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Clinton Threatens to Veto Bankruptcy Bill
President Clinton, who supports rewriting the bankruptcy laws in
general, is threatening to veto pending legislation he contends is
unfair to ordinary debtors, according to the Associated Press. In a
letter to congressional leaders Friday, Clinton said he objected to
provisions that would limit the amount of money some bankrupt consumers
could keep in their retirement accounts and allow debt collectors to
charge people high fees if they failed to make good on bounced checks
within a month, and called the bill 'so one-sided' toward creditors that
he would veto it. 'We...must ensure that a reasonable fresh start is
available for those who turn to bankruptcy as a last resort when facing
divorce, unemployment, illness and uninsured medical expenses,' the
president wrote. At the same time, he said, he recognized the need to
reduce abuses of the bankruptcy court system by a few debtors, including
some wealthy individuals.
Clinton also said he was disturbed by the absence in the House bill
of a Senate provision that would prohibit people found to have violated
laws protecting abortion clinics from using bankruptcy proceedings to
escape fines and civil judgments, and expressed his concern that the
legislation doesn't crack down on wealthy debtors who use homestead
exemptions in some states to shield their assets from creditors in
bankruptcy proceedings. Sen. Charles Grassley (R-Iowa), a chief sponsor
of the bill, criticized Clinton's letter, deeming it 'an 11th-hour
message' that undermines Democratic lawmakers who have been negotiating
with the GOP majority over the bill. 'Together we have achieved a
balanced bill that strengthens the saftey net for those who need a fresh
start and closes the loopholes that let big spenders walk away from
debts they could repay,' said Grassley. The legislation has raised
protests from consumer advocates, unions, women's groups and religious
leaders.
Tobacco CEOs to Testify in Florida
In an effort to deter a Florida jury from punishing their companies to
the brink of bankruptcy, tobacco industry leaders are expected to
testify this week about what they see as 'enormous changes' made in
their industry in recent years, according to the Associated Press. The
Miami panel was scheduled to hear testimony today from Philip Morris
Inc. CEO Michael Szymanczyk, the first of five executives expected to
take the stand on a potential multibillion-dollar punitive damage
request by 300,000 to 500,000 sick Florida smokers. 'We're going to
present substantial evidence to show some enormous changes in these
companies in the last three years,' said lead tobacco attorney Dan Webb.
'We're going to show the jury why it is that punitive damages simply
would not be warranted in this case.' The six-member jury previously
awarded $12.7 million in compensatory damages to three people in the
nation's first smokers' class-action suit to go on trial, but the
punitive damages could reach several billion, and smokers' witnesses
have estimated that the companies could raise $150-$157 billion in
punitive damages. The other CEOs set to testify are Andrew Schindler of
R.J. Reynolds Tobacco Co., Nicholas Brookes of Brown and Williamson
Tobacco Corp., Martin Orlowsky of Lorillard Tobacco Co. and Bennett
LeBow of Ligget Group Inc. During the trial, smokers called nine
witnesses, mostly public-health experts, who contend the industry has
not changed its ways following decades of misconduct.
40 Wisconsin Nursing Homes Are Bankrupt
Nearly one-tenth of Wisconsin nursing homes are currently in bankruptcy,
according to a report by the Associated Press. Some nursing homes that
have sought chapter 11 protection are still operating while they put
their finances in order. Read the full text
HREF='http://www.gazetteextra.com/nurshome060800.html'
TARGET='window2'>here.
Kaiser Group International Files for Chapter 11
Kaiser Group International Inc. and 38 affiliates filed chapter 11
petitions late Friday in the U.S. Bankruptcy Court in the District of
Delaware, according to a newswire report. The Fairfax, Va., company said
on Friday that it has finalized plans to sell two engineering units for
about $40 million in cash, and that it expects to complete those sales
through the chapter 11 process. A spokesperson for Kaiser said a
bankruptcy filing is the 'quickest and most efficient means to complete
both sales transactions and the related restructuring of Kaiser's
existing indebtness.' Kaiser also said it hopes to complete the sales
before the end of July and to complete its reorganization by late
summer. In its chapter 11 petition, the company listed $82.4 million in
assets and $146.9 million in liabilities. The company reported in late
March that it couldn't meet its March 31 deadline for filing its annual
report because it was trying to resolve financial complications from
cost overturns in 1998.
Saftey-Kleen Seeks Bankruptcy Protection
Safety-Kleen Corp. and 73 of its domestic units filed voluntarily
petitions seeking bankruptcy protection, according to a newswire report.
The waste management company said Friday that the filing comes 'with the
support and cooperation' of senior secured lenders holding claims that
total more than $1.6 billion. The Columbia, S.C., company's shares
closed Friday unchanged at 62 cents after reaching its 52-week low of 56
cents earlier in the day. Safety-Kleen said it is finalizing
arrangements for the initial debtor-in-possession financing to support
the company's reorganization plan.
Safelite Glass Corp. Files for Chapter 11
Safelite Glass Corp. announced Friday that as part of a pre-negotiated
plan to restructure its debt, it has filed for chapter 11, according to
a newswire report. The company's filing is part of its efforts to
reorganize its capital structure and preserve the value of its
creditors. 'By going to the court with a pre-negotiated plan, we will be
able to move more quickly through the legal process,' said John Barlow,
Safelite president and chief executive officer. We expect to emerge from
the process in September as a stronger company.' The company said it has
taken all actions required to gain immediate court approval to permit
the continuation of all Safelite associate compensation and benefit
plans. The Columbus, Ohio, company has also ensured its ability to pay
independent auto glass shops. The company has also negotiated credit
facilities to assist in funding operations during the court process.
Fruit Of The Loom Wants
To Examine Farley Regarding Donations
Fruit of the Loom Inc. (FTLAQ) wants to investigate whether former
chairman and chief executive William Farley in the five years preceding
its chapter 11 bankruptcy filing may have directed the company to make
contributions to charitable organizations to satisfy his, or his family
members', personal obligations under pledge agreements. The apparel
maker is seeking bankruptcy court authorization to conduct discovery
under Bankruptcy Rule 2004 of 13 charitable organizations that
benefited from Farley's generosity, according to a recently obtained
motion.
Courtesy
of
href='http://www.fedfil.com/bankruptcy/developments.htm'>The Daily
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Review Copyright © June 12,
2000.
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