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Texas power company Energy Future Holdings Corp. will start hearings in February to confirm its chapter 11 bankruptcy exit plan and its proposed sale of its power-line business to NextEra Energy Inc. for $18.6 billion, a judge said yesterday. Those hearings had been scheduled to begin yesterday, but were postponed after the U.S. Court of Appeals for the Third Circuit ruled last month that the company owed holders of its first-lien and second-lien notes about $800 million more than anticipated. The company's plan is based on a sale of its main asset, its stake in the Texas-based Oncor power distribution business, to NextEra Energy of Juno Beach, Fla. Energy Future yesterday filed a modified plan of reorganization that essentially shifted the cost of last month's appeals court ruling to holders of junior unsecured notes by reducing their payout by roughly $800 million. Those junior creditors argued to U.S. Bankruptcy Judge Christopher Sontchi that NextEra should be on the hook for making the unanticipated payment to the first-lien and second-lien noteholders. If the Florida power company did not want to pay, then it should drop its merger plan, their lawyer argued.

A federal judge next Thursday will consider millions of dollars more in payments to attorneys and other professionals working on the bankruptcy of the Archdiocese of St. Paul and Minneapolis, MPRNews.org reported yesterday. The latest requests for fees and expenses total $4.5 million. If the requests are granted, that would bring the tab for legal and related professional service costs for the bankruptcy to about $12 million. The archdiocese filed for bankruptcy nearly two years ago. The church's most recent reorganization plan would provide $130 million in compensation to clergy abuse victims. A hearing on bankruptcy reorganization plans will be held on Dec. 15.

West Virginia regulators have settled a lawsuit brought against Alpha Natural Resources over concerns about the coal producer’s reclamation obligations as it emerges from bankruptcy, the Associated Press reported today. A Virginia court approved Alpha’s bankruptcy plan in July. But in November, Alpha revealed $100 million in unaccounted-for expenses. The West Virginia Department of Environmental Protection, worried that the burden put the company at further risk of financial failure, then filed a lawsuit against Alpha. Under the settlement announced yesterday, Alpha agreed to post its Boone County headquarters as collateral, appraised at $6.3 million. In addition, Contura Energy Inc., which bought much of Alpha’s assets, will post a $4 million letter of credit and issue a secured $4.5 million guaranty of Alpha’s obligations, each through the end of 2018.

The U.S. Department of the Interior filed an objection on Monday to the plan that Samson Resources’ creditors have proposed for the company, the Tulsa (Okla.) World reported today. The federal government’s objection was filed in respect to the disclosure statement for the joint chapter 11 plan for Samson Resources and its debtor affiliates. Among the Interior Department’s objections is the failure to disclose which wells could be abandoned under the plan and how the plan intends to address Samson’s decommissioning and environmental obligations. The plan states that Samson’s hydrocarbon interests “shall be divested, sold, or otherwise disposed of at the sole discretion of the Plan Administrator” or “abandoned on the effective date.” The Department of the Interior’s objection states that without this specific information, creditors cannot determine how their claims might be affected and lack the facts necessary to weigh the unsecured creditors’ committee’s plan against its alternatives.

“Real Housewives of New Jersey" star Teresa Giudice agreed last month to split a potential legal windfall with her creditors, but now the bankruptcy attorney whom she is suing is opposing the proposed settlement, NJ.com reported on Wednesday. Giudice filed suit against her former bankruptcy attorney James Kridel last year for legal malpractice, claiming that the Clifton lawyer's bad advice and mistakes led to her conviction for bankruptcy fraud. Giudice, who lives in Montville Township, N.J., served nearly a year in prison after taking a plea deal for bankruptcy fraud and conspiracy to commit wire and mail fraud, the latter pertaining to a mortgage scheme that predated the bankruptcy. Her husband Joe is currently serving a 41-month sentence. After she filed suit, however, John Sywilok, the trustee who represented her creditors in the bankruptcy case, successfully reopened the bankruptcy, after claiming that any money the couple won in the Kridel case should go to their creditors. After a contentious mediation, Giudice's lawyers Anthony Rainone and Carlos Cuevas eventually settled with the trustee John Sywilok, agreeing that her creditors will get 45 percent of any winnings, and that Sywilock will join Giudice's malpractice case as a plaintiff. On Tuesday, Kridel's lawyer Carl Perri filed a motion in federal bankruptcy court objecting to the settlement on the grounds that Rainone and Cuevas have a conflict of interest with Sywilok and his attorney. Read more. 

What is it like to be at the helm of a celebrity bankruptcy? Practitioners to discuss on panel at ABI’s Winter Leadership Conference.