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December 13, 2005
name='1'>Bankruptcy
Courts Have Busy Year
The dropoff in
consumer bankruptcy
petitions since the nation’s bankruptcy law changed belies the
fact that there
are still many Americans in serious financial trouble, the Associated
Press
reported yesterday. Bankruptcy filings peaked at a record of more than
315,000
a week before the law took effect Oct. 17 but have since fallen to a
weekly
rate of about 3,500, according to Lundquist Consulting Inc., a
financial information
and consulting firm based in Burlingame, Calif. "As far as
what’s happening
in the (bankruptcy) courts, it’s like the snake that swallowed
the rat,"
said Texas attorney John Penn, who is president of
the American
Bankruptcy Institute in Alexandria, Va. "It’s going to take
a while to
digest, but the system will go on."
href='http://www.chron.com/disp/story.mpl/ap/business/3522583.html'>Read
more.
id='2'>NYSE
Dismissed as Defendant in Major Pension Funds’ Fraud Suit
The New York Stock
Exchange
(NYSE) was dismissed as a defendant yesterday in three lawsuits
accusing seven
trading firms and the NYSE of fraudulently costing the nation’s
largest public
pension funds millions of dollars a year, the Associated Press
reported today.
U.S. District Judge Robert W. Sweet said he relied on reasoning in an
earlier
securities case in concluding the NYSE was entitled to the same
immunity enjoyed
by the Securities and Exchange Commission when it was performing
duties assigned
by the SEC. Sweet ruled in lawsuits brought on behalf of plaintiffs
led by the
California Public Employees’ Retirement System and Empire
Programs Inc., a Saddle
River, N.J., corporation. CalPERS is the nation’s largest public
employee retirement
system with over $166 billion in assets and nearly 1.4 million
beneficiaries.
Read
more.
id='3'>Shares
Rally on Fed’s Hint of an End to Rate Increases
The fourth-quarter
stock
rally got a jump-start yesterday after the Federal Reserve signaled it
might
stop raising interest rates soon, Bloomberg News reported today. Fed
policy
makers dropped a reference to "accommodation" in a statement
that
followed the 13th consecutive increase in their target rate, to 4.25
percent.
The change suggests that central bankers see rates as high enough to
avoid spurring
inflation. "Boy, we’ve been waiting for this," said
Larry Peruzzi,
senior equity trader at the Boston Company Asset Management. "The
feeling
is that the market does not need further rate hikes and that the Fed
will react
accordingly." The Standard & Poor’s 500-stock index
rallied 7 points,
or 0.6 percent, to 1,267.43. The Dow Jones industrial average added
55.95 points,
or 0.5 percent, to 10,823.72. Technology stocks held back the Nasdaq
composite
index, which rose 4.05 points, or 0.2 percent, to 2,265.
href='http://www.nytimes.com/2005/12/14/business/14stox.html?emc=eta1'>Read
more.
id='4'>Enron
Decision Issued
The U.S. Bankruptcy
Court
rendered a final judgment in favor of the official employment-related
issues
committee of Enron Corp. against former Enron executives to recover
approximately
$20 million in preferential and fraudulently conveyed bonus payments
made to
Enron executives in the months immediately preceding Enron’s
bankruptcy filing,
BankruptcyData.com reported today. Mark Maney of McClain Leppert &
Maney,
lead trial counsel, said, "This is a complete vindication of the
Employee
Committee’s claims that there was actual fraud in Enron’s
attempts to reward
favored employees and executives on the eve of bankruptcy." This
judgment
is in addition to the approximate sum of $50 million already recovered
by the
employee committee through negotiation and litigation. These funds are
specifically
earmarked for those 4,500 employees who were fired without severance
at the
time of the Enron’s filing of its chapter 11 case or immediately
thereafter.
id='5'>Creditors
Push Winn-Dixie to Resolve Bankruptcy
The creditors of
Winn-Dixie
Stores want the grocery chain’s bankruptcy case to be resolved
sooner rather
than later, shows an objection filed Monday by the unsecured creditors
committee,
the South Florida Business Journal reported today. Winn-Dixie
is seeking
a 90-day extension, which pushes the deadline to file a reorganization
plan
to March 20, 2006, with an approval deadline of May 22, 2006. The
creditor’s
objection, filed by creditor’s committee counsel John
MacDonald
of Akerman Senterfitt’s Jacksonville office, is limited in that
the case’s creditors’
committee does not object to an extension entirely. The objection is
to the
length of the extension Winn-Dixie requested.
href='http://southflorida.bizjournals.com/southflorida/stories/2005/12/12/dai…'>Read
more.
id='6'>Judge
OKs Met Mortgage Deal
Attorneys for
Spokane, Wash.-based,
bankrupt Metropolitan Mortgage and one of its estranged subsidiaries
have agreed
on how to resolve the subsidiary’s objections to Met’s
proposed reorganization
plan, the Seattle Times reported today. If all the steps
click into
place, thousands of stranded Met investors could see their first
recovery checks
within the next two or three months. Yesterday, a federal bankruptcy
judge in
Spokane, where the collapsed financial conglomerate is based, approved
the deal
involving Met, sister firm Summit Securities, and Met subsidiary
Western United
Life Assurance. Two weeks ago, Western filed a formal objection to Met
and Summit’s
joint bankruptcy plan, under which investors holding $470 million of
near-worthless
notes could receive 15 to 19 cents on the dollar.
href='http://seattletimes.nwsource.com/html/businesstechnology/2002682352_met…'>Read
more.
id='7'>N.Y.
Gallery Files for Chapter 11
On Dec. 8,
Berry-Hill Galleries
Inc. filed for chapter 11 bankruptcy in the U.S. Bankruptcy Court for
the Southern
District of New York, listing over 100 creditors, assets of $50-$100
million,
and debts of $10-$50 million, the Maine Antique Digest
reported yesterday.
The largest creditor named is Christie’s with a claim of
$14,016,000. At the
same time, Coram Capital, the "shell" company Berry-Hill is
accused
of setting up to conceal assets from ACG, also declared chapter 11
bankruptcy.
href='http://www.maineantiquedigest.com/articles/jan06/berryhill0106.htm'>Read
more.
id='8'>Collins
& Aikman Facility Closure Announced
Collins &
Aikman announced
its plans to close its Premier Tooling operation in Sterling Heights,
Mich.,
by March 31, 2006, BankruptcyData.com reported today. The facility
currently
has approximately 140 employees who fabricate tooling for molded
plastic products
in support of future programs. The company intends to complete
existing fabrication
work at the facility with employment levels expected to balance-out
during the
first quarter. Collins & Aikman will transfer equipment to its
facilities
in New Hampshire and North Carolina, where it will continue to
fabricate tooling
to support its proprietary manufacturing processes in plastics skins,
soft trim
and flooring. The company will utilize existing suppliers to build
plastic injection
molds, fixtures and gages for future programs.
Airlines
id='9'>Independence
Air to Cut Flights Again
FLYi Inc.’s
Independence
Air, which sought bankruptcy-court protection Nov. 7, said it will
shrink its
already-reduced flight schedule Jan. 5 to save money, the Wall
Street Journal
reported today. The Dulles, Va., company told employees yesterday that
it will
trim its daily flights to a maximum of 170 from 220, and will drop
service to
Chicago, Jacksonville, Fla., Buffalo, N.Y., and Manchester, N.H., from
its base
at Washington’s Dulles International Airport. A spokesman
declined to comment
on whether the schedule change will result in layoffs. The U.S.
Bankruptcy Court
in Delaware, which is hearing the airline’s chapter 11 case,
last month approved
bidding procedures for the airline and its assets, with final bids due
on Friday.
FLYi said it has received multiple expressions of interest, including
proposals
to acquire it, to invest in the company, and to buy specific assets.
Without
an equity investment or sale of the company, FLYi will be forced to
shut down.
id='10'>Delta
Girds for Showdown on Retiree-Benefit Cuts
A new round of wage
givebacks
tentatively agreed to by pilots at Delta Air Lines frees the carrier
to focus
on a looming showdown over benefit cuts for retirees and other efforts
to streamline
its operations while under bankruptcy-court protection, the Wall
Street
Journal reported yesterday. The Air Line Pilots Association said
6,100
pilots at Delta will begin voting soon on Sunday’s agreement to
cut their wages
by 14 percent as part of interim concessions valued at $143 million to
$150
million. If pilots approve the deal, the two sides would have until
March 1
to reach a permanent agreement, and an outside panel would decide
whether to
let Delta walk away from its pilot contract if the March deadline
isn’t met.
href='http://online.wsj.com/article/SB113443821226220819-email.html'>Read
more.
id='11'>MCA
Tries to Save Photo Caught in Bankruptcy
Robert Fitzpatrick,
director
of Chicago’s Museum of Contemporary Art, was in New York City
early last month
poking about in the ruins of the fourth-largest bankruptcy in U.S.
history —
that of the commodities and futures brokerage Refco Inc.,
Knight-Ridder News
Services reported yesterday. But unlike the creditors and claimants
clamoring
for sales of Refco’s remaining assets, Fitzpatrick was trying to
save just one
photographic print from the discard pile. The print is one of six of
Andreas
Gursky’s "Avenue of the Americas" in a super-scale
format, but only
one of the 440 works in Refco’s stellar contemporary photography
collection.
The collection is divided between Refco offices in lower Manhattan and
the West
Loop of Chicago, the city where the firm was founded in 1969.
href='http://www.fortwayne.com/mld/newssentinel/living/13398934.htm'>Read
more.