September 10
House Judiciary Committee Approves New Judgeships, But Not for
Bankruptcy Courts
The House Judiciary Committee yesterday approved a Senate bill that
would create new federal judgeships, but not before stripping out
provisions for dozens of new federal bankruptcy judges, CQ
Today reported. The committee approved the legislation (S. 878)
by voice vote. The Senate had passed it by voice vote in May 2003. The
committee adopted by voice vote an amendment by Lamar Smith (R-Texas),
that dropped the new bankruptcy judges and added some new district court
seats.
A long-stalled measure to overhaul the federal Bankruptcy Code that
also calls for new federal bankruptcy judges is stalled in the Senate
because of a dispute over whether it should include a provision aimed at
preventing anti-abortion rights protesters from filing for bankruptcy to
escape civil fines and judgments. Sensenbrenner (R-Wis.) has resisted
attempts to split off pieces of his larger bankruptcy bill. The House
passed its latest version of that legislation (H.R. 975), without the
protester provision, in March 2003. In January, the House passed a
Senate bill (S. 1920) designed to temporarily extend bankruptcy
protection for farmers under chapter 12 of the Bankruptcy Code, after
substituting the text of Sensenbrenner’s bill in an effort to spur
Senate action.
Global Crossing Shares Rise Ahead of Deadline
Shares of Global Crossing Ltd. rose nearly 4 percent yesterday, a day
before a key deadline for the global telecommunications company to file
financial results, Reuters reported. Global Crossing, which emerged from
bankruptcy protection last December, has yet to file financial results
from the past two quarters, after uncovering the accounting problem in
April, and has not provided an update on its outlook since March. Global
Crossing said at the end of July that it had found $66 million in
accounting errors, but that it needed more time to finish its
review.
Monsanto Raises 2004 Forecasts
Monsanto Co. yesterday raised its forecasts for the year for free
cash flow and earnings per share, thanks to restructuring moves by the
agricultural biotechnology company, Reuters reported. Monsanto increased
its free cash flow forecast to more than $900 million from about $500
million for the fiscal year ending Aug. 31, attributing the fresh
outlook to working capital improvements. Free cash flow is the amount of
cash remaining after a company has paid all of its expenses. Monsanto
also said lower-than-expected restructuring charges led it to raise its
forecast for earnings per share to a range of 91 cents to 96 cents for
the year, up from its previous range of 79 cents to 84 cents, the
newswire reported.
Frank’s Nursery Files for Bankruptcy, to Close All Stores
Frank’s Nursery has filed for bankruptcy and will close all of
its stores, company officials said, the Hollandsentinel.net reported. In
a filing with the U.S. Bankruptcy Court in New York, Frank’s
officials said the company “intends to use the chapter 11 process
to conduct going-out-of-business sales at each of its retail locations
and maximize the value of its salable assets.”
Judge OKs Bonuses for Owens Corning Executives
Owens Corning was well within its rights to offer bonuses to its top
executives to keep them from leaving the bankrupt corporation, a judge
said Wednesday, the Associated Press reported. Creditors had challenged
the proposed $2.3 million payout by the Ohio-based company, which was
granted bankruptcy protection in 2000 as it struggled with asbestos
litigation costs. Read the article at
href='http://www.law.com/jsp/article.jsp?id=1094073269331'>http://www.law.com/jsp/article.jsp?id=1094073269331.
US Airways Seen as Likely to Declare Bankruptcy
Barring a last-minute change in its unions’ position, US
Airways appears all but certain to seek bankruptcy protection on Sunday,
people briefed on the situation said yesterday, the New York
Times reported. In that event, the airline is considering a
bankruptcy filing without debtor-in-possession financing. Instead, it
would rely on cash on hand to finance its operations and would explore
whether it needed additional financing in the future, these people
said.
Christopher L. Chiames, the airline’s senior vice president for
corporate affairs, declined to say yesterday whether a bankruptcy
filing, which would be the airline’s second in two years, was
imminent. “All along in this process, we’ve acknowledged
that a bankruptcy filing might be necessary, but no decisions have been
made,” he said, the newspaper reported.
Exodus of Delta Pilots Could Trigger Filing
Delta senior pilots are compounding the financial woes facing the
carrier, which has been affected by high fuel prices and strong
competition from low-fare carriers in recent months, the Wall
Street Journal reported. A sudden surge in early
retirements—not sinking fares or its cost structure—could
provide the trigger for a filing in federal bankruptcy court by the air
carrier, the online newspaper reported.
Separately, Reuters reported that Delta today said it hit another
bump in its effort to avoid bankruptcy as bond holders refused to give
it permission to buy back certain debt it needs restructured, sending
its shares down about 3 percent.
Judge Dismisses Liberate Tech’s Chapter 11 Case
OpenTV Corp. said today it remains interested in pursuing a
transaction with Liberate Technologies, a software provider whose
bankruptcy case was dismissed this week by a California court, the
online Wall Street Journal reported. With the dismissal of
the bankruptcy case, OpenTV, an interactive television company, also
expects to continue a patent infringement case against Liberate
Technologies, according to a filing with the Securities and Exchange
Commission.
Trico Marine to File for Bankruptcy
Trico Marine Services Inc., which provides marine support services to
the oil and gas industry, today said it plans to file for chapter 11
bankruptcy, Reuters reported. The company, whose subsidiaries Trico
Marine Assets and Trico Marine Operators Inc. will also submit chapter
11 filings, said more than two-thirds of its senior note holders have
agreed to support its restructuring.