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HRG Group Inc., the holding company formerly known as Harbinger Group Inc., is still paying for the collapse of RadioShack Corp. as it seeks to recover from losses on loans two units made to the retailer before its bankruptcy filing, Bloomberg News reported today. Fidelity & Guaranty Life said on Wednesday that its participation in a $250 million loan to RadioShack arranged by HRG-owned Salus Capital Partners contributed to a $32 million impairment charge that wiped out its first-quarter profit. Harbinger bought FGL in 2011 under former Chairman Philip Falcone, then sold a stake of about 19 percent in an initial public offering in 2013. HRG said in a statement it’s considering the sale of the remaining stake. It’s also reviewing options for Salus that include a sale of the firm after the lender suffered losses linked to the RadioShack loan.

Cache Inc.'s unsecured creditors dropped a bid to force the liquidating women's retailer into a chapter 7 bankruptcy after reaching concessions with the company and its secured lender, Salus Capital Partners, Dow Jones Daily Bankruptcy Review reported today. Through a deal reached just minutes before a court hearing yesterday, Salus has agreed to set aside $800,000 from what otherwise would have been its cash collateral to help pay creditors. The money will fund stub rent claims owed to Cache's now-former landlords as well as pay suppliers for goods delivered in the 20 days prior to Cache's bankruptcy filing.

Aereo Inc. won bankruptcy court approval of a settlement to pay CBS Corp. and other broadcasters $950,000 to resolve copyright claims totaling more than $99 million as the defunct online-TV service backed by Barry Diller winds down, Bloomberg News reported yesterday. The deal, paying less than a penny on the dollar to creditors, will save Aereo from spending the rest of its dwindling cash on drawn-out litigation, Bankruptcy Judge Sean Lane ruled yesterday. The settlement, which was backed by all the broadcasters, gives them less money than the lawyers and other bankruptcy experts are getting from the case. It also leaves Aereo with $811,000 to pay non-broadcast creditors with claims totaling $7.5 million.

Optim Energy LLC has abandoned the bankruptcy sale of its two Texas power plants and instead will restructure under a plan that leaves Bill Gates's private-equity firm in control of the company, Dow Jones Newswires reported yesterday. Optim is controlled by the Microsoft Corp. co-founder's Cascade Investment, which had set a floor price for the plants at $355 million, subject to higher bids at auction. But after an extensive marketing campaign, Optim's lawyers said on Wednesday in court papers, the company didn't receive any satisfactory bids for the plants. “The reorganizing debtors have now determined, in consultation with their advisers, independent directors and the consultation parties, that the best path forward is to terminate the sale process and instead seek confirmation of the plan," Optim said in court papers. The plan will give the senior lenders, which includes Cascade, ownership of the reorganized company, a second-lien note plus residual cash.

The U.S. Trustee in Standard Register Co.’s bankruptcy case filed a scathing objection to its $4.3 million bonus plan, the Dayton (Ohio) Business Journal reported today. Among the more than a dozen points in Wednesday’s filing, the U.S. Trustee Andrew Vara said that Dayton-based Standard Register did not demonstrate that the payments are necessary to preserve the value of the company through the bidding process. Last month, Standard Register asked a bankruptcy judge to approve a key employee incentive plan that includes 49 people in senior-level or executive positions. Standard Register, which has about 850 local employees, contends the plan is necessary to motivate key workers and includes “ambitious” revenue and profit goals.

The 187 Roman Catholic parishes in the Archdiocese of St. Paul and Minneapolis will have a greater voice in the church’s bankruptcy proceedings as the result of a court ruling yesterday, the Minneapolis Star Tribune reported today. Bankruptcy Judge Robert Kressel said that the court will appoint a creditors committee representing parishes that will participate in mediation sessions forging financial settlements and archdiocese reorganization plans. Parishes aren’t adequately represented by the official creditors’ committee, which is composed of five clergy abuse survivors, said Mary Jo Jensen-Carter, an attorney representing 118 parishes. Parishes have significant claims against the archdiocese, including up to $17 million in overpayments to its insurance funds and liabilities from clergy abuse by priests appointed by the archdiocese, she said.

Two of the nation’s biggest banks will finally put to rest the zombies of consumer debt — bills that are still alive on credit reports although legally eliminated in bankruptcy — potentially providing relief to more than a million Americans, the New York Times DealBook reported yesterday. Bank of America and JPMorgan Chase have agreed to update borrowers’ credit reports within the next three months to reflect that the debts were extinguished. The change by the banks emerged this week in Federal Bankruptcy Court in White Plains, N.Y., where the two banks, along with Citigroup and Synchrony Financial, formerly GE Capital Retail Finance, face lawsuits accusing them of deliberately ignoring bankruptcy discharges to fetch more money when they sell off pools of bad debt to financial firms. The lawsuits accuse the banks of engineering what amounts to a subtle but ruthless debt collection tactic, effectively holding borrowers’ credit reports hostage, refusing to fix the mistakes unless people pay money for debts that they do not actually owe. Lawyers with the United States Trustee Program, an arm of the Justice Department, are investigating whether the banks are deliberately flouting federal bankruptcy law.

Frederick’s of Hollywood Inc. received bankruptcy-court approval Wednesday to move forward with a $22.5 million offer that would keep the iconic brand alive, the Wall Street Journal reported today. A bankruptcy judge signed off on the company’s proposed protections for the offer from Authentic Brands Group Inc., which will be tested at auction on May 28 should competing offers emerge. Bankruptcy Judge Kevin Gross said at a hearing yesterday that the bid rules proposed by Frederick’s are “perfectly adequate” and “possibly in a form that would create some competitive bidding.” The offer from Authentic Brands is for Frederick’s intellectual property, some inventory and its e-commerce business, since the company entered bankruptcy having shut down its remaining store locations. The protections for that bid include a $775,000 termination fee, negotiated down from $850,000 with the committee representing unsecured creditors, and $300,000 in expense reimbursement.

The bankrupt operating unit of casino company Caesars Entertainment Corp. agreed to grant creditors access to records through an independent examiner probing pre-bankruptcy deals, but a judge said that he will wait until Monday to approve the agreement, Reuters reported yesterday. Bankruptcy Judge Benjamin Goldgar said that he would also decide then whether to grant creditors' request for access to communications regarding the likelihood of success of the largest U.S. casino operator's restructuring plan. The casino operator, a unit of Caesars Entertainment Corp., went bankrupt in January with $18 billion in debt.

Freedom Industries officials said yesterday that they are willing to amend their bankruptcy plan to steer more money toward additional cleanup measures at the company’s Etowah Terminal — assuming that the West Virginia Department of Environmental Protection (DEP) will clarify what it wants done at the site, the Charleston (W.Va.) Gazette reported today. In a new filing in U.S. Bankruptcy Court, Freedom Chief Restructuring Officer Mark Welch welcomed the DEP’s proposal that the company set aside $1 million for the cleanup of the Elk River facility, where a January 2014 chemical leak contaminated the drinking water supply for 300,000 residents across the region. Welch said that the DEP’s formal objection to Freedom’s latest bankruptcy liquidation plan is “a positive step in the right direction” because state officials have, “for the first time in this process, provided [Freedom] with a specified target to meet.” Now, Welch said, he wants the DEP to “clearly define and justify the proposed uses” for the money agency officials say is needed for the cleanup.