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A federal bankruptcy judge yesterday dismissed lawsuits by the trustee liquidating Bernard Madoff's firm to recoup funds from Koch Industries Inc., the company controlled by billionaire brothers Charles and David Koch, and dozens of other defendants, Reuters reported yesterday. Bankruptcy Judge Stuart Bernstein said that defendants in most of the 88 lawsuits could keep money that Irving Picard, who is liquidating Bernard L. Madoff Investment Securities LLC, traced to the swindler but was sent outside the United States. Picard had sought to recover hundreds of millions of dollars from foreign entities that had received Madoff-linked money from other foreign transferees, including "feeder funds" operated by Fairfield Greenwich Group and Tremont Group Holdings, as well as the Kingate feeder funds. But in an 87-page decision, Judge Bernstein dismissed a majority of Picard's claims against the "subsequent foreign transferees" because of international comity, the need to let other countries enforce their own laws. He also dismissed dozens of claims, including against affiliates of HSBC Holdings Plc and UBS Group AG, based on "extraterritoriality," because the defendants had insufficient ties with the United States. Read more. 

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Spanish renewable energy and engineering firm Abengoa SA has asked a U.S. bankruptcy court to enjoin legal action and future claims by creditors who are unsatisfied with a high-stakes plan to restructure $10 billion of debt, Reuters reported yesterday. Abengoa, a Sevilla-based company with a global renewable energy footprint, put its U.S. subsidiaries in chapter 11 protection this year and filed for chapter 15 protection from creditors of non-U.S. businesses while it thrashed out a refinancing deal to avoid becoming Spain's largest-ever corporate failure. Last month the vast majority of Abengoa's international creditors signed on to its so-called master restructuring agreement, which will give creditors equity in exchange for debt. The deal was approved by a Spanish court on Nov. 8.

Platinum Partners’ flagship hedge fund on Monday secured a legal shield that puts on-hold litigation accusing the troubled fund of looting Texas oil and gas company Black Elk Energy Offshore LLC, the Wall Street Journal reported today. Bankruptcy Judge Shelley Chapman said during a court hearing in Manhattan that she will grant the Platinum fund and a separate feeder fund recognition under chapter 15, the section of U.S. bankruptcy law dealing with international insolvencies. Her decision gives breathing space to the funds’ Cayman Island liquidators. The funds were placed in liquidation in the Cayman Islands over the summer with “a large amount of investor redemptions remaining unpaid past their due date,” according to filings by the liquidators made with the U.S. Bankruptcy Court in New York.

Big Apple Circus filed for bankruptcy after several years of declining interest, following the failure of a last-ditch fundraising drive, Reuters reported yesterday. The nonprofit circus sought chapter 11 protection from creditors on Sunday from the U.S. bankruptcy court in Manhattan, four months after cancelling its 2016-17 season. In a court filing, Executive Director Will Weiss said that the circus plans to sell its equipment, as well as its storage and training facilities in Walden, N.Y., with the hope a new owner with greater resources can restart the one-ring show. Weiss also hopes to find non-profits to run community programs serving hospitals, nursing homes and schools, including "Clown Care" for seriously ill children in hospitals. Big Apple Circus reported $3.8 million in assets and debts of $8.3 million.

A bankruptcy judge yesterday sent the site of a proposed 950-foot luxury residential tower on Manhattan’s East Side to the auction block, approving a sale process that seeks to place the controversial project into new hands by the end of the year, the Wall Street Journal reported today. Developer Joseph Beninati’s Bauhouse Group put the development into chapter 11 bankruptcy in April to try to halt a foreclosure after he was unable to refinance $147 million in loans the group used to acquire land and air rights to build the 78-story tower. Now those assets are up for sale in a court supervised auction, approved yesterday by Bankruptcy Judge Sean Lane. Judge Lane previously signed off on brokers hired to market the site, which is embroiled in financial and legal woes as well as a backlash from the local community.

The U.S. government's bankruptcy watchdog objected yesterday to a Caesars Entertainment Corp. subsidiary's proposal to exit chapter 11, threatening to derail a largely consensual plan to slash $10 billion of debt, Reuters reported. The Caesars subsidiary, Caesars Entertainment Operating Co. Inc. (CEOC), filed an $18 billion bankruptcy in January 2015 amid allegations by creditors that its private equity-backed parent had looted the unit of its best assets and stripped debt guarantees. Feuding parties made a peace deal in September that included a $5 billion contribution by Caesars to the unit's reorganization plan in exchange for releases from billions of dollars in potential legal claims. In a filing with the U.S. Bankruptcy Court in Chicago, the U.S. Trustee objected to the releases and the exculpation of "a wide array of parties for acts far beyond the plan or the Chapter 11 cases." The U.S. Trustee called the releases "blanket immunity." A report by an independent examiner in March said that Caesars and its private equity backers Apollo Global Management LLC and TPG Capital Management LP could be on the hook for up to $5.1 billion in damages for the alleged asset-stripping.

Women’s apparel retailer The Limited Stores has hired Guggenheim Partners as financial adviser to explore a possible sale, the Wall Street Journal reported today. The retailer, which is backed by Florida private-equity firm Sun Capital Partners Inc., has been struggling recently because of declining traffic at malls and industry headwinds that have led to the recent bankruptcy filings of other retailers. “Limited Stores is exploring a number of options that would provide the company with greater financial flexibility,” a company representative said on Friday. The Limited was founded in 1963 in Columbus, Ohio, and went public in the early 1980s. In 2007, L Brands Inc., the current owner of Victoria’s Secret and Bath & Body Works, agreed to sell a 75 percent stake in the company to Sun Capital. The retail-focused private-equity firm had chipped in $50 million of equity and lined up a $75 million loan to buy Limited Stores. Later in 2010 L Brands sold its remaining 25 percent stake to Sun Capital for roughly $32 million. According to Sun Capital’s website, The Limited, which offers “upscale” branded women’s clothing, has 243 stores throughout the U.S. Read more. (Subscription required.) 

Top restructuring experts will discuss strategies to keep a struggling retailer out of bankruptcy at ABI’s Winter Leadership Conference. Click here to register. 

Brookfield Asset Management has hung a possible price tag on its proposed takeover of TerraForm Power Inc., at $13 per share, a penny under Thursday’s market closing price, the Wall Street Journal reported on Saturday. The overture from Brookfield and its deal ally, the hedge fund Appaloosa Management, spurred a slight uptick in trading in TerraForm Power, a publicly traded “yieldco” that owns renewable energy assets, which gained about 3 percent in the hours after the Friday announcement with the Securities and Exchange Commission. Brookfield has been openly pursuing TerraForm Power since June. In a letter emailed on Thursday to the independent directors of TerraForm Power, Brookfield urged swift action to stay ahead of bondholders, and, potentially, bankruptcy. By Dec. 6, bondholders could be in position to push TerraForm Power into bankruptcy, Brookfield wrote. That is due largely to a running event of default on debt related to the company’s failure to file audited financial statements.

Auto parts maker Transtar Holding Co. filed for bankruptcy Sunday after reaching a deal with its senior lenders to swap their debt for ownership of the company, the Wall Street Journal reported today. The company filed for chapter 11 protection in U.S. Bankruptcy Court in New York with a pre-packaged chapter 11 plan after garnering support from its creditors to support the restructuring proposal. The plan calls for the senior lenders, led by Silver Point Capital, to swap about $425 million in debt for 100 percent of the equity in the reorganized company. Joseph Santangelo, Transtar’s chief financial officer, blamed the company’s chapter 11 filing on the “higher than anticipated difficulty” of integrating its newly-acquired ETX’s business, an aftermarket transmission parts maker, into the company.