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Bankruptcy Judge Stuart Bernstein yesterday denied Vivint Solar Inc.'s request to advance its lawsuit against bankrupt renewable energy developer SunEdison Inc. stemming from a failed merger, Reuters reported. Vivint filed a lawsuit earlier this year against SunEdison in Delaware Chancery Court after Vivint terminated its planned $2.2 billion merger with SunEdison. The lawsuit was automatically put on hold when SunEdison filed for bankruptcy protection in April. Vivint asked Judge Bernstein to allow the lawsuit to move forward so it could secure a judgment against SunEdison. Vivint has said in court papers that its claim against the bankrupt company is approximately $1 billion in damages.

U.S. coal miner Arch Coal has agreed to set aside collateral to cover future mine cleanup costs as part of its bankruptcy reorganization plan, according to a court filing, ending its controversial use of "self-bonds,” Reuters reported yesterday. For decades the largest U.S. coal companies have used a federal subsidy known as "self-bonding," which exempts companies from posting bonds or other securities to cover the cost of returning mined land to its natural state, as required by law. Arch had $485.5 million in self-bonds in Wyoming when it filed for bankruptcy protection in January, saddled with $6 billion of debt and a deep slump in the coal sector. Under a reorganization plan set for a confirmation trial today in U.S. Bankruptcy Court in St. Louis, Arch must replace all of its self-bonds within 15 days of its bankruptcy exit plan becoming effective, a court filing by the company showed on Sunday.

Teen clothing retailer Aeropostale Inc. won court permission to sell its assets to buyers led by Simon Property Group Inc. and General Growth Properties Inc. after the landlords banded together with liquidators to save jobs and stores — a novel approach that lawyers said could be a model for distressed retailers, Bloomberg News reported yesterday. The group prevailed at a Sept. 2 auction with a $243 million bid and a plan to keep open at least 229 stores. Bankruptcy Judge Sean Lane approved the sale yesterday after being told by the retailer’s lawyers that the arrangement would save at least 7,000 jobs. “This could be a model for future restructurings in the years ahead,” Ray Schrock, a lawyer for Aeropostale, told Lane. Read more. 

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The judge overseeing Aubrey McClendon's estate approved a land deal on Friday that will pay off one of the late energy magnate's major creditors, paving the way for the sale of his stake in professional basketball team the Oklahoma City Thunder, Reuters reported. In probate court in Oklahoma City, Judge Richard Kirby approved Jones Energy Inc.'s plan to purchase 18,000 acres of oil and gas leasehold interests for $136.5 million from the estate. The proceeds from the sale will repay private equity firm Oaktree Capital Group LLC, to whom McClendon owes $85 million, court records show. Once the sale closes, Oaktree will release its claim on the cash distributions McClendon was entitled to receive from his approximately 20 percent stake in the Thunder. Lenders to McClendon have claimed in court that the oilman, who co-founded Chesapeake Energy Corp, left behind more debt than his assets could repay as oil prices cratered, an assertion that McClendon's attorneys have disputed.

The mediator trying to resolve the $18 billion bankruptcy of Caesars Entertainment Operating Co Inc. (CEOC) abruptly stepped down on Friday, Reuters reported. CEOC filed for bankruptcy in January 2015 amid creditor accusations that its parent Caesars Entertainment Corp. and private equity sponsors Apollo Global Management LLC and TPG Capital had stripped it of its best assets. Retired U.S. Judge Joseph Farnan was tasked in March to help the feuding parties reach a settlement and lift CEOC out of bankruptcy. "I'm convinced that I can't continue and possibly a new mediator will be able to establish a workable process," Farnan said in a letter published in a filing with the U.S. Bankruptcy court in Chicago. It was not immediately clear who, if anyone, would take over his role. Read more. 

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Hanjin Shipping Co. won court protection for its ships bound for the U.S., allowing the company to unload four vessels without fear of having them seized by creditors, Bloomberg News reported on Friday. Bankruptcy Judge John K. Sherwood on Friday granted the Seoul-based company protection under chapter 15 of the Bankruptcy Code. Judge Sherwood had given the company provisional protection on Sept. 6. His ruling Friday broadened that legal shield and extended its length. The decision by the court in Newark, New Jersey, will allow goods on at least four ships to come into port in the U.S. Worldwide, an estimated $14 billion worth of goods has been stuck on Hanjin ships, which ferry goods for companies including Nike Inc. and Hugo Boss AG.

SandRidge Energy Inc. won court approval for a plan to exit bankruptcy on Friday, overcoming opposition from shareholders who had accused the oil and gas producer of misrepresenting its value, Reuters reported. Bankruptcy Judge David Jones said that he read every letter he received from individual shareholders, some of whom lost their entire savings, when SandRidge filed a prepackaged bankruptcy in May with $4.4 billion of debt. Judge Jones said he understood the pain that comes with losing an investment but was also aware that the reorganization plan was not to blame for the lost equity. "Equity was lost long ago," he said. Even though it is normal for shareholders to lose their investment during a bankruptcy, SandRidge's shareholders were hoping to prove its assets were valuable enough so they would recoup some money after repaying creditors. SandRidge said that it hoped to emerge from bankruptcy within the next month, eliminating $3.7 billion in pre-petition debt. Read more.

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Samsung Electronics Co. Ltd. yesterday asked a U.S. judge to allow the South Korean company to pay cargo handlers to remove its goods from Hanjin Shipping Co Ltd's vessels stationed near U.S. ports after the world's seventh-largest container carrier filed for bankruptcy, Reuters reported. Hanjin's collapse last week came during the peak shipping period ahead of the year-end holiday season, stranding cargo for the likes of HP Inc. and Samsung. Around $14 billion of cargo has been tied up globally as ports, tug boat operators and cargo handling firms refuse to work for Hanjin because they fear they will not be paid due to uncertainty over plans to provide new financing. Samsung said an order this week by a U.S. bankruptcy judge did not encourage the Hanjin ships to enter U.S. ports as intended, which the company blamed on a misunderstanding of maritime law, the Bankruptcy Code and Korean law. The maker of electronic goods including Galaxy smartphones said that the judge should issue an order barring the seizure of ships and allow it and other cargo owners to retrieve their goods by paying cargo handlers, who have been demanding payment guarantees.