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April 202007

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Lawyers Shifting to Online Resources under BAPCPA

Faced with more
responsibilities under the Bankruptcy Abuse Prevention and Consumer
Protection Act, lawyers are turning increasingly to online tools,
including Web sites that offer forms and other bankruptcy documents, the

Associated Press reported yesterday. 'Lawyers, in particular, are more
dependent on online tools that are made available to them to fulfill
requirements' under the law, said

size='3'>Kevin Chern, president of Start Fresh

Today Inc., which provided the online platform for the class McMahon's
client took this month. That dependence, Chern said, is likely to
increase over the next few years as the number of consumers filing for
bankruptcy protection grows. Many lawyers also are relying increasingly
on Internet mailing lists for people with shared information needs and
blogs to conduct their research. 'The greatest role technology has
played in recent months since the implementation of the new law is the
ability to share information' through e-mail lists and blogs, said
Bradford Botes, a principal of Bond & Botes PC.
href='http://www.chron.com/disp/story.mpl/ap/business/4732791.html'>Read

more.

To read about the latest
developments in bankruptcy issues, 
href='http://blogs.abiworld.org/'>click here to check out
ABI’s Bankruptcy Blog Exchange.

San
Diego Bishop Scheduled for Questioning in Bankruptcy
Proceeding

More than 140 people who claim
they were sexually abused by priests of the Roman Catholic Diocese of
San Diego will be able to ask questions of church leadership on Friday
when Bishop Robert H. Brom testifies before a meeting of the creditors'
committee in the diocese's bankruptcy proceedings, the Associated Press
reported today.
size='3'>Questions will be limited to matters directly relating to
diocesan financial records and its proposed reorganization plan, and the

bishop will not answer to the abuse allegations, said attorney
James Stang
size='3'>, who is representing the plaintiffs. Brom has not appeared in
court since the diocese filed for chapter 11 bankruptcy protection in
February, just hours before the first civil trial was slated to begin in

San Diego Superior Court. Last month, the diocese proposed a $95 million

settlement for sex-abuse victims that would pay plaintiffs between
$10,000 and $800,000 each. An additional $3 million fund
would  be established to resolve claims that
have not yet been filed. Plaintiff attorneys are seeking a settlement of

about $200 million. 
href='http://www.mercurynews.com/news/ci_5710274?nclick_check=1'>Read
more.

Subprime
Mortgages


id='3'>New Century Workers Seek to Form Committee

Employees of New Century
Financial Corp. are seeking bankruptcy court approval to form a
committee that will represent more than 570 current and former workers
who are allegedly owed $40 million for contributions they made to a
deferred compensation plan and an executive retirement plan at the
bankrupt subprime lender,
size='3'>Bankruptcy Law360 reported yesterday.

The employees are concerned that the official unsecured creditors’

committee that has been appointed by the trustee “will not
adequately represent the interests of the movants or the hundreds of
other plan beneficiaries,” the motion stated.
face='Times New Roman' size='3'>They said the unsecured creditors’

committee is “dominated by large, sophisticated financial
institutions that willingly made loans and other financial
accommodations” to New Century, and that their interests are
“vastly divergent” from those of the plan
beneficiaries. 

href='http://bankruptcy.law360.com/Secure/ViewArticle.aspx?id=23022'>Read

more. (Registration required.)


id='4'>Two Subprime Lenders Announce Job Cuts; Call Centers
Closed

General Electric’s
subprime lending unit, WMC Mortgage, closed three centers yesterday and
cut 771 jobs — about half of its remaining staff — while the

Residential Capital home-lending unit of GMAC announced it would
eliminate as many as 700 workers, or 5 percent of its American work
force, Bloomberg News reported today. WMC Mortgage said that it was
tightening lending standards and reducing loan originations in
the
face='Times New Roman' size='3'>United
States, and would

have about 700 employees in two call centers after the cuts. Centers
shut yesterday were in Cosa Mesa and
face='Times New Roman' size='3'>San Ramon
size='3'>,
size='3'>Calif., and in

size='3'>Addison,
w:st='on'>Tex.
Remaining centers are in

face='Times New Roman' size='3'>Orangeburg
size='3'>,
size='3'>N.Y., and at WMC’s
headquarters in
face='Times New Roman' size='3'>Burbank
size='3'>,
size='3'>Calif. At GMAC,
about 600 to 700 workers will lose their jobs by midyear, and at least
300 vacant positions will not be filled, a spokeswoman said, Residential

Capital, known as ResCap and based in
w:st='on'>
size='3'>Minneapolis, will
have about 12,000 employees after the reductions are made. The cuts
follow a $651 million fourth-quarter operating loss at ResCap. In the
last month, the lender has also announced the departure of its
treasurer, chief financial officer and chief executive. 

href='http://www.nytimes.com/2007/04/20/business/20lender.html?pagewanted=print'>Read

more.

Autos


id='5'>GM Says Delphi Bankruptcy Deal

Still Possible

General Motors Corp. said

that Delphi Corp., its biggest auto parts supplier, had 'ample
solutions' to emerge from bankruptcy even if the co-leader of a proposed

$3.4 billion investment quit plans to support it, Reuters reported
today. Asked if the likely withdrawal of Cerberus Capital Management LP
from a group of investors backing Delphi would jeopardise a deal to
bring
size='3'>Delphi out of bankruptcy, GM
CEO Rick Wagoner said there should be other opportunities. 'I don't
think that given the state of availability of private capital in the
U.S. today that getting other investors interested is per se a problem.
But it is going to be up to the
face='Times New Roman' size='3'>Delphi
size='3'>board to decide how they want to handle that.'

size='3'>Delphi said earlier this week

it expects Cerberus to withdraw from the proposed investment aimed at
bringing the parts maker out of its 2005 bankruptcy.


id='6'>Kerkorian, UAW Weigh Employee Ownership of
Chrysler

At least one interested
bidder for DaimlerChrysler AG's Chrysler Group as well as the United
Auto Workers union are exploring whether an employee stock-ownership
plan could be part of a deal to sell the U.S. unit, the
face='Times New Roman' size='3'>Wall Street Journal
size='3'>reported today. The investment company of billionaire Kirk
Kerkorian, which has offered to buy Chrysler for $4.5 billion in cash,
is reportedly studying employee ownership as part of its bid and is
interested in discussing the idea with the union. Separately, the union
already has begun looking into the same idea, prompted by workers at a
Chrysler plant in
face='Times New Roman' size='3'>Toledo
size='3'>,
size='3'>Ohio. The workers

have written to DaimlerChrysler Chief Executive Dieter Zetsche and have
suggested that employees could buy 70 percent of Chrysler, possibly in a

swap for cost concessions. 

href='http://online.wsj.com/article/SB117701763689076002.html?mod=us_business_whats_news'>Read

more. (Registration required.)


id='7'>Radnor Agrees to Deadline for Liquidation

U.S. Trustee
Kelly B. Stapleton
for bankrupt Radnor Holdings Corp. has dropped her bid to

convert the case to a chapter 7 liquidation, as long as the bankrupt
foam cup maker files a chapter 11 liquidation plan by the end of the
month, Bankruptcy
Law360 reported yesterday. The agreement was
approved on Wednesday by Delaware Bankruptcy Judge
face='Times New Roman' size='3'>Peter J. Walsh
size='3'>, who said an emergency conversion hearing would be held on May

10 if Radnor fails
to follow through on its deal with the trustee. Stapleton’s most
recent push for a conversion took place in March, when she filed a
motion stating there was no likelihood of rehabilitation or
reorganization for Radnor, and that it had failed to file required
operating reports. Stapleton also objected in February when Radnor filed

a motion to authorize Carroll Services LLC to provide wind-down and
liquidation services, arguing in part that the case should be
converted. 

href='http://bankruptcy.law360.com/Secure/ViewArticle.aspx?id=22990'>Read

more. (Registration required.)


id='8'>Calpine Settles Defaulted Bondholder Claims

Bankrupt energy company
Calpine Corp. said Thursday that it had reached a preliminary settlement

with a bondholder committee that will eliminate more than $8 billion in
claims, Bankruptcy
Law360 reported yesterday. If approved by the
U.S. Bankruptcy Court in
w:st='on'>
size='3'>Manhattan and a
Canadian court, the settlement would replace more than $12 billion of
claims with a single nominal claim of $3.5 billion. Additionally, the ad

hoc bondholders’ committee agreed that its actual recovery would
be no greater than the principal, accrued pre-petition and post-petition

interest, and up to $8 million in fees.
size='3'>According to a filing with the Securities and Exchange
Commission, the settlement came out of at least seven different claims
asserted against Calpine for defaulted senior notes.

href='http://bankruptcy.law360.com/Secure/ViewArticle.aspx?id=23003'>Read

more. (Registration required.)


id='9'>Cardholder Spending Pushes Up Amex's Profits

American Express Co., the

fourth-largest
w:st='on'>
size='3'>U.S.
size='3'>credit card company, said that quarterly profit rose 21
percent, helped by higher cardholder spending, Reuters reported
yesterday. Credit
losses were relatively low, with about 4.1 percent of credit card loans
on the company's balance sheet written off on an annualized basis, up
from 3.3 percent a year earlier. The New York-based company said net
income in the first quarter rose to $1.1 billion, or 87 cents a share,
from $873 million, or 69 cents a share, in the year-ago period. Credit
card issuers including JPMorgan Chase & Co. and Citigroup Inc. have
reported slightly higher first-quarter credit losses from cards, after
unusually low losses in the first quarter of 2006 following stricter
bankruptcy legislation. 

href='http://money.cnn.com/2007/04/19/news/companies/american_express.reut/index.htm?section=money_email_alerts'>Read

more.


id='10'>Former Qwest CEO Found Guilty of Insider
Trading

Joseph P. Nacchio, the
telecommunications entrepreneur whose fortune swelled with the Internet
boom, was convicted yesterday of 19 counts of insider trading for
selling more than $50 million of Qwest Communications International
stock when he knew the company's prospects were dwindling in 2001,
the Washington
Post reported today.
face='Times New Roman'>Nacchio, the former Qwest chief
executive, did not take the witness stand to testify during the trial
in
size='3'>Denver. The
conviction was the latest in a series of government victories in a drive

to police corporate malfeasance, including cases against former top
officials at Enron, WorldCom, Adelphia Communications and Tyco
International. 

href='http://www.washingtonpost.com/wp-dyn/content/article/2007/04/19/AR2007041902738_pf.html'>Read

more.

href='http://www.washingtonpost.com/wp-dyn/content/article/2007/04/19/AR2007041902738_pf.html'> 

 

 

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