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Investors who pocketed $12.5 billion in the 2007 leveraged buyout of Lyondell Chemical Co. may have to defend lawsuits by Lydondell creditors seeking to claw that money back, according to a federal judge's ruling on Wednesday, Reuters reported yesterday. Billionaire Leonard Blavatnik led the Lyondell leveraged buyout in 2007, but in early 2009 the company filed for bankruptcy. Bankruptcy Judge Robert Gerber ruled on Wednesday that the company’s creditors could continue to pursue their clawback case and denied the defendants' motion to dismiss it. Gerber's 46-page opinion did dismiss allegations of intentional fraud by the defendants.

Bankruptcy Judge Christopher Sontchi yesterday rebuffed an attempt by NextEra Energy Inc. to involve itself once more in Energy Future Holdings Corp's chapter 11 sale of its power distribution business, Reuters reported yesterday. NextEra said in a court filing on Wednesday that it was prepared to close a deal for Oncor, the distribution unit, that it said was superior to a proposed sale at the center of Energy Future's plan to exit from bankruptcy. NextEra had briefly tried to buy Oncor last year. NextEra's filing came in the midst of a weeks-long trial to confirm Dallas-based Energy Future Holdings' plan of reorganization, which is built around a sale of Oncor to Hunt Consolidated of Texas and a group of creditors. That deal has been valued at around $19 billion. Judge Sontchi yesterday made clear he did not appreciate NextEra's filing, which came long after deadlines for objecting to the sale and bankruptcy.

A battle among Arch Coal Inc. creditors is intensifying as the miner prepares for a potential bankruptcy filing, Bloomberg News reported yesterday. A group of middle-tier bondholders hired law firm Brown Rudnick LLP to help protect their investments as the miner moves toward restructuring its $5.1 billion of debt in court proceedings. The creditors hold the miner’s $350 million of 8 percent second-lien bonds, which stand behind investors that hold $1.9 billion of first-lien loans. The hiring comes after Arch, the largest coal miner in the U.S. by volume after Peabody Energy Corp., said in a filing earlier this month that it was in talks with creditors on a “significant restructuring” of its balance sheet and it may file for chapter 11 protection regardless of whether it strikes a deal with creditors. 

NextEra Energy Inc. yesterday offered to buy Energy Future Holdings Corp.’s Oncor transmissions business, which is slated to be sold to an investment group led by Hunt Consolidated, the Wall Street Journal reported today. The sale of Oncor is at the heart of Energy Future’s $42 billion reorganization strategy, but the company has chosen the Hunt-led group as the buyer. NextEra said that it stands ready to purchase Oncor in a deal that would fully repay creditors of the division that owns the business. Energy Future decided to sell Oncor to Hunt and allied creditors after an auction was called off that would have allowed NextEra to bid against Hunt and others for the rights to the regulated business, a stable, cash-producing piece of the Texas power infrastructure.

Bankruptcy Judge Benjamin Goldgar agreed yesterday to delay a crucial hearing to review Caesars Entertainment Operating Co.’s chapter 11 plan until an independent examiner completes his probe into the casino operator's pre-bankruptcy transactions, Reuters reported yesterday. The decision comes after junior creditor groups and a U.S. Trustee asked the court to reject a request from Caesars, the bankrupt operating unit of Caesars Entertainment Corp., to hold the hearing in late January. Judge Goldgar said that he would not schedule a hearing to approve documents describing the bankruptcy plan, known as a disclosure statement, without knowing when examiner Richard Davis will deliver his report. At the same hearing, Judge Goldgar also said he would probably deny an unusual request by a group of creditors to prevent the Kirkland & Ellis law firm from continuing to represent Caesars. Junior bondholders, represented by Jones Day, allege that Kirkland and Ellis have a conflict of interest and they have accused its partner James Sprayregen of misleading the judge in a previous trial on the issue. Goldgar did permit Jones Day to perform a limited investigation of its allegations, but also said the request to remove Kirkland would probably be denied.

Quaker Steak & Lube, the Sharon-based restaurant chain, has filed for bankruptcy protection and said it expects to be acquired by TravelCenters of America for $25 million, the Pittsburgh Post-Gazette reported today. The deal calls for Quaker Steak, with 50-plus locations in the U.S., to retain its brand and possibly expand under the new owner. TravelCenters of America has more than 500 quick- and full-service restaurants in 43 states. TravelCenters has already made a deposit on the acquisition, the companies said, and agreed to offer jobs to “substantially all” of Quaker Steak’s current employees.

A&P was granted another 120 days to file its bankruptcy plan, shifting the deadline to mid-March, and it was also given the green light to sell the Ramsey Pathmark to an Italian-themed supermarket chain, in court hearings on Friday, NJ.com reported on Saturday. Attorneys for A&P told Bankruptcy Judge Robert Drain that the company still plans to close all of its remaining supermarkets by the end of November, but that it needs the additional time to sell its assets and present its plan for a chapter 11 reorganization. Ray Schrock, lead attorney for A&P, said that as of Friday the company had sold 119 stores to new owners, and 79 more supermarkets will be sold by Dec. 9. A&P is still seeking buyers for 57 supermarkets, Schrock said.

Energy Future Holdings Corp. took a major step forward Thursday in its drive to exit bankruptcy, when mutual fund company Fidelity Management & Research agreed to back the Dallas energy company’s chapter 11 plan, the Wall Street Journal reported today. A major holder of Energy Future debt, Fidelity will join the group attempting to buy Energy Future’s Oncor electricity transmissions business, Thomas Lauria, lawyer for advocates of the plan said at a hearing in the U.S. Bankruptcy Court in Wilmington, Del. The sale of Oncor is the centerpiece of Energy Future’s restructuring strategy. Money from the Oncor deal will be used to pay off some creditors. The opportunity to invest in a cash-producing, stable element of the Texas power infrastructure in a deal led by Hunt Consolidated Inc. has appeased other creditors. As described by Lauria, Fidelity is getting a little bit of both: cash from the buyout and a chance to invest in Oncor. The about-face by Fidelity, a former critic of Energy Future’s chapter 11 plan, could speed the end of a complicated and expensive bankruptcy proceeding.

Haggen, the Bellingham, Wash.-based grocery chain whose failed expansion effort landed it in chapter 11 protection, now plans to offer for sale its 32 “core stores” in Washington and Oregon, the Seattle Times reported today. The company had hoped to retreat to those successful stores after selling or closing about 130 others across five Western states, nearly all acquired earlier this year in a bold acquisition of 146 locations from Albertsons and Safeway as those two giants merged. But in a court filing this week Haggen sought permission to take bids for those 32 locations in its home markets. A financing agreement “requires Haggen to explore potential outside opportunities for all of its operations, including the core stores,” the company said in a statement.

Olga’s Kitchen, a Detroit-area brand that fell on hard times as dining habits changed and shopping malls declined, could be purchased out of bankruptcy by Schostak Family Restaurants, which already owns part of 11 Olga's locations that are not part of the bankruptcy, the Detroit Free Press reported today. Livonia, Mich.-based Team Schostak Family Restaurants bid $8.3 million for all 27 remaining Olga's restaurants. Those locations are currently up for grabs in an auction that runs through Monday. Schostak Family Restaurants already owns 50 percent of the 11 Olga's locations not in bankruptcy through a decade-old development agreement with the regional pita wrap chain. If Schostak wins the auction, it would gain full control of those 11 locations — plus ownership of the 15 restaurants that Olga's still runs on its own.