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May 2, 2006
id='1'>GM to Get Breaks
on
Parts
Auto-parts supplier
Delphi Corp. has not been successful persuading General Motors Corp. to
continue paying higher prices for auto parts, according to documents
filed Monday with the Securities and Exchange Commission, the
Detroit Free Press
reported today. GM will go back to receiving price
reductions on parts it buys from the Troy, Mich.-based supplier that has
filed for bankruptcy.
size='3'>Delphi
agreement with GM, its largest customer and former owner, presents yet
another unresolved problem that the company must fix before emerging
from bankruptcy.
said in its filing that it will continue to work with its
unions and GM to reach an agreement on labor costs. 'If a company
like
size='3'>Delphi
certain price guarantee, then they probably can't cover their wage
costs,' said Robert Chiaravalli, a labor lawyer and principal at
Strategic Labor and Human Resources LLC. Chiaravalli said
size='3'>Delphi
inability to reach price agreements with GM as leverage when negotiating
with its largest labor union, the UAW.
href='http://www.freep.com/apps/pbcs.dll/article?AID=/20060502/BUSINESS01/605020320/1002/BUSINESS&template=printart'>Read
more.
w:st='on'>
size='3'>
id='2'>Ohio
75 Percent in April
Bankruptcy filings in
April for the Toledo, Ohio area were down 75 percent from a year ago and
5 percent from March as the new law continues to dissuade filers from
seeking court protection from their creditors, the
face='Times New Roman' size='3'>Toledo Blade
size='3'>reported today. There were 323 cases filed last month in the
U.S. Bankruptcy Court in
w:st='on'>
size='3'>Toledo
with 1,312 cases a year ago, when the run-up in filings began just
before BAPCPA was enacted in October. In March, there were 342 cases in
the court that covers 21 northwest
w:st='on'>
size='3'>Ohio
last month's filings, 249 were chapter 7 liquidation cases and 74 were
chapter 13 repayment plans. The chapter 13 cases are about the same number as
in most months last year, said
size='3'>Dave Fickel, clerk of the
size='3'>Toledo
court.
href='http://toledoblade.com/apps/pbcs.dll/article?AID=/20060502/BUSINESS06/605020356/-1/BUSINESS'>Read
more.
id='3'>Adelphia Creditors Seek to
Cut Off Defense Funds
Creditors of Adelphia
Communications Corp. have requested a bankruptcy court to restrict the
flow of company funds to lenders for defense expenses regarding loans to
the cable provider prior to its bankruptcy, Portfolio
Media reported yesterday. Adelphia’s
official committee of unsecured creditors estimated that
Adelphia’s lenders have already taken in approximately $100
million for indemnification claims and should not receive additional
funds, according to court documents filed Friday. Six banks claim they
are awaiting a total repayment of $6.8 billion in principal under
financial deals made before Adelphia filed for bankruptcy protection in
June 2002. In addition, the total does not include more than $1.6
billion in interest the banks have accrued while the company remains in
chapter 11, according to court documents. Creditors argued that the
banks are seeking unlimited funds to
defend against such allegations and should be entitled to no additional
funds related to those costs.
id='4'>Court OKs
size='3'>London
Borrow on DIP Loan
A federal bankruptcy judge has
approved London Fog Group Inc.’s bid to borrow on its
face='Times New Roman'>$40 million debtor-in-possession
loan as the famed rainwear manufacturer reorganizes in chapter 11
bankruptcy, Portfolio
Media reported yesterday. Late last week,
Judge Gregg W.
Zive of the U.S. Bankruptcy Court for the
District of Nevada signed off on the loan from London Fog's
pre-bankruptcy lender, Wachovia Bank. The Seattle-based company, which
plans to use the financing to run its business while it reorganizes,
already owes Wachovia $29.1 million under its pre-petition loan
agreement. Last month, London Fog sold off its popular Pacific Trail
outerwear business, acquired in the early 1990s, to Columbia Sportswear
Co. Columbia Sportswear’s $20.4 million bid beat out stalking
horse bidder Perry Ellis International Inc. just weeks after London Fog
signed an asset-purchase agreement with the Miami-based clothing
retailer for $14.5 million. London Fog’s sale of Pacific Trail
went through less than two weeks after the company filed for chapter 11
protection for the second time in less than a decade. The case is
London Fog Group
Inc., case number 06-50146-gwz, in the U.S.
Bankruptcy Court for the District of Nevada.
Refco
Judge Freezes $1.2
Billion of BAWAG Assets
A bankruptcy court judge
froze about $1.2 billion of Austrian bank BAWAG P.S.K.'s
size='3'>U.S.
size='3'>assets at the request of creditors of futures broker Refco, who
believe they are owed $1.3 billion of BAWAG assets, Reuters reported
yesterday. The judge's order modifies an existing restraining order by
naming four specific accounts that are required to keep a minimum of
$1.16 billion of assets. The prior order temporarily froze up to $1.3
billion of BAWAG assets in the
w:st='on'>
size='3'>United States
size='3'>, after creditors of Refco filed a lawsuit accusing BAWAG of
willingly conspiring in the fraud that brought about Refco's demise.
BAWAG and Refco agreed to the modified order Monday, contingent on
another agreement that was kept under seal.
href='http://money.cnn.com/2006/05/01/funds/refco_bawag.reut/index.htm?section=money_latest'>Read
more.
id='6'>LG.Philips Committee Seeks
to Limit Information Sharing
Unsecured creditors of
troubled flat-screen television producer LG.Philips Displays USA Inc.
are asking a federal judge to issue an order confirming that its members
won't have to share confidential information with the creditors they
represent, mirroring the ongoing struggle in courts nationwide to cope
with the vague provision of last October’s new bankruptcy law on
information sharing,
size='3'>Portfolio Media reported yesterday.
In court documents filed late last week, the official committee of
unsecured creditors said the public dissemination of LG.Philips’
confidential information could severely jeopardize the value of the
company’s assets, such as vendor relationship information and
intellectual property, if that information became known to the
company’s competitors. The committee also said
that certain information, such as compensation levels, is of a
“sensitive nature” and that public disclosure would cause
morale problems and potentially violate federal and state privacy laws.
A hearing on the committee’s request is scheduled for May 11. The
case is LG.Philips
Displays USA Inc., case number 06-10245-bls,
in the U.S. Bankruptcy Court for the District of
Delaware.
w:st='on'>
size='3'>
id='7'>U.S.
face='Times New Roman' size='3'> Says It Overpaid Delta for
Tickets
The
w:st='on'>
w:st='on'>U.S.
overpaid Delta Air Lines more than $26 million for tickets used by
military personnel and accused the airline of overcharging it an
additional $240,000 for tickets bought in the past three years,
the Wall Street
Journal reported today. The disclosures were
made Friday in documents filed with the U.S. Bankruptcy Court in
size='3'>Manhattan
Delta has sued to force the government to pay nearly $19 million for
flights provided mainly to U.S. Army personnel. The government, in
response, asked a judge to throw out Delta's lawsuit, saying it has the
right to deduct past overcharges and overpayments from current
obligations to Delta. The company’s quarrel with the government
stems from a probe by the Government Accountability Office, which found
that military personnel misused a fly-now-pay-later system operated by
the Department of Defense. Delta, which has been in bankruptcy
reorganization since September, has said it's transporting military
personnel at a cost of $117,000 a day without indication that it will
ever receive anything in return.
id='8'>Officials, Residents
Seek Way to Revive
w:st='on'>
size='3'>Bankrupt
face='Times New Roman' size='3'>Central
size='3'>Pennsylvania
w:st='on'>
size='3'>Hospital
Health care officials,
politicians and a few Philipsburg, Pa., residents met Monday night
to brainstorm ways to bring the bankrupt Philipsburg
size='3'>Area
face='Times New Roman' size='3'>Hospital
size='3'>back to life, the
size='3'>Centre Daily Times (
w:st='on'>
today. U.S. Rep. John Peterson, R-Pleasantville, the chief executives of
three hospitals --
size='3'>Nittany
Regional medical centers and
w:st='on'>
size='3'>Clearfield
w:st='on'>
size='3'>Hospital
and former staff members of the now-closed Philipsburg hospital came
away from the meeting with little more than hope and a go-to person. Jim
Pollock, M&T Bank vice president, said residents 'feel abandoned,'
and business and industry operators have worried about emergencies
since
face='Times New Roman' size='3'>Philipsburg
size='3'>Area
face='Times New Roman'
size='3'>Hospital
board of directors closed the hospital three weeks ago, bankrupt and $3
million to $4 million in debt.
href='http://www.twincities.com/mld/centredaily/news/local/14477344.htm?source=rss&channel=centredaily_local'>Read
more.
id='9'>Medicare Asks
size='3'>U.S.
size='3'>Elderly to Pay 11 Percent More Toward Medical
Bills
A report by the program’s
trustees said that the U.S. Medicare plan will ask elderly people to pay
11 percent more in health-insurance premiums for doctors' visits next
year, according to Bloomberg News today. Medicare intends to charge a
monthly premium of $98.20 in 2007, up from $88.50 this year, the
trustees said. The premium has more than doubled from the $45.50 charged
in 2000. Senate Democrats yesterday said they want to peg the premium
increases to the Consumer Price Index, a measure used to track economic
growth, to slow rate hikes. “Medicare premium increases are
unaffordable for many seniors as they struggle to keep up with the high
cost of prescription drugs, record gas prices and their daily
expenses,'' said Michigan's Debbie Stabenow, who sits on the Senate
Finance Committee. Medicare officials are trying to total curb total
program costs, which are forecast to more than double to $817 billion in
2015. The program cost $336.4 billion last year in expense for services
ranging from nursing-home care to a drug subsidy.
href='http://www.bloomberg.com/apps/news?pid=10000103&sid=aWkG7NytzbsY&refer=us'>Read
more.
id='10'>Pensions in
size='3'>over
face='Times New Roman'
size='3'>Church
size='3'>Exemptions
A little-known aspect of
pension law that allows churches and organizations affiliated with them
to escape the costly and complicated rules that apply to secular
employers is beginning to concern secular employees, the
face='Times New Roman' size='3'>New York Times
size='3'>reported today. Tens of thousands of people work for
organizations that have opted out of the law and most do not know that
they are exposed to potential losses with little parallel in the
corporate world. Churches can elect to abide by the law if they want,
and if they do, their employees' pensions are insured by the federal
government, just as company pensions are. However, most churches opt
out, as well as employers that are not churches themselves, but that
have some link to a religion, including hospitals, schools, nursing
homes, charities and seminaries. Every year, a few more such employers
apply to have their pension plans designated 'church plans' by the
Internal Revenue Service. Public records do not make an exact count
possible, but records at the Pension Benefit Guaranty Corporation
suggest that tens of thousands of people participate in plans that have
achieved church status and withdrawn from the pension insurance
program.
href='http://www.nytimes.com/2006/05/02/business/02church.html?_r=1&oref=slogin&pagewanted=print'>Read
more.
id='11'>Former Enron CEO to Face
Final Day of Questions
After five days on the stand,
Enron founder Kenneth Lay will face a final day of questions as the
defense team wraps up its re-direct and attempts to convince jurors that
Lay never conspired to mislead Wall Street about Enron's true financial
health, CNNMoney.com reported today. Late in the afternoon, government
prosecutor John Hueston concluded his cross-examination and painted a
picture of a man who put his own financial needs and desires ahead of
the needs of his employees. Hueston focused the jury's attention on
Lay's lavish lifestyle, which included expensive boat rides and trips to
the French Riviera, at a time when Enron was beginning to show signs of
trouble. He accused Lay of selling millions of dollars in Enron stock to
support his debt when he could have used alternate means, including his
stock holdings in other companies to pay bank margin calls.
href='http://money.cnn.com/2006/05/02/news/newsmakers/lay_enron/index.htm'>Read
more.