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Hatch Plans To Take Bankruptcy Bill 'Directly To The
Floor'
Suggesting that too many pitfalls and delays await comprehensive
bankruptcy reform legislation in committee, Senate Judiciary Chairman
Orrin Hatch (R-Utah) said on Thursday he intends to take this year's
bankruptcy bill 'directly to the floor,' CongressDaily reported.
Hatch said he was distressed that it was the Schumer provision that
ultimately had been the bill's undoing and said he intends to move this
year's version 'without attachments.' House Judiciary Chairman James
Sensenbrenner (R-Wis.) yesterday introduced last year's bankruptcy
reform conference report -- minus the Schumer-Hyde compromise language.
House Minority Leader Nancy Pelosi (D-Calif.) emphasized the need to
ensure that the Bankruptcy Code is made more lenient towards individuals
who are forced to declare bankruptcy because of crisis circumstances,
such as major illness, job loss or divorce, reported
CongressDaily.
NARAL President Blasts House Bill
NARAL Pro-choice America President Kate Michelman yesterday blasted
House Judiciary Chairman James Sensenbrenner's (R-Wis.) introduction of
bankruptcy reform legislation that omits last year's Senate-House
compromise on abortion-protest related language, CongressDaily
reported. 'Today's action by House leaders demonstrates anti-choice
lawmakers are more concerned about protecting the rights of those who
commit violence against women and doctors than protecting the
constitutional rights of the patients and people who work there,'
Michelman charged. Last year's bankruptcy conference report came under
fire by social conservatives in the House, who contended that an
amendment by Sen. Charles Schumer (D-N.Y.) would treat abortion clinic
protesters unfairly in bankruptcy court. In a related development, the
Supreme Court ruled 8-1 on Tuesday that the RICO Statute cannot be used
to punish abortion clinic protestors. To read a Wall Street
Journal commentary on the ruling, point your browser to
href='http://online.wsj.com/article/0,,SB1046310518415488383search,00.html?co…'>http://online.wsj.com/article/0,,SB1046310518415488383search,00.html?co…
day&vql_string=bankruptcy%3Cin%3E%28article%2Dbody%29
(subscription required).
Most Profitable Card Issuers
Net income from its U.S. and Canadian card businesses kept Citigroup
number one among all card issuers last year, according to the Nilson
Report. American moved up to second place from fourth the prior
year. MBNA dropped to third. U.S. Bancorp moved ahead of Sears to take
fourth place. Capital One moved up from ninth to seventh place. GE Card
Services dropped from eighth to eleventh place. Fleet and Providian
joined the top 15. Merits and Federated dropped out, reported
Nilson.
Enron Judge Says Energy Company Can't Be Named as a
Defendant
U.S. Bankruptcy Judge Arthur Gonzalez rejected a request by
shareholders suing over the collapse of Enron Corp. to name the bankrupt
energy company as a defendant in their fraud suit, Bloomberg News
reported. Enron has been shielded from litigation while it seeks to
reorganize under chapter 11 bankruptcy protection. Shareholders who also
named Citigroup Inc., J.P. Morgan Chase & Co. and other banks as
defendants in the case, are seeking to make the banks shoulder some or
all the damages a jury might assign to Enron. 'It is the court's view
that the balance of harms currently weighs in favor of the debtor,''
Gonzalez said, reported the newswire.
Laidlaw Wins U.S. Judge's Approval of Chapter 11 Recovery
Plan
Laidlaw Inc. won a U.S. judge's approval of its bankruptcy recovery
plan, clearing the way for the owner of Greyhound Lines Inc. to come out
of chapter 11, Bloomberg News reported. The Burlington, Ontario-based
company sought chapter 11 protection when losses mounted after
acquisitions, including Greyhound and Safety-Kleen Corp. Laidlaw has
been operating under bankruptcy protection in the United States and
Canada since June 2001.
Nomura May Tap Firm to Help It Become a Turnaround Artist
Nomura Securities Co. may turn to U.S. consulting firm AlixPartners LLC
for help in its bid to become a player in what could be a huge business
in devising turnaround and restructuring strategies for thousands of
moribund Japanese companies, the Wall Street Journal reported.
Nomura, Japan's biggest brokerage house, sees lucrative business from an
anticipated surge in bad-loan write-offs by Japanese banks, which in
turn presents opportunities to fix companies that have sunk so deep into
the red they are no longer able to pay back loans -- a major factor in
Japan's 12-year economic slumber. To read the full article, point your
browser to www.wsj.com (subscription
required).
Kmart Reaches Agreement With Former Executive On Subpoena
Requests
Kmart Corp. reached an agreement with a former executive who didn't
respond to several subpoena requests, dropping its request for the
bankruptcy court to find him in contempt and issue fines, Dow Jones
reported. Former Executive Vice President Anthony D'Onofrio agreed to
produce a range of documents and appear for a deposition that was
scheduled for Thursday at a law office in New York, according to court
documents made available electronically on Thursday, reported the
newswire.
Conseco Unit Keeps Chance For $845 Million DIP Loan
Replacement
Conseco Inc.'s finance unit got court authorization late Wednesday to
sign a commitment letter for an $845 million debtor-in-possession loan
from Goldman Sachs Credit Partners L.P., Dow Jones reported. If the
company were to enter into the loan, it would allow the unit, Conseco
Finance Corp., to pay off its existing DIP credit facilities with Lehman
Brothers Inc. and FPS DIP LLC, and give the unit an opportunity to
convert the replacement loan into exit financing when it reorganizes,
according to an emergency motion filed on Wednesday by Conseco's finance
arm. At a hearing later on Wednesday, Judge Carol A. Doyle of the U.S.
Bankruptcy Court in Chicago authorized Conseco Finance to enter into a
commitment letter for the loan and to pay a $5 million expense
reimbursement fee to Goldman Sachs, reported the newswire.
UAL Attorneys Billed $2.8 Million For January Chapter 11
Costs
UAL Corp.'s attorneys spent the bulk of January dealing with issues
related to the company's airline fleet and its unions, according to
court documents, Dow Jones reported. The firm Kirkland and Ellis
submitted its bill for the period to the Chicago bankruptcy court this
week, seeking compensation of $2.63 million and expense reimbursements
of $208,000. According to the documents, which were made available
electronically on Thursday, Kirkland expended a total of 8,960 hours
working on the case during the month, reported the newswire. To read the
full article, point your browser to
href='http://www.wsj.com'>www.wsj.com (subscription required).
ADELPHIA
Adelphia CEO Defends Shareholder-opposed Contract
William Schleyer, a veteran cable executive tapped by Adelphia
Communication Corp. to run the bankrupt company, said on Wednesday that
combining the posts of chief executive and chairman into one person
helps move along the restructuring process of the troubled cable
operator, Dow Jones reported. Schleyer, who started his work as CEO and
chairman at Adelphia last month, made the comment when defending in
court his company-proposed contract that is challenged by its
shareholders as 'grossly excessive,' Dow Jones reported.
Adelphia Overstated 2002 Cash Flow by $102 Million, Adviser
Says
Adelphia Communications Corp. overstated 2002 cash flow by $102 million
after improperly accounting for certain expenses, a consultant hired by
shareholders testified in bankruptcy court, Bloomberg News reported.
Cary Stanford of Saybrook Restructuring Advisors LLC said Adelphia
officials told him that the company had overstated cash flow by treating
costs to reconnect subscribers as a capital expense rather than as
operating costs, reported the newswire.
US Airways' Siegel Says Pension Testimony to End in Two Days
US Airways Group Inc. expects testimony on its bid to end a $2 billion
pilot pension plan to be finished tomorrow or March 1, Bloomberg News
reported. Chief Executive David Siegel said in an interview that he's
'very confident that we will be successful in that effort to find a
solution to the pension issue and emerge successfully' from chapter 11
bankruptcy on March 31. The Air Line Pilots Association, which is
testifying this week, wants the pension dispute resolved through
arbitration, Bloomberg reported.
PG&E Utility's Bankruptcy Trial Temporarily Halted by
Judge
PG&E Corp.'s trial on proposals to repair its bankrupt utility was
put on hold to give creditors time to examine the company's bid to use
as much as $1.2 billion to strengthen its reorganization plan, Bloomberg
News reported. U.S. Bankruptcy Judge Dennis Montali ordered the trial
suspended until at least April 8. The move delays resolution of the
bankruptcy of PG&E's Pacific Gas & Electric Co., California's
largest utility, which filed for chapter 11 protection in April 2001.
The bankruptcy cost PG&E $56 million in the fourth quarter, the
company said yesterday, reported the newswire.
NHL's Senators Open to New Bids After Bryden Loses
Exclusivity
New offers for the bankrupt Ottawa Senators National Hockey League team
will now be accepted after owner Roderick Bryden lost his exclusive
right to bid by missing deadlines, said the court-appointed monitor,
Bloomberg News reported. Bryden will be allowed to bid, said
PricewaterhouseCoopers Inc., which is running the franchise under court
appointment.
Berkshire Hathaway's $579 Million Bid for Burlington Stock
Stalled
Warren Buffett's attempt to buy bankrupt textile maker Burlington
Industries Inc. for $579 million stalled when a bankruptcy judge denied
sale procedures, jeopardizing the purchase, Bloomberg News reported.
U.S. Bankruptcy Judge Randall Newsome refused to approve a $14
million fee payable to Buffett's Berkshire Hathaway Inc. if a higher
offer was accepted. The agreement includes a clause that allows
Berkshire to back out if the fee is denied, reported the newswire.
BioTransplant Files for Chapter 11 Bankruptcy Protection
BioTransplant Inc., which licenses intellectual property rights for
developing transplant and immune-system treatments, said it filed for
chapter 11 protection to cope with the costs of a potential licensing
battle with Catholic University of Louvain, Bloomberg News reported.
BioTransplant, which filed for protection from creditors in U.S.
Bankruptcy Court in Boston, said the Belgian university has tried to
terminate a 1992 license to develop and commercialize a compound used in
an experimental psoriasis drug, which is in clinical trials, reported
the newswire.
Airlines, Worried About War, Again Seek Government Aid
The nation's beleaguered airlines, concerned about a U.S. attack on
Iraq, are in Washington this week seeking government help to soften the
impact of what could be a financial body blow, the Wall Street
Journal reported. The board of the Air Transport Association met
Thursday to explore a range of assistance proposals, such as tax relief,
government assumption of security expenses and the release of oil held
in government reserves to bring down jet-fuel prices, reported the
Journal.
Grant Geophysical Misses Payment, May File For Bankruptcy
Grant Geophysical Inc. didn't make a scheduled $2.1 million interest
payment to Elliott Associates LP on Feb. 18 and warned that it may have
to seek bankruptcy protection, according to a Form 8-K filed on Thursday
with the Securities and Exchange Commission, Dow Jones reported. Grant
Geophysical said it didn't make the payment because it has insufficient
cash on hand and a lack of funds available under its credit facility,
reported the newswire.
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