White House National Economic
Council Adviser Gene Sperling delivered the response by phone. 'We
feel there were steps backwards on important consumer protections that
impact the overall balance of the bill,” Sperling said.
“The president continues to believe that balanced bankruptcy
reform that would meet the test of increased responsibility from both
creditors and debtors with basic fairness is in the interest of
everyone.'
The latest Senate GOP offer was criticized by bill
supporters on both sides of the aisle as being unworkable. While
Democrats saw improvements to the bill's homestead cap language, they
also noted the retention of the Fair Debt Collection Practices Act
reforms and a controversial new 'rent-to-own' provision that previously
had been rejected by Democrats. The proposal also dropped any reference
to an abortion clinic violence amendment that was backed by Democrats
and the White House.
It is not clear if Senate leaders are preparing
another proposal. Sperling indicated that the White House would
not counter with another bankruptcy offer of its own, while a Senate
Democratic leadership aide also said the minority stands 'ready to
negotiate' with Republicans. Congress is scheduled to adjourn Oct.
6.
Safelite AutoGlass Anticipates Emergence from Court
Protection
Safelite AutoGlass Corp. yesterday announced that the U.S. Bankruptcy
Judge in Wilmington, Del., has approved its financial restructuring plan
according to a newswire report. With the plan approved, Safelite
is positioned to move forward with plans to grow its share of the $3.2
billion auto glass business. The conversion of one half of the company's
long-term debt to equity has dramatically improved Safelite's financial
position. The company's financial restructuring includes the conversion
of $317 million in long-term debt to equity. Interest and principal
payments on the long-term debt will be decreased significantly, and cash
flow will increase. The Columbus, Ohio-based company expects that
the remaining conditions of the chapter 11 filing will be fulfilled
within the next several weeks, and the company will officially emerge
from bankruptcy at that time.
9th Circuit Hears Appeal of $107 Million Verdict
Against Anti-Abortion Activists
The November 1998 murder of Dr. Barnett Slepian loomed in a case
that would test the limits of the First Amendment — that case was
argued in an appeal before the 9th U.S. Circuit Court of Appeals
yesterday. In January 1999, an anonymous eight-person jury
convened and returned an astounding judgment — more than $107
million, by far the largest civil judgment ever levied against the
anti-abortion movement. The defendants were found to have violated
federal racketeering statutes and the Freedom of Access to Clinic
Entrances Act of 1994 (FACE).
The Senate version of the Bankruptcy Reform Act (S. 625) contains an
amendment that would make nondischargeable any debt arising out of
violation of Federal laws such as FACE. The so-called Schumer
amendment has been at the center of the bill’s inability to reach
the President’s desk.
A dozen anti-abortion activists and the American Coalition of Life
Activists and the Advocates for Life Ministries, two anti-abortion
groups, are appealing the verdict. Abortion providers in the Portland
area, including Planned Parenthood, accused them and Dr. Elizabeth
Newhall, of producing de facto 'hit lists' of abortion doctors.
Their web site, called the Nuremberg Files, lists the names of the
doctors, categorized three ways: practicing, injured (with names shaded
in gray) or deceased (with those names crossed out). Only one
named defendant has been convicted of abortion violence, for bombing
clinics in the mid-1980s.
Stellex Technologies Files Chapter 11
Stellex Technologies Inc. yesterday announced that it and certain of its
subsidiaries filed voluntary petitions of chapter 11 in the U.S.
Bankruptcy Court for the District of Delaware, according to a newswire
report. The filings should allow Stellex and its subsidiaries to
operate while they seek approval of a reorganization plan.
The New York–based company also announced that it has
negotiated a debtor-in-possession financing facility with a bank group
led by Societe Generale, First Union Commercial Corporation and Lehman
Commercial Paper Inc., which will provide a $36 million revolving credit
facility to Stellex. Management believes that this debtor-in-possession
(DIP) facility, together with existing cash balances and revenue
streams, should be sufficient to provide for the companies' ongoing
liquidity needs until a debt restructuring plan is approved by the
court. Stellex and its subsidiaries are leading providers of highly
engineered subsystems and components for the aerospace, defense, and
space industries.
The GNI Group Seeks Chapter 11 Protection
The GNI Group Inc. yesterday announced it and its six subsidiaries filed
voluntary petitions for chapter 11 relief in the U.S. Bankruptcy Court
for the Southern District of Texas, Houston Division. The company
also announced that it has finalized arrangements with its senior
secured lender for debtor-in-possession (DIP) financing to insure
continued operations while the company is reorganizing without
interruption. The GNI Group Inc., headquartered in Deer Park,
Texas, is engaged in hazardous and non-hazardous waste management and in
the manufacture of specialty chemicals.
Magic Kingdom Sued for Toysmart Debts
The advertising agency for Toysmart.com is suing the bankrupt toy
retailer's backer, Walt Disney, for $2.5 million, which it says owes for
media buys during the last holiday season. Arnold Communications
filed the suit last week in Superior Court in Boston. The ad agency,
based in Boston, said it spent $2.5 million on advertisements in various
media outlets, helping Toysmart become the 24th most visited site by
last Christmas.
Arnold Communications is among Toysmart's creditors and said it bent
its rules for Toysmart because of the company's well-heeled backer.
Arnold typically requires clients to pay for a media buy at least 30
days in advance of the run date, to ensure that Arnold has enough time
to cancel the buy at no cost should the client not pay. But Arnold
waived that rule for Toysmart and paid the bills because it was led to
believe that Disney would pay, the ad agency states in its complaint.
The suit, which also names four Disney officials, charges that the
defendants embarked on an expensive ad campaign at a time when they knew
Toysmart could not pay if its sales did not dramatically increase.
Florida Equipment Maker Agrees to Enter Chapter 11
Gencor Industries Inc. and its lenders reached an agreement Monday in
which the troubled manufacturer agreed to reorganize under chapter 11,
according to a newswire report. The settlement ends months of
legal wrangling during which lenders demanded that the court put Gencor
into involuntary bankruptcy because it had not paid more than $100
million in bank loans. Under the deal, Orlando-based Gencor will
repay its lenders more than $67 million by March 31, 2001, after it
sells its CPM division. The company had previously announced plans
to sell the business unit, which produces machinery used in the
production of animal feed.
Physicians Resource Disclosure Statement Hearing Deferred
Physicians Resource Group Inc. (X.PYG) will have to wait for another
month before the bankruptcy court considers approval of its disclosure
statement related to its Chapter 11 plan of liquidation. The U.S.
Bankruptcy Court in Dallas was set to consider the adequacy of the
disclosure statement at a hearing Thursday; however, counsel for the
physicians practice management company said the company requested a
two-week adjournment to allow plan negotiations to continue.
Courtesy of
href='http://www.fedfil.com/bankruptcy/developments.htm'>The Daily
Bankruptcy Review Copyright © September 13,
2000.
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