%1

Pacific Sunwear of California Inc., the long-struggling surfwear chain, is preparing to file for bankruptcy, Bloomberg News reported yesterday. The chapter 11 filing could come as soon as next week, though the situation remains fluid, and the timing could change. PacSun is the latest casualty of sluggish retail spending and shifting consumer tastes, which have pushed chains such as American Apparel Inc. and Quiksilver Inc. into bankruptcy court during the past year. PacSun has recorded losses every year since 2008, and its shares have plunged about 90 percent in the past 12 months. The Anaheim, Calif.-based company, which operated 613 stores as of December, didn’t immediately respond to a request for comment. An affiliate of private equity firm Golden Gate Capital has provided PacSun with a $60 million senior secured term loan, giving it leverage in a potential bankruptcy. San Francisco-based Golden Gate’s consumer and retail portfolio includes California Pizza Kitchen, Eddie Bauer and Payless ShoeSource.

The drama between Sports Authority Holdings Inc. and consignment suppliers is coming to an end with a settlement that looks to resolve more than 160 lawsuits, the Wall Street Journal reported today. Sellers of shoes, gloves and other winter gear sold on consignment sought the return of their goods after Sports Authority filed for bankruptcy last month. The retailer, which is liquidating some 140 stores, said that it needed the gear to sell at its remaining stores and sued the consignment sellers to block them from seizing the goods. The dispute revolves around about $85 million worth of winter gear currently being sold at the struggling retailer’s stores. The settlement, if approved by Bankruptcy Judge Mary Walrath would keep these products on Sports Authority’s shelves throughout the chapter 11 proceedings.

Northwest Territorial Mint LLC put its coin-and-medallion-making operations into bankruptcy on Friday, facing a demand to pay part of a $38.3 million defamation award — one of the country’s largest Internet defamation verdicts — to a Los Angeles businessman and his real-estate firm, the Wall Street Journal reported on Saturday. Officials for the mint, located near Seattle, listed the judgment owed to Bradley S. Cohen and to Cohen Asset Management Inc. as a “disputed” debt in bankruptcy court documents. The 200-worker company, based in the town of Federal Way south of Seattle, on its website calls itself the country’s largest private mint with other minting facilities in Texas and Nevada and die-cutting and sculpting facility in Green Bay, Wis.Northwest Territorial Mint LLC put its coin-and-medallion-making operations into bankruptcy on Friday, facing a demand to pay part of a $38.3 million defamation award — one of the country’s largest Internet defamation verdicts — to a Los Angeles businessman and his real estate firm.

PostRock Energy Corp. filed for bankruptcy Friday amid falling oil prices, KOCO.com reported. PostRock also announced the resignation of directors within the company. PostRock's primary production area is focused in southeastern Kansas and northeastern Oklahoma. The company owns and operates over 2,500 wells in the area.

Goodrich Petroleum Corp. said on Friday that it plans to file for bankruptcy protection in the coming weeks after reaching a deal on the terms of a debt-for-equity swap with its junior bondholders, the Wall Street Journal reported on Saturday. The Houston-based oil and gas company said it plans to file a pre-packaged bankruptcy plan by April 15 after striking a deal with its second-lien bondholders that calls for them to swap $175 million in debt for 100 percent of the reorganized Goodrich. Under the proposed restructuring agreement outlined in a regulatory filing, senior lenders would be paid in full or have their debt reinstated. The reorganized Goodrich, which drills for crude oil and natural gas in the Tuscaloosa Marine shale formation in Louisiana and Mississippi, would emerge from the anticipated bankruptcy as a going concern with its day-to-day operations substantially intact. Read more. (Subscription required.) 

Has the final shoe dropped for the E&P industry? A session at ABI's 34th Annual Spring Meeting features experts discussing energy industry distress. Click here to register. 

Get a better understanding of what happens when an oil, gas or other natural resources company goes bankrupt. Pre-order your copy of ABI's revised and expanded When Gushers Go Dry: The Essentials of Oil & Gas Bankruptcy, Second Edition. 

The federal judge who presided over some of the complex legal battles that arose following the collapse of Bernard Madoff’s Ponzi scheme got a new messy dispute to untangle — bondholders versus Caesars Entertainment, the Wall Street Journal reported on Saturday. Judge Jed Rakoff has been reassigned the four bondholder lawsuits now pending against Caesars in a Manhattan district court, court records show. The reassignment follows the news that Judge Shira A. Scheindlin, who had previously overseen the litigation, will retire April 29, just days before a trial on two of the suits was scheduled to begin.

Bankruptcy Judge Kevin Carey agreed to extend the shield of U.S. bankruptcy law to Abengoa SA while the Spanish renewable energy company works to secure creditors’ support for a restructuring plan, the Wall Street Journal reported today. Judge Carey yesterday agreed to preliminarily shield Abengoa SA and a host of affiliates from any creditor actions in the U.S., extending a protection that Abengoa has already secured from a Spanish court. Abengoa this week sought protection under chapter 15 of the U.S. bankruptcy code, which is available to foreign companies, after 75 percent of its financial creditors signed on to a standstill agreement that gives Abengoa until the end of October to reach a comprehensive restructuring agreement without the threat of its creditors interfering with those efforts. Read more. (Subscription required.) 

Cover all aspects of the UNCITRAL Model Law on Cross-Border Insolvency as well as chapter 15 of the Bankruptcy Code with ABI’s Chapter 15 for Foreign Debtors. 

The cost of the Caesars Entertainment Operating Co. bankruptcy investigation that dug up as much as $5.1 billion in potential legal claims has topped $40 million and is still climbing, the Wall Street Journal reported today. New bankruptcy court filings show examiner Richard J. Davis and his team charged nearly $25 million for work performed as the probe into CEOC’s dealings with its parent company heated up. The new round of bills brings the total cost of the investigation, launched in March 2015, up to $41.8 million. The cost of the court-ordered probe, borne by CEOC, is expected to climb further, as the latest bills only cover work performed between Oct. 1 and Jan. 31. A report on the investigation’s findings was released on March 15. That report concluded that Caesars Entertainment Corp. and its private-equity owners engineered a series of deals that hurt the company’s now-bankrupt operating unit and its creditors, resulting in potential damages of $3.6 billion to $5.1 billion.

Swift Energy Co.’s reorganization plan won approval from a bankruptcy judge on Wednesday, paving the way for the oil and gas driller to exit chapter 11 under the control of its bondholders, the Wall Street Journal reported today. Bankruptcy Judge Mary Walrath signed off on the plan, which will swap $905 million in bond debt for most of the new equity in the restructured Swift. It also will allocate a 4 percent equity stake in the postbankruptcy company to existing shareholders, as well as fully repay about $46 million in unsecured claims. Judge Walrath’s approval came after Swift Energy’s attorneys listed numerous modifications made to the plan to resolve objections and concerns from the likes of the U.S. Department of the Interior, unsecured creditors and the Internal Revenue Service. The reorganization plan was put to a creditor vote in mid-February and was approved by 91 percent of the senior note holders.