href='mailto:Headlines@abiworld.org?subject=Subscribe me to the ABI
Headlines Direct'>
src='/AM/Images/headlines/headline.gif'>
April 12, 2006
id='1'>Congoleum Attorneys Appeal
Disgorged Fees
Gilbert Heintz &
Randolf LLP, a former insurance counsel for Congoleum Corp., is
appealing a bankruptcy court order that voided $13 million in attorney
fees due to an alleged conflict of interest in the flooring company's
asbestos-related chapter 11 case,
size='3'>Portfolio Media reported yesterday.
Gilbert Heintz was originally hired as special insurance counsel by
Congoleum in January 2004, a month after the New Jersey-based flooring
materials business filed for bankruptcy. Last October, a federal judge
removed Gilbert Heintz from the case after accusing the firm of a
conflict of interest. Earlier in the year, Gilbert Heintz had submitted
an application seeking payment for $11.4 million in fees and $1.6
million in expenses from Congoleum. However, Judge Kathryn C. Ferguson
denied those fees after the U.S. Trustee involved in the case argued
that the firm should not be paid because it had worked on behalf of
asbestos creditors with claims against Congoleum. The trustee claimed
the firm did not disclose its involvement in arranging settlements for
as many as 10,000 claimants when it was hired.
id='2'>Commentary: How Unions Can
Remain Relevant in Face of Bankruptcy
Unions can remain
relevant during bankruptcies in a number of ways, said Cary Burnell, a
researcher with the United SteelworkersUnion, including joining the
creditor committee, constantly communicating with union members and
having a credible strike threat should the company seek to void labor
contracts, according to an op-ed piece in the
face='Times New Roman' size='3'>Kansas City Star
size='3'>yesterday. BNA Inc., a research firm based in
w:st='on'>
size='3'>Washington
w:st='on'>
size='3'>D.C.
that it is rare for a bankruptcy judge to void labor contracts. BNA
found only two occasions when a bankruptcy judge voided labor contracts
this decade. It happened in the US Airways bankruptcy in January 2005,
when the bargaining agreements of 9,000 mechanics and fleet service
workers were tossed out. The second was in the bankruptcy of Horizon
Natural Resources Co., a coal producer in
w:st='on'>
size='3'>Ashland
w:st='on'>
size='3'>Ky.
2004, a judge approved the company’s motion to void contracts
covering 800 workers and 2,300 retirees. “Despite the problems
these industries have had and the number of times airline and steel
companies have threatened to have their contracts voided, having a court
void an agreement appears to be very rare,” said Karen James-Cody,
href='http://www.ohio.com/mld/kansascity/business/14312228.htm?template=contentModules/printstory.jsp'>Read
more .
id='3'>Bankruptcy Filings
Down in
face='Times New Roman' size='3'>San Diego
size='3'>County
size='3'>
Less than 600 cases were
filed in
face='Times New Roman' size='3'>San Diego
size='3'>County
four months following the implementation of the new bankruptcy law as
people rushed to file under the old qualifications, the
face='Times New Roman' size='3'>San Diego Daily Transcript
reported yesterday. A total of 5,071 bankruptcy filings
were made in
face='Times New Roman' size='3'>San Diego
size='3'>County
October, more than five times the previous October. 'We had five months'
worth of cases filed in one month,' said John Colwell,
owner of
w:st='on'>San
Diego
Clinic. The average monthly chapter 7 filings in San Diego County so far
in 2006 is down more than 1,000 from the 1,298 a month that were filed
in 2005. A total of 925 cases a month were filed in 2004 and 971 in
2003. 'Filings are substantially down, unquestionably, but it's a little
difficult to attribute that just to the new law,' agreed
Diego
attorney Michael
O'Halloran, who represents debtors.
href='http://news.yahoo.com/s/sddt/20060412/lo_sddt/newlawsimpactbankruptcyfilingsdownbutlastminuterus'>Read
more .
id='4'>GM Looking for Buyers
for
Units
General Motors Corp.'s
top purchasing executive said the automaker is trying to help auto parts
supplier Delphi Corp. dispose of noncore businesses by finding buyers
for them and contracting with new suppliers for certain parts, the
Associated Press reported yesterday. Bo Andersson, GM's vice president
of global purchasing and supply, also confirmed that GM is
stockpiling parts in case Delphi workers strike, but he wouldn't offer
details of GM's contingency plan and said the automaker is confident it
can avoid a strike at
parts division and largest supplier. GM also is ending contracts
with
size='3'>Delphi
parts. Three weeks ago, GM stopped buying spark plugs from Delphi and
transferred its business to Denso Corp., Beru AG, NGK Spark Plugs Inc.
and Honeywell International Inc., which will make it easier for Delphi
to close a spark plug facility in Flint, Mich. GM also is in the process
of transferring its business for air inductions, a spokesman said. Next
month, a federal judge will consider
face='Times New Roman' size='3'>Delphi
size='3'>'s request to cancel its union contracts.
href='http://www.washingtonpost.com/wp-dyn/content/article/2006/04/11/AR2006041100927_pf.html'>Read
more .
id='5'>Request for Examiner Denied
In GB Holdings Bankruptcy
A bid by minority
shareholders of Carl Icahn’s GB Holdings Inc. to have an examiner
appointed in the company’s bankruptcy has been denied by a federal
bankruptcy judge,
size='3'>Portfolio Media reported yesterday.
New Jersey Bankruptcy Court Judge
size='3'>Judith H. Wizmur refused the request
made by Robino Stortini Holdings LLC, which controls about 16 percent of
the company’s shares. Robino Stortini had asked the court to allow
an examiner to scrutinize a series of deals that allowed GB Holdings to
transfer ownership of the Sands Casino Hotel to another of Icahn’s
companies, Atlantic Coast Entertainment Holdings. GB Holdings filed for
bankruptcy in September 2005 after billionaire investor Icahn, who owns
a 77.5 percent stake in GB Holding’s equity, transferred the Sands
to another of his companies, Atlantic Coast Entertainment
Holdings.
Airlines
id='6'>Delta Pilots Tap $10
Million War Chest to Fund Strike
With a strike looming
ever closer, the pilots union at bankrupt Delta Air Lines Inc. has
received final approval for a $10 million grant from the major
contingency fund this week, as the labor organization continues to
solidify its plans for a walkout,
size='3'>Portfolio Media reported yesterday.
The cash flooded in as negotiations between the union and the struggling
airline remained at a standstill, according to the executive board of
the Air Line Pilots Association (ALPA) International, which approved the
grant request. The earmarked money, from ALPA’s Major Contingency
Fund war chest, will now be used to finance a strike if the Delta
pilots’ contract is rejected in the next few days. The union
requested the money in February. “Despite the movement toward a
strike, Delta executives do have a choice: they could withdraw their
1113 motion to reject the pilots’ contract, begin meaningful
negotiations and immediately begin to restore stability to the
airline,” the union said in the statement.
id='7'>Negotiators for Delta,
Union Hold Talks
Negotiators for Delta Air Lines
Inc. and its pilots union met to try to hammer out an agreement over pay
and benefit cuts that would prevent a strike that would doom the
nation's third-largest carrier, the Associated Press reported yesterday.
Spokesmen for the company and the union declined to comment about the
closed-door talks, which were said to be intensifying as they continued
into the early evening. The talks were expected to continue into
Wednesday, the same day hundreds of Delta pilots planned to march
outside the company's headquarters to protest the No. 3 U.S. airline's
effort to void the pilot contract and impose up to $325 million in
long-term pay and benefit cuts. Any deal the sides were able to reach
would have to be ratified by the airline's 5,930 pilots. Last week, the
pilots authorized their union leader to call a strike anytime after
Monday. An arbitration panel has until Saturday to decide on the
company's contract rejection request, but that deadline could be
extended if the sides were close to an agreement.
href='http://www.washingtonpost.com/wp-dyn/content/article/2006/04/11/AR2006041101357_pf.html'>Read
more .
id='8'>Global Home Products Loses
$60.5 Million, Files Chapter 11
Rising costs and an
increase in overseas competition have driven housewares maker Global
Home Products Inc. into chapter 11 bankruptcy, the company’s Chief
Financial Officer said,
size='3'>Portfolio Media reported yesterday.
The company and three of its operating units, including glassware maker
Anchor Hocking, bakeware company WearEver, and picture frame maker the
Burnes Group, filed for bankruptcy in Delaware, listing net losses of
$60.5 million and revenue of $452.8 million for the 11 months ending
March31. The loss
caused Global Home to default on a loan from Wachovia Bank, its primary
lender. The company owes Wachovia about $115 million, and also owes
lender Madeline LLC another $200 million. The company owes unsecured
creditors about $66 million.
size='3'>Global Home’s total assets were valued at $472.5 million
at the end of February. The company, which has already secured a $65
million loan from Wachovia to continue operating, employs 1,950 people.
The case is Global Home
Products LLC, chapter 11 petition number
06-10340, in the U.S. Bankruptcy Court for the District of
Delaware.
id='9'>Bankrupt
California
HMO
Watts Health Foundation
Inc. has decided to sell its UHP Healthcare HMO for $30 million,
according to foundation officials, to a for-profit managed health
company, the Los Angeles
Times reported today. The plan's 80,000
members would keep their coverage and should see little change, they
said. Inglewood, Calif.-based Watts Health will leave the HMO business
to focus on charitable work, said Johnny Darnell Griggs, chairman of the
foundation's board of directors. The board voted Monday afternoon to
sell its HMO business, which provides medical and dental plans, to help
it emerge from bankruptcy protection, which the foundation sought last
May. The buyer is Care 1st Health Plan, an Alhambra, Calif.-based HMO.
Foundation officials and creditors said Tuesday that the sale of the
health plan was the most viable option. Under the deal, Care 1st would
pay $30 million for Watts Health's HMO contracts with members and
providers and donate $500,000 to the foundation's charitable
efforts.
href='http://www.latimes.com/business/la-fi-watts12apr12,1,6500907,print.story?coll=la-headlines-business'>Read
more .
id='10'>Adelphia Files Modified
Reorganization Plan
Adelphia Communications
Corp. announced morning that it has filed a fourth reorganization plan
with a federal bankruptcy court, according to
face='Times New Roman' size='3'>Business First of Buffalo
today. Adelphia's plan would
give creditors the option of accepting Adelphia's proposed settlement or
opting for a 'holdback' plan that postpones their claims for future
resolution, while allowing the sale to Time Warner and Comcast to
continue. Adelphia Communications Corporation is the fifth-largest cable
company in
w:st='on'>
size='3'>America
serving customers in 31 states. It agreed a year ago to sell cable
operations worth $17.6 billion to Time Warner and Comcast.
href='http://biz.yahoo.com/bizj/060412/1271773.html?.v=1&printer=1'>Read
more .
id='11'>Refco Fires Its Finance
Chief as It Winds Down Operations
Refco Inc. said it fired
its chief financial officer, Gerald M. Sherer, one of several top
executives named as defendants in a class-action lawsuit filed over the
company's collapse last year, the
size='3'>Wall Street Journal reported today.
Sherer was dismissed Friday, according to a Securities and Exchange
Commission filing in which Refco said his services no longer are needed
as the company winds down its operations. Refco is also seeking approval
from the U.S. Bankruptcy Court in
w:st='on'>
size='3'>Manhattan
its employment contract with Sherer. A hearing on Refco's request is
scheduled for April 19 in the
w:st='on'>
size='3'>Manhattan
size='3'>bankruptcy court.
href='http://online.wsj.com/article/SB114480996493223727.html?mod=home_whats_news_us'>Read
more . (Registration required)
id='12'>Ex-Hockey Star Files for
Bankruptcy
Darren McCarty, whose
rugged play as a Detroit Red Wing, charitable fund-raising and
heavy-metal musicianship made him one of the most popular professional
athletes in recent
face='Times New Roman' size='3'>Detroit
history, has filed for bankruptcy, the
face='Times New Roman' size='3'>Detroit Free Press
size='3'>reported today. In documents submitted to U.S. Bankruptcy Court
in
size='3'>Detroit
assets of $1.9 million and debts of $6.2 million -- including at least
$185,000 to casinos in
and
face='Times New Roman' size='3'>Las
Vegas. He also listed debts
to banks, credit card companies, friends, utilities, law firms, a
roofing company and the Oakland County Drain Commission. Many of his
assets are tied up in insurance polices, his NHL pension and $490,000 in
business loans he made that his court filings say are unlikely to be
repaid. Nothing indicates McCarty's troubles are tied to the McCarty
Cancer Foundation, the Oakland County-based charity he and his family
founded in honor of his father, Craig, who died from multiple myeloma in
1999. Marty Fried, McCarty's lawyer, blamed
the bankruptcy on last season's NHL lockout, a divorce that was
finalized in February 2005 and a substantially smaller contract with the
href='http://www.freep.com/apps/pbcs.dll/article?AID=/20060412/NEWS05/604120385/1007&template=printart'>Read
more .
id='13'>Skilling Denies Arranging
Secret Side Deals at Enron to Benefit Fastow
Jeffrey K. Skilling
denied on Tuesday that he ever arranged secret side deals known as 'bear
hugs' to enrich Andrew S. Fastow when Fastow was chief financial officer
of Enron, according to today’s New York
Times. 'I had no agreement with Andy Fastow
that would give him a guaranteed rate of return,' Skilling said. Fastow
testified earlier that Skilling agreed to guarantee a profit for any
assets that LJM, an off-the-books partnership, purchased from Enron.
Accusations about the secret side deals are some of the strongest
against Skilling.
href='http://www.nytimes.com/2006/04/12/business/businessspecial3/12enron.html?_r=1&oref=slogin&pagewanted=print'>Read
more .
href='http://www.nytimes.com/2006/04/12/business/businessspecial3/12enron.html?_r=1&oref=slogin&pagewanted=print'>