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November 14, 2005
id='1'>DeWine, Mikulski Clear Way for Vote on Senate Pension
Measure
Two U.S. senators cleared the way for a vote on overhauling the
U.S. pension system by lifting their objections to the legislation,
Bloomberg reported Friday. Sens. Mike DeWine (R-Ohio) and Barbara
Mikulski (D-Md.) said that they would allow the measure to proceed.
They had opposed a provision that penalized such companies as General
Motors Corp. that have junk credit status. The legislation would force
the 29,651 companies that provide 34.6 million U.S. workers
defined-benefit pensions to fully fund their plans. The Labor Department
estimates that companies underfunded their plans by $450 billion last
year.
href='http://www.bloomberg.com/apps/news?pid=10000103&sid=a4ZgqENyT_tY&refer=us#'>Read
more.
id='2'>Halliburton Violated Pension Law
An investigation by
the U.S. Labor Department found that Halliburton Co.'s pension plans
violated the law three times and the company paid more than $8.6 million
to correct the violations, the New York Times reported on Friday,
citing
correspondence from the department. The abuses included charging some
costs of the company's executive pension and bonus plans to a workers'
pension fund, the paper said, and the company was found to have violated
federal pension law prohibitions against self-dealing and using pension
money for the benefit of the company. Halliburton was required to
replenish improperly withdrawn funds, repay those individuals affected
and pay an undisclosed tax penalty.
href='http://abcnews.go.com/Business/wireStory?id=1302267'>Read
more.
id='3'>Two Families Seek Church Accountability in Abuse Cases
Sally Ellison does
not have an appointment with the leaders of the Roman Catholic Church.
She is not even a Catholic. But she is flying 900 miles from her home in
Wisconsin to Washington today for a meeting of U.S. bishops, and she
thinks they should hear what she has got to say, the Washington
Post
reported. After an unusual hearing last month, a judge in Hudson, Wis.,
ruled that a Catholic priest, the Rev. Ryan Erickson, 'probably'
murdered James Ellison, 22, and Daniel O'Connell, 39, on Feb. 5, 2002.
href='http://www.washingtonpost.com/wp-dyn/content/article/2005/11/13/AR2005111300784.html'>Read
more.
id='4'>GM's Default Swaps, Options Show Increasing Bets on
Bankruptcy
Derivatives traders
are increasing bets that General Motors Corp. (GM) may follow Delphi
Corp. and Delta Air Lines Inc. into bankruptcy after the disclosure of
accounting errors and four straight quarters of losses, Bloomberg
reported today. Traders last week demanded up-front payments in addition
to annual premiums for derivatives contracts that protect owners of the
Detroit-based company's debt should it miss a payment or declare
bankruptcy. By doing so, traders relegated GM to the same status as
Delphi and Delta just before those companies defaulted.
href='http://quote.bloomberg.com/apps/news?pid=10000103&sid=a8oF_G_3iTGs&refer=news_index#'>Read
more.
id='5'>Former Refco Chief Executive Indicted in Securities Fraud
Case
The former chief
executive of Refco Inc., one of the world's biggest commodities
brokerages, engaged in a conspiracy that caused Refco to sell $583
million in stock to the public based on 'false and fraudulent'
statements of its finances, an indictment charged Thursday, the
Associated Press reported. The indictment returned in U.S. District
Court in Manhattan accused Phillip R. Bennett and others of conspiring
to commit securities fraud when they hid from auditors and investors
losses that Refco and its customers had incurred in the financial
markets.
href='http://www.law.com/jsp/article.jsp?id=1131640499629'>Read
more.
id='6'>Mirant Parent: Out of Bankruptcy by Year’s End
Jamaica Public
Service Company (JPS) is confident that its U.S.-based parent, Mirant
Corporation, will meet its deadline and emerge from chapter 11
bankruptcy by end of 2005, the Jamaica Observer reported
yesterday. In
fact, JPS insists that Mirant will ends its bankruptcy proceedings 'as a
stronger company and a much tougher competitor in the global energy
industry.' A significant factor contributing to this positive outlook is
the U.S. energy provider's agreement with bankruptcy committees, which
will
eliminate half of the company's debts, JPS said.
href='http://www.jamaicaobserver.com/magazines/Business/html/20051112T160000-0500_92367_OBS__MIRANT_OUT_OF_BANKRUPTCY_BY_YEAR_END__.asp'>Read
more.
Airlines
id='7'>Set to Exit Bankruptcy, United Will Hire 2,000 New Flight
Attendants
United Airlines
said Friday that it plans to hire 2,000 flight attendants in the coming
year, the first time it has added to those ranks in four years, the
Associated Press reported Saturday. The announcement comes less than
three months before United, a unit of UAL Corp., plans to exit chapter
11 bankruptcy and demonstrates its intent to expand next year after a
three-year restructuring.
href='http://www.startribune.com/stories/535/5722564.html'>Read
more.
id='8'>Delta Response, Objections Filed
Delta Air Lines’
official committee of unsecured creditors filed with the
U.S. Bankruptcy Court a response in support of the company’s motion to
reject the ALPA collective bargaining agreement, Bankruptcydata.com
reported Friday. The Air Line Pilots Association International and DP3
filed separate objections to the company’s motion. The court is
scheduled to consider the motion Nov. 16, 2005.
href='http://www.bankruptcydata.com/BDR.asp?ID=2433'>Read more.
id='9'>Bankruptcy Court to Probe Bennett Trustee's Spending
U.S. Bankruptcy
Court Chief Judge Stephen D. Gerling has ordered an investigation into
whether Richard C. Breeden, the high-profile trustee who oversees the
Bennett Funding Group bankruptcy, used money from the defunct Syracuse
company for personal reasons. The investigation comes at the prodding of
Patrick R. Bennett, the company's former chief financial officer, who
was convicted in 1999 of cheating investors in the company. He is now
serving a 20-year sentence in federal prison in Loretto, Pa. Breeden
collected more than $13 million in fees for his nearly decade-long
involvement with the Bennett bankruptcy.
href='http://www.syracuse.com/business/poststandard/index.ssf?/base/business-1/113178858019220.xml&coll=1'>Read
more.
id='10'>Former TRMPAC Treasurer Files for Bankruptcy
Democrats' lone
court victory in the controversy over corporate campaign money in the
2002 elections has likely been eliminated by the personal bankruptcy of
the treasurer for U.S. Rep. Tom DeLay's (R-Tex.) political action
committee, the American-Statesman reported Saturday. Former
Dallas state
Rep. Bill Ceverha (R-Tex.), who served as campaign treasurer for Texans
for a Republican Majority, declared bankruptcy last month after a state
district judge had ruled in a civil trial that he broke state law by not
disclosing about $600,000 in corporate donations that had been spent
illegally by the group.
id='11'>Bankruptcy Fraud Charges Dismissed in Atlanta Bar Case
Barbara Archibald
smiled and squeezed her husband's hand in federal court in Brunswick,
Ga.,
Thursday, the Brunswick News reported Friday. It was a sign of
emotion after U.S. District Judge Anthony Alaimo granted a defense
motion to acquit her of all charges in the joint bankruptcy fraud trial
of her and her husband, Peter G. Archibald Jr. That leaves the fate of
Mr. Archibald, former operator of two defunct St. Simons Island
restaurants, to go to the jury next week on a question of whether or not
he undervalued the worth of an Atlanta-area nude bar on the documents.
Read
more.
id='12'>Philadelphia Mayor's Brother Files for Bankruptcy
Protection
The brother of
Philadelphia Mayor John Street has filed for chapter 7 bankruptcy
protection,
citing business debts, the Associated Press reported Friday. The
bankruptcy petition listed
Street's estimated assets at $50,000 or less and indicated that he has
$75,000 in debts. Beginning in 2001, Street was paid $360,000 a year as
a consultant by Philadelphia Airport Services. He lobbied for the firm
to get a contract at Philadelphia International Airport, and was getting
$30,000 a month from it when the city renewed its one-year contract
three times.
id='13'>Refco Winner Announced
Refco announced that Man Group has presented the winning bid for
certain company
assets and will pay $323 million in cash. Bankrupctydata.com reported
Friday. Refco employees will continue to work with customer accounts.
Liabilities will be taken over by Man Group for all of Refco’s
businesses in the United States, United Kingdom, Asia and Canada. The
transfer of the Refco open accounts is expected to be accomplished
through a bankruptcy filing that permits the court-appointed trustee to
make the transfer
seamlessly. Read
more.
id='14'>ATA Holdings Financing Agreement Approval Sought
ATA Holdings filed
with the bankruptcy court a motion to approve an
agreement in principle with private equity fund MatlinPatterson Global
Opportunities Partners II for debtor-in-possession (DIP) financing in
the
amount
of $30 million. Bankruptcydata.com reported Friday. In addition to
DIP financing, MatlinPatterson has tendered a commitment to invest up
to an additional $70 million in equity upon ATA's emergence from its
chapter 11 case. In connection with the anticipated MatlinPatterson
investment and ATA's emergence from chapter 11, ATA is also engaged in
discussions with Southwest Airlines concerning its current
codeshare agreement. Under the agreement in principle, MatlinPatterson
would
make $30 million in DIP financing available, following
final
approval by the court. ATA expects to seek final court approval of the
DIP financing on Dec. 6, 2005.
href='http://www.bankruptcydata.com/BDR.asp?ID=2268'>Read more.
id='15'>Rule Would Put Pension Deficits On the Books
The group that
writes U.S. accounting rules voted yesterday to consider changing how
pensions are treated on companies' ledgers, including a requirement that
pension-fund surpluses and deficits be recognized on balance sheets, the
Washington Post reported Friday. The Financial Accounting
Standards Board
said in a written statement that a review is needed to make information
in companies' financial statements 'more useful and transparent for
investors, creditors, employees, retirees and other users.'
href='http://www.washingtonpost.com/wp-dyn/content/article/2005/11/10/AR2005111002195.html'>Read
more.
id='16'>Bankrupt Paper Mill Rekindles Water Concerns
The battle over
whether Georgia's water will be put up for sale was rekindled in May,
when a federal bankruptcy court placed a water withdrawal permit on the
auction block, the Weekly reported Saturday. The bankruptcy court's
order came as a shock to Upper Chattahoochee Riverkeeper (URC) and other
members of the Georgia Water Coalition who had worked successfully to
defeat efforts to allow the sale of water permits in the 2003
legislative session.
href='http://www.theweekly.com/news/2005/November/12/Riverkeeper.html'>Read
more.
id='17'>Venture Funds' Executives Named as Defendants
Sports broadcasting
entrepreneur Rick Ray has opened a new front in the battle over Piedmont
Venture Partners' demise, filing an action in bankruptcy court that
names investment firm partners Stacy Anderson and Bill Neal as
defendants for the first time, the Charlotte Business Journal
reported
today. Jackson filed the adversary proceeding last week in U.S.
Bankruptcy Court in Charlotte, N.C.
href='http://www.bizjournals.com/industries/banking_financial_services/venture_capital/2005/11/14/charlotte_story5.html'>Read
more.
id='18'>COMMENTARY: The Great Global Buyout Bubble
A year ago, Henry
R. Kravis, the legendary buyout mogul who invented the modern-day
private equity industry, gave a rare speech to a group of investors in a
ballroom of the Waldorf-Astoria, recounting how difficult it had been
for him to raise $355 million to buy one of his first companies,
Houdaille Industries, in 1979, according to a report by the New York
Times. 'The availability of financing was our biggest challenge,' he
said. 'Literally, we had to add up the potential capital sources at that
time, which consisted of several banks and insurance companies, and one
by one go out and raise the money.' Today, he has the opposite problem.
Investors have been throwing money at the red-hot leveraged-buyout
industry - so much so that Mr. Kravis now has to turn away some of them,
rejecting their cash as a mere 'commodity.' Private equity firms, it
seems, now own everything: Hertz, Neiman Marcus, Metro-Goldwyn-Mayer,
Toys 'R' Us and Warner Music, to name a few. So far this year, buyout
firms have spent more than $130 billion gobbling up parts of corporate
America. And with more than another $100 billion in unspent money this
year still swirling around the industry, there is a lot more buying to
be done. The trillion-dollar question is whether these shopaholics are
setting themselves up for a giant fall. If the market begins to show
even the faintest signs of strain, this bubble may pop, say many
financial analysts.
href='http://www.nytimes.com/2005/11/13/business/yourmoney/13buyout.html'>Read
more.
id='19'>An Appeals Court Is Urged to Uphold Ebbers Conviction
Federal prosecutors
said Friday that the evidence against the former WorldCom chief
executive, Bernard J. Ebbers, was 'overwhelming' and urged a federal
appeals court to uphold his fraud conviction and 25-year prison
sentence, Bloomberg News reported. Prosecutor David B. Anders, an
assistant U.S. attorney, responding to Mr. Ebbers's request for
a new trial, said the government had proved that Mr. Ebbers knew about
and participated in an $11 billion accounting fraud at the company he
helped found. The scheme helped drive WorldCom, the No. 2 U.S.
long-distance company, into bankruptcy protection. Ebbers was convicted
in March of conspiracy, securities fraud and seven counts of making
false filings to the Securities and Exchange Commission. He is free on
bail pending the outcome of his appeal. Defense lawyers said in a brief
in September that the trial judge should have forced prosecutors to
grant immunity to former WorldCom executives, allowing them to testify
without risking criminal charges, saying that the testimony would have
cleared Ebbers.