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The companies that own Hollywood Pavilion hospital, whose former CEO is currently in prison for Medicare fraud, filed for Chapter 11 reorganization to stay a foreclosure lawsuit, the South Florida Business Journal reported yesterday. Former Hollywood Pavilion CEO Karen Kallen-Zury was sentenced to 25 years in prison in 2013 after being convicted of more than $39 million in fraudulent billing by bribing patients to receive phony care at its facility. She has appealed her conviction. Later that year, the 58,189-square-foot hospital and rehab facility was hit with a foreclosure lawsuit. Subsequent to the lawsuit being filed, an entity related to South Miami, Fla.-based Larkin Community Hospital bought the distressed mortgage and took over management of both the 50-bed hospital and the 152-bed rehabilitation facility under a receivership court order. The foreclosure lawsuit is pending. http://www.bizjournals.com/southflorida/news/2015/04/09/hollywood-hospital-files-chapter-11-as-former-ceo.html?ana=twt

For more on hospital and medical bankruptcies, be sure to pick up a copy of the ABI Health Care Insolvency Manual, Third Edition from the ABI Bookstore. 

A bankruptcy judge gave permission for lawyers in charge of long-dead manufacturer Yarway Corp., which made valves and steam traps for the steam power industry, to pay hundreds of millions of dollars to individuals who said the Pennsylvania company exposed them to asbestos, Dow Jones Daily Bankruptcy Review reported today. The court-approved plan will split $325 million in cash from Yarway and its indirect owner, Tyco International Ltd., the fire protection and security company. The plan gives a legal shield to Tyco, which will be immune from future asbestos-related demands. (Subscription required.) http://bankruptcynews.dowjones.com/Article?an=DJFDBR0120150409eb49n4dhs&cid=32135009&ctype=ts

For further analysis of issues surrounding litigation or liquidation trusts, be sure to pick up a copy of ABI’s A Practitioner's Guide to Liquidation and Litigation Trusts from the ABI Bookstore. 

The Archdiocese of St. Paul and Minneapolis, Minn., got more time to construct a financial reorganization plan Thursday when a bankruptcy court judge extended its deadline to Nov. 30, the Minneapolis Star Tribune reported today. Archdiocese attorneys argued that it needed more time to work with insurance carriers and to determine a more precise number of abuse claims. The Twin Cities archdiocese has been in mediation with its creditors since filing for chapter 11 bankruptcy Jan. 16. The bankruptcy came in response to an unprecedented wave of clergy abuse lawsuits filed since 2013, when Minnesota temporarily lifted its statute of limitations on older abuse cases.

Erie Hockey LTD., the owner of the Ontario Hockey League's Erie Otters announced yesterday that they have filed for voluntary chapter 11 bankruptcy, YourErie.com reported yesterday. The Otters have been in a legal battle with the Edmonton Oilers of the National Hockey League over a forced sale of the team so that the Oilers could reclaim a $4.6 million loan they gave the Otters to maintain operations in exchange for Otters owner Sherry Bassin to sell the team to the Oilers at a later time. The deal fell through and the Oilers sued in federal court. The suit was dismissed in December.

Creditors say that retailer Cache Inc. has been running up bills it can't pay and should be pushed out of chapter 11 into a barebones form of bankruptcy, Dow Jones Daily Bankruptcy Review reported today. The official committee that represents landlords and suppliers to the women's dress and formalwear retailer Wednesday asked a bankruptcy judge to convert Cache's bankruptcy into a chapter 7 case and allow a trustee to take over the proceeding.

Bankruptcy Judge John Waites on Monday authorized lawyers for the Golf Club at Briar’s Creek in South Carolina to send the course’s sale proposal to current and former club members who are expecting to recover less than half of $13 million in owed refunds, the Wall Street Journal reported today. The proposal would sell the club to investors for $7.4 million in cash. Under the plan, investors — led by Houston Texans football team owner Bob McNair — would take over the private, 18-hole course near Charleston. Judge Waites promised to look over the voting results from members and other creditors at a May 13 bankruptcy confirmation hearing. The course, which employs about 50 people, filed for chapter 11 bankruptcy protection on Feb. 9, saying that it hasn’t been able to persuade more than a handful of people to build homes on its lots. The community, spread over more than 900 acres, has only eight developed housing lots, according to court documents. The club, which has about 210 members, also saw its membership shrink during the economic recession.

Caesars Entertainment Corp.’s $468 million bankruptcy dispute will go to trial in August as the judge overseeing the case said that it’s probably irrelevant whether the casino company or its creditors acted in bad faith when they filed dueling petitions in January, Bloomberg News reported yesterday. Whether Caesars paid its debts as they came due is the main question, Bankruptcy Judge Benjamin Goldgar said during a hearing yesterday. Judge Goldgar must decide if the bankruptcy started Jan. 15 when the company filed its case or three days earlier when lower-ranking creditors filed an involuntary petition. Creditors can challenge a claim by senior lenders to $468 million in cash if they win. Credit Suisse Group AG, acting as an agent for senior lenders that loaned Caesars billions of dollars, sued lower-ranking creditors on Tuesday claiming they violated lender agreements. The suit is one of several related to restructurings and refinancings by Caesars.

Citing what he said was “major progress” in the Freedom Industries bankruptcy, a federal judge on Friday called off a hearing he had scheduled to force Freedom management to explain why key aspects of the case were stalled, the Charleston (W.V.) Gazette reported on Saturday. Bankruptcy Judge Ronald Pearson had scheduled a “show cause” hearing for Freedom for next week, saying that he wanted the company’s lawyers and its chief restructuring officer, Mark Welch, to explain why the case should continue down its current path, rather than being transferred to a more traditional liquidation through chapter 7. In a two-page order, Judge Pearson noted that the West Virginia Department of Environmental Protection had accepted Freedom into the state’s more flexible “voluntary” toxic-cleanup program and that DEP lawyers had reported in a motion filed on Thursday that the company and the agency had reached an agreement on a cleanup timeline. “This fact is indicative of major progress toward bringing this case towards conclusion,” the judge wrote. Judge Pearson said that the development also indicates that Freedom officials “may not be in a position to fully outline the steps and costs in an environmental remediation plan” by the scheduled hearing date of April 8.

Details filed this week in the bankruptcy case of Montreal Maine & Atlantic Railway Ltd., the operator of a train that crashed in Lac-Mégantic, Canada, killing 47 people, show how the company proposes splitting up that fund among several camps waiting for the money, the Wall Street Journal reported today. Government agencies, including the Province of Quebec, city of Lac-Mégantic and the Canadian government, are in line for the largest share of the funds, an estimated C$123 million. Families of those who died have been allocated C$77 million, personal-injury claims are in line for C$34 million, and those with property-damage claims should receive C$28 million. Within that C$77 million for wrongful death claims, the breakdown gets even more detailed. The 48 victims — including the 47 who died because of the crash and a first responder who committed suicide — are allocated between C$711,000 and C$3.69 million. Robert Keach, the court-appointed trustee overseeing MM&A’s bankruptcy, said on Wednesday that “no amount of money is ever going to be enough to address this tragedy, because it’s money.” Litigation continues against two parties that Keach and the victims would like to hold responsible for the crash: Canadian Pacific Railway, which transported the oil to Montreal, and oil supplier World Fuel Services Corp.

A federal bankruptcy judge yesterday said that she would approve an $82 million sale of Atlantic City's Revel Casino Hotel to Florida developer Glenn Straub, Reuters reported yesterday. Bankruptcy Court Judge Gloria Burns said that she would sign off on the deal, the third one she has approved. The previous two agreements failed. The offer, from polo club owner and distressed real estate mogul Straub, is a far cry from the $2.4 billion it cost to build the gleaming casino complex. Revel opened in 2012 to much fanfare, but it never turned a profit and went bankrupt twice. Judge Burns delayed the approval in part to see if other interested buyers could finalize deals, but none did. The judge noted that Revel's estate was losing money every day as it waited.