April 5, 2000
Florida's Senate Sets Deadline for Tobacco Settlement Sale
Options
On Tuesday, Florida's Senate set a three-week deadline for lawmakers
to explore ways to protect the state's $450-million-a-year tobacco
settlement from the potentially devastating effects of a Miami smokers
trial, according to Reuters. Florida lawmakers debated whether to cash
in now on future payments from a landmark 1997 settlement with the
tobacco industry as jurors in the Engle sick smokers case, a
class-action filed on behalf of thousands of smokers who say their
diseases were caused by smoking, heard closing arguments in a case that
could result in punitive damages of $300 billion or more. The potential
size of damages in the Engle case has tobacco analysts and state
officials worried that the faltering industry could slide toward
bankruptcy, cutting off the settlement cash flow to governments. 'The
long-term prospects for the tobacco companies in the United States are
not good, whether it is the Engle case or the next case,' said
State Sen. Locke Burt. Florida expects to receive between $400 million
and $500 million a year over 30 years from a landmark $13 billion
settlement reached with cigarette manufacturers in 1997 in a state
lawsuit that sought to recover the state Medicaid costs of treating sick
smokers. Florida Senate leaders said they would appoint a joint
legislative committee to study the issue by exploring options such as
buying insurance, passing legislation to insulate cigarette makers from
devastating awards, or selling off some or all of the settlement's
future proceeds at current value, and would propose their
recommendations by April 20, with a legislative proposal to be drafted
by April 24. But the idea of protecting the same industry the state had
recently sued was disturbing for some senators, who believe that the
state should act slowly. 'The Engle case is coming to a
conclusion and all of a sudden the state of Florida and other states are
now scurrying because the industry is going out to the press and state
legislators and saying, 'Folks, now you have to save us because we are
your cash cow,'' said Democratic State Senator Skip Campbell. 'I find
that to be offensive.'
Sosa Foundation Denies Fortune Magazine's Bankruptcy Report
The vice president of the Dominican Republic's Sammy Sosa
Foundation, Domingo Dauhajre, denied a Fortune magazine report
that the organization is on the verge of bankruptcy, the Associated
Press reported. 'All of this is slander against a man who has done
nothing more than help the most needy,' Dauhajre said Tuesday. 'I am
worried that this problem could affect Sosa on the playing field.'
The foundation, named after its founder, Chicago Cubs outfielder Sammy
Sosa, inoculates children, educates young mothers and provides dental
care. Fortune said it appears Sosa has given little money to the
foundation, a charge Dauhajre denied. He did not say how much Sosa has
contributed or the total assets of the foundation, but said Sosa has
donated $15,000 since January for a dental health program in his
hometown of San Pedro de Macoris. Fortune magazine also reported
that Sosa gave the foundation Plaza 30-30, a shopping complex in San
Pedro de Macoris appraised at $2.7 million that earned him a U.S.
federal tax deduction of at least $1 million, and that the building has
generated little money for the foundation because many tenants do not
pay rent. The magazine also reported that fellow baseball player Mark
McGwire has given $100,000 to the foundation, but Dauhajre said the
donation was actually made by McDonald's in McGwire's name.
CHS Electronics Files for Bankruptcy
Electronics distributor CHS Electronics Inc., Miami, said on Tuesday
it filed for chapter 11 and disclosed its plan to allow it to emerge as
an corporate incubator for Internet firms, according to Reuters. Under
its reorganization plan, creditors would receive equity and debt
securities of Europe IT ApS, a Danish corporation formed CHS' former
chief operating officer, by Mark Keough. In exchange, CHS' European
subsidiaries would be sold to Europa IT, and CHS would be released from
its obligations to creditors; the plan has been approved by Europa IT
ApS. CHS said creditors representing about $275 million in claims have
agreed to support the plan, which is subject to court approval.
Albertson's Announces Purchase of Three Tennessee Stores
Albertson's Inc., a Boise, Idaho-based retail food and drug company
that operates about 2,500 stores throughout the United States, has
purchased three stores from the bankrupt Jitney Jungle Stores of America
Inc., pursuant to the order of the U.S. Bankruptcy Court for the Eastern
District of Louisiana in which the chapter 11 cases of Jitney Jungle
Stores of America Inc., et al., are pending, according to a newswire
report. The stores, located in the greater Memphis, Tenn., metropolitan
area, will open today under the name of Seessel's, a 10-store chain.
'These stores are a great fit with our existing stores in Tennessee,'
said Peter Lynch, president and chief operating officer of Albertson's.
'We've been part of the Memphis market since 1998 when we purchased
the…Seessel's chain. This purchase creates a great opportunity for
us to fill in an existing market.'
b4bpartner Inc. Launches Legal Site for Attorney Performance
b4bpartner Inc., a Coral Gables, Fla.-based Internet software
company, announced yesterday the launch of
href='http://www.b4blaw.com/'>
color='#000000'>http://www.b4blaw.com, the first web
site that permits its members to rate an attorney's performance and
review ratings of attorneys that other members have used, according to a
newswire report. 'We are offering a service that currently doesn't exist
and which will help our members make more informed legal decisions,'
said CEO and co-founder Thomas O. Wells, a corporate/tax lawyer with
more than 11 years of legal experience, and who recently served as an
adjunct professor in the Graduate Estate Planning Program at the
University of Miami School of Law. 'Communications is the key to being
better-informed consumers of legal services. b4blaw members will be able
to gather the critical data that they need to evaluate and choose the
lawyer that would best fit their legal needs based on reading about the
real-life experiences of other members.' The free site allows users to
prepare a wide variety of legal documents using an interview-format,
then see the information automatically inserted into the document. For a
$75 fee, a member can store documents in their personal electronic safe
deposit box located online at the b4blaw site, and securely share and
deliver those documents to third parties. Members can also receive and
access faxes from their box. The password-protected box is accessible by
the member from any computer without plug-in software. 'Our members need
documentation to protect themselves and their businesses but often do
not have time to visit an attorney,' said Wells. 'Through our site,
small business owners can obtain a human resource manual for their
business, do estate planning for their family and learn how to collect
on a receivable in bankruptcy within 30 minutes.' The site has four
legal departments: Start-Up and Small Business, Estate Planning, Real
Estate and Bankruptcy/Collections.
Treasury Department's New Coalition Applauded by American Savings
Education Council
During his keynote address at the Choose to Save® Forum on
Retirement Security and Personal Savings (see
href='http://www.choosetosave.org/'>http://www.choosetosave.org)
on Tuesday, Secretary of the Treasury Lawrence H. Summers announced the
formation of the National Partners for Financial Empowerment (NPFE), a
forum for private-sector organizations and companies to come together
with federal participation to encourage Americans to save for their
future and take control of their personal finances, according to a
newswire report. The American Savings Education Council (ASEC), a
coalition of public- and private-sector organizations that undertakes
initiatives to raise public awareness about what is needed to ensure
long-term financial independence, said that it fully supports and
endorses the U.S. Department of the Treasury's efforts to educate
Americans about the importance of saving and retirement planning. 'Since
the White House/Congressional National Summit on savings education in
1998, ASEC and its partner institutions have participated in numerous
local, state and national-level efforts to increase public awareness
about the need to save,'' said Don Blandin, president of ASEC. 'We
highly commend Secretary Summer's leadership in helping further our
common mission of educating the nation about the importance of taking
control of their finances.' Secretary Summer's remarks are to be made
during this week's Emmy-award winning Choose to Save® (CTS) program
forum, a by-invitation forum of key representatives in the private,
public and non-profit sectors who will be asked to share their expertise
and best practices for encouraging long-term, routine planning, saving,
and investing for retirement by individuals. The goal of the Forum is to
help the nation develop an action plan for institutions in selected
sectors to help individuals achieve economic security. Now in its third
year, CTS was test-piloted in the Washington metropolitan area and is to
expand to the national level. 'NPFE consideration will be given to
national airing of the Choose to Save® public service announcements
and specials,' said ASEC Chairman Dallas L. Salisbury. 'A major purpose
of the NPFE effort will be to take proven local initiatives to a
national audience.'
Bankruptcy Court Orders PHS Facilities
Auction
Primary Health Systems Inc., Cleveland,
Ohio, today announced that the U.S. Bankruptcy Court for the District of
Delaware has ordered the solicitation of additional bids to purchase the
three medical facilities that PHS proposed to sell to the Cleveland
Clinic Foundation: the Integrated Medical Campus in Beachwood, Ohio, St.
Michael Hospital in Cleveland and Mt. Sinai-East in Richmond Heights,
Ohio, according to a newswire report. On Friday, the court selected a
public auction, one of two options offered in a motion by PHS, and
ordered auction procedures different from those specified in the
agreement between PHS and the Cleveland Clinic. The highest price
available for these assets will be presented to the court for its
review. Anyone interested in purchasing any of these assets should
contact William Kosturos of Arthur Andersen LLP at (216)
421-5636.
Hilco Trading, Great American Group End Exclusive Joint
Venture
Retail liquidators Hilco Trading Co. Inc. and Great American Group
announced they are ending their exclusive joint venture partnership for
liquidations as of Aug. 28, according to a newswire report. Hilco said
it will pursue several retail liquidation business areas such as real
estate services, debt financing, machinery and equipment disposition,
but that it will continue its relationship with Great American Group in
their jointly owned inventory appraisal business, Hilco/Great American
Appraisal and Valuation Services LLC.
Court Confirms ATC Group's Chapter 11 Plan
On Mar. 31, ATC Group Services Inc. won confirmation of its joint
consolidated chapter 11 plan of reorganization. Judge Jeffry H.
Gallet of the U.S. Bankruptcy Court in Manhattan approved the
Manhattan-based environmental, engineering and business consulting
firm's chapter 11 plan through the Bankruptcy Code's Section 1129(b)
'cram down' provisions. Judge Gallet was required to use the cram down
provisions because three impaired classes of shareholder claims and
common and preferred shareholder interests, each which won't receive any
property under the plan, were presumed to reject the plan.
Courtesy
of
href='http://www.fedfil.com/bankruptcy/developments.htm'>The
Daily Bankruptcy Review Copyright © April
5, 2000.
