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Judge Delays SunEdison Request for Independent Investigation

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Bankruptcy Judge Stuart M. Bernstein on Friday pushed back an unusual request by SunEdison Inc., a solar-power giant that landed in bankruptcy a day ago, to launch an independent investigation into its dramatic reversal of fortunes, the Wall Street Journal reported on Saturday. Judge Bernstein said that creditors needed more time to organize before he would consider appointing an independent examiner. The U.S. Justice Department and the Securities and Exchange Commission are investigating whether SunEdison management misled the public as the company began to struggle. The examiner request has already drawn fire from bondholders, wary of any efforts by SunEdison to set the scope, cost and duration of the investigation so early in the case. Though the judge shelved SunEdison’s examiner request for now, he approved a number of other requests on Friday aimed at easing the company’s transition into bankruptcy and limiting disruptions while it works out a plan to cut its multibillion debt load. The judge said SunEdison could borrow $90 million under a $300 million bankruptcy loan and signed off on SunEdison’s other requests to ease its transition into bankruptcy while it works out a plan to cut its multibillion debt load.

New Jersey Abortion Clinic Files for Bankruptcy

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A New Jersey abortion clinic has filed for bankruptcy after losing a legal battle with several former employees who said they were fired after becoming pregnant, the Wall Street Journal reported today. Pilgrim Medical Center Inc. filed for chapter 11 protection after a judge awarded more than $1 million to three ex-workers who sued the clinic for discrimination. The legal award against Pilgrim Medical Center, which is based in Montclair and employs 22 people, is worth more than half of the $1.8 million in revenue the clinic took in last year, according to documents filed in U.S. Bankruptcy Court in Newark. The clinic is appealing the judgment. The former employees — two medical assistants and an administrative worker — sued in the fall of 2013, accusing supervising physician and clinic owner Nicholas Campanella of punishing them for taking or requesting maternity leave.

Colleges Continue to Return Tuition Money in Bankruptcy Fights

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Colleges have returned $276,434.80 in tuition payments that were made for students whose parents later filed for bankruptcy protection, a Wall Street Journal analysis of more than two dozen lawsuits filed since 2014 has found. Villanova University, Ithaca College and the New York Institute of Technology are just some of the schools that have been sued by bankruptcy trustees. The trustees, who are in charge of recovering money for the debts of the bankrupt parents, argue that financially struggling parents should have paid their own bills instead of college tuition for a child. The Wall Street Journal analysis found that most schools have opted to settle the cases and return the tuition rather than battle expensively in court, though two schools are pushing forward in lawsuits that could lead judges to clarify whether the controversial lawsuits are fair. Four federal lawmakers are backing a bill to ban them.

San Bernardino Bankruptcy Plan Would Shield Police from Claims

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The city of San Bernardino, Calif., wants to shield individual police officers from liability for settlements and pending lawsuits over alleged incidents of brutality and excessive force as it attempts to emerge from bankruptcy protection, the Wall Street Journal reported today. A clause outlining protections for city employees, including its 250-person police department, was buried in San Bernardino’s latest plan to exit bankruptcy protection, which was filed last month. The bankruptcy court judge will consider this request, along with other aspects of the plan, in a hearing scheduled for April 27. The outcome of that hearing will help determine how much longer San Bernardino will remain mired in bankruptcy protection, which it entered in August 2012 after a collapse in housing prices led to a shortfall in tax revenues. Families who are suing the San Bernardino police department filed an objection with the bankruptcy court last week that said the current plan would unfairly “cloak the third-party actors responsible for the egregious conduct.” The city is facing 112 lawsuits that seek compensation for injuries and deaths allegedly caused by its police officers and employees, according to documents filed in U.S. Bankruptcy Court in Riverside, Calif. Some police officers were also named in lawsuits that were filed under civil-rights law.