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The former operator of Asics stores, including its now-closed flagship U.S. location in Times Square, has filed for chapter 11 protection amid a dispute with the running shoe maker, the Wall Street Journal reported today. Windsor Financial Group LLC on Friday sought protection in the U.S. Bankruptcy Court in Manhattan, court papers show, following what it says was the improper termination of a licensing agreement that allowed Windsor to operate 13 Asics stores in the U.S., which are now closed. According to Windsor Chief Executive Armando Ruiz, the stores that Windsor operated helped Asics’s U.S. unit surpass its native Japan as the company’s top region, with sales topping $1 billion in 2014. But Windsor and Asics’s partnership later soured. In July, Asics America Corp. sued Windsor in a California federal court, seeking nearly $6 million owed under the licensing agreement and trying to stop Windsor from continuing to sell Asics products at its stores. Then in October, Windsor’s investors sued Asics for allegedly withholding inventory and support for marketing activities.

Vantage Drilling won confirmation yesterday of a chapter 11 plan that will chop its debt load and set the oil-and-gas drilling company up to compete in an increasingly rough market, Dow Jones Daily Bankruptcy Review reported today. Bankruptcy Judge Brendan Shannon approved Vantage's balance-sheet reshaping yesterday at a hearing. The bankruptcy restructuring moved swiftly, the judge said, but the speed was justified by the "absolute tumult" in the oil and gas industry. Vantage owns three state-of-the-art ships and four rigs designed to drill in ultradeep ocean waters. The company is trimming its debt load to survive the drop in oil and gas prices, as well as to improve its chances of staying busy in a market in which work is hard to find. The company filed for protection in December, claiming support from most of its lenders for the chapter 11 plan, which will reduce secured debt of $2.6 billion to less than $1 billion, or even lower, depending on what investors do with new convertible notes issued under the plan. Read more. (Subscription required.) 

For further analysis of oil and gas bankruptcies, be sure to pick up a copy of ABI’s When Gushers Go Dry: The Essentials of Oil & Gas Bankruptcy. 

Parties seeking a chunk of the $7 billion raised from the liquidation of former telecommunications giant Nortel Networks started talks yesterday aimed at ending one of the most complex and costly legal disputes in history, Reuters reported yesterday. The money has been sitting in a New York bank account since Nortel Networks global businesses were sold piecemeal after the Ontario-based company filed for bankruptcy exactly seven years ago. The talks on yesterday in New York include representatives from former Nortel operations in the United States, Canada and Europe, according to two sources who declined to be identified because the mediation was confidential. The parties had presented dramatically differing proposals to a judge in Ontario and a U.S. Bankruptcy judge in Delaware during a novel, joint trial in 2014 aimed at dividing the cash. The judges issued coordinated opinions in May that rejected the proposals from the various Nortel estates and ruled that every creditor would receive roughly 71 cents on the dollar, a position backed by some creditors. That sparked appeals. If the current talks can reach a settlement to divide the cash, it would end the appeals process. One of the big fears among the parties is that parallel appeals in the United States and Canada could result in conflicting rulings that further complicate the dispute. "It's a Charles Dickens novel," said Melissa Jacoby, a law professor and resident scholar at the American Bankruptcy Institute.

The trustee liquidating the Bernard Madoff Ponzi scheme under the Securities Investor Protection Act won an appellate victory in Manhattan District Court upholding the bankruptcy court-approved method for calculating customers’ claims involving inter-account transfers, ABI’s Rochelle Daily Wire reported today. In his 53-page opinion on Jan. 14, U.S. District Judge Paul A. Engelmayer said that the approach proposed by Madoff trustee Irving Picard was the “only method” consistent with the Second Circuit’s so-called net equity opinion in 2011. Judge Engelmayer’s decision upheld the trustee’s methodology in objecting to more than 400 customer claims. Madoff pretended to be investing customers’ funds by purchasing securities. However, he never purchased a single share of stock. Consequently, all the profits shown on customers’ account statements were fictitious. In its 2011 net equity decision, the Second Circuit upheld the trustee and ruled that a customer’s proper claim must ignore the account statements. Instead, each allowed claim equals the customer’s cash investment less amounts withdrawn, thus ignoring fictitious profits. The 2011 decision did not address the method to employ when a customer transferred money from one Madoff account to another. Read more. 

For further analysis of fraud and forensics in a commercial bankruptcy case, including the Madoff case, be sure to pick up ABI’s Fraud and Forensics: Piercing Through the Deception in a Commercial Fraud Case. 

American Apparel Inc.’s board of directors rejected the latest takeover offer involving the company founder and fired Chief Executive Officer Dov Charney, Bloomberg News reported yesterday. The vote means an offer valued at $300 million from three investment funds who’ve aligned with Charney must be further sweetened to win over the company, or they must convince a judge next week to throw out a competing proposal backed by American Apparel’s lenders. The company is open to a revised offer from the funds. Hagan Capital Group and Silver Creek Capital Partners have offered to buy the company and bring back Charney, who was fired in 2014 when the board accused him of misusing corporate funds and violating the sexual-harassment policy. Time is almost up for the funds and Charney. On Jan. 20, the company will be in court seeking approval of its reorganization plan, which would cut about $200 million of debt. The company would be taken over by a group of senior lenders, including Monarch Alternative Capital LP.

Quiksilver Inc., the bankrupt surfwear retailer, is in talks with banks for a loan that would help finance its business after it exits bankruptcy, Bloomberg News reported yesterday. Bank of America Corp. and JPMorgan Chase & Co. are among lenders discussing an asset-backed credit line for the company. The revolving loan may be $125 million to $150 million, and the company may seek a term loan as well. Quiksilver, rooted in the seaside cultures of Australia and Southern California, filed for bankruptcy protection in September after years of struggling to compete against fast-fashion retailers like Hennes & Mauritz AB. At the time of the filing, it had about $826 million in total debt, which will be cut to less than $300 million under a restructuring plan that will hand control of the company to Oaktree Capital Management LP. Under the restructuring plan, Oaktree, which holds roughly 73 percent of the chain’s $279 million in senior notes, would own the company after swapping the debt and buying the remaining securities not sold in a rights offering to existing bondholders.

Arch Coal Inc.’s chapter 11 filing on Monday has left some citizens groups concerned about the company’s ability to clean up pollution at its Wyoming mines, the Wall Street Journal reported yesterday. Coal miners such as Arch must, under state and federal law, post reclamation bonds to show their ability to clean up the land and treat the water at their mining sites. Some states allow what is called self-bonding, in which the bonds aren’t backed by any insurance. While self-bonds can save companies money, questions arise about their ability to fulfill the bonds when they run into financial trouble. If a company can’t pay for cleaning up the polluted land and water at a mine, the bill could be passed on to taxpayers. In Arch’s case, its lenders have agreed to cover up to $75 million in cleanup and other regulatory obligations in connection with a proposed $275 million bankruptcy loan. But that falls short of the $485 million in self bonds that court papers show Arch has posted for its Wyoming mining operations.

Nortel Networks Corp.’s warring creditors will meet in New York today seeking to end a standoff that has kept pensioners and bondholders waiting to divvy up $7.3 billion in the defunct telecommunications company’s seven-year bankruptcy, Bloomberg News reported yesterday. The goal is to resolve court appeals in the U.S. and Canada so the money, most of which was raised in one of the most successful patent auctions in the U.S., can be distributed. Nortel retirees in Canada and the U.K. have been fighting with U.S. bondholders over how to divide the cash, raised when Nortel’s U.S. unit sold a bundle of patents in 2011 to a group that included Microsoft Corp., Apple Inc. and Sony Corp. In May, judges in the U.S. and Canada ruled that the money should be split on a proportional basis once claims against the Canadian company are resolved.

TransCoastal Corp., one of the latest victims of falling oil and gas prices, on Monday won approval from a bankruptcy judge for its reorganization plan, Dow Jones Daily Bankruptcy Review reported today. The pre-packaged plan, for which the Texas oil and gas company secured creditors' support before filing for bankruptcy, calls on its senior lender to swap roughly $21 million in debt for new equity in the reorganized company. When TransCoastal filed for chapter 11 protection on Dec. 8, it sought to reduce its debt by about 85 percent. The restructuring plan also called for TransCoastal to access up to $4 million in new capital. Read more. (Subscription required.) 

For further analysis of oil and gas bankruptcies, be sure to pick up a copy of ABI’s When Gushers Go Dry: The Essentials of Oil & Gas Bankruptcy.