A bankruptcy court has denied both motions filed by El Paso Children's Hospital and UMC Health System, KFOX14.com reported yesterday. Children's Hospital pushed for a time extension to come up with a recovery plan, while UMC wanted to end the time Children's has now and move forward with its recovery plan. Children's has until Sept. 15 to come up with a plan and 60 days after filing to have it confirmed by both parties.
Everett Ridge Winery and Vineyard, one of the few vineyards in the U.S. owned by an African-American family and whose award-winning wines have been served at White House dinners, has filed for chapter 11 bankruptcy amid a dispute with its bank, Dow Jones Daily Bankruptcy Review reported today. Located in Northern California's Sonoma County, the winery has been trying to negotiate with its lender for several years to no avail, said Stephen Sterling, one of four brothers that owns the business with their parents. The bank loan requires a payment of nearly $1 million to refinance, Sterling said, leaving Everett Ridge and sister winery, Esterlina Vineyards & Winery LLC, with few options.
Optim Energy LLC will pay Blackstone Group LP $5 million to settle their fight in the Texas power-plant operator’s bankruptcy case in exchange for Blackstone dropping its appeal of Optim’s court-approved plan to exit bankruptcy, the Wall Street Journal reported today. Optim said in a Wednesday court filing that the deal will stop all litigation between the sides and will serve as the backbone to a liquidation plan for the six bankrupt Optim entities that weren’t included in a broader reorganization plan approved by a judge late last month. That proposal kept Optim in the hands of Bill Gates’s private investment firm, Cascade Investment. Crucially, Blackstone will drop a $190 million claim it had made for so-called rejection damages. A hearing on the settlement had been scheduled for Aug. 19. Blackstone won’t officially drop its appeal to the broader restructuring until the approval of the liquidation plan for the six entities.
In the ongoing trial against three former Dewey & LeBoeuf LLP leaders, it’s been hard to tell at times who, exactly, is being labeled as the victim, according to a Wall Street Journal Bankruptcy Beat blog post yesterday. As the Manhattan district attorney’s office pointed out in its 2014 indictment against three ex-law firm leaders, Dewey’s collapse “forced thousands of people out of jobs and left creditors holding the bag on hundreds of millions of dollars owed to them.” The firm’s May 2012 bankruptcy hurt Dewey’s former employees and lawyers, including retirees who were suddenly faced with declining prospects for their future income. Dewey’s partners were asked to contribute large sums of money through the bankruptcy to pay creditors, even though many felt the firm actually owed them money. But the alleged crimes the D.A. says Dewey’s former chairman, Steven Davis, ex-chief financial officer, Joel Sanders, and former executive director, Stephen DiCarmine, committed aren’t really about what led the firm to collapse. Instead, prosecutors allege the three conspired to hide the true nature of the firm’s precarious financial condition from its banks and auditors, which led the banks to continue lending Dewey money and convinced a group of insurance companies to buy into a 2010 bond offering floated by the firm. All three deny wrongdoing.
A&P has asked a bankruptcy court judge to set aside two key union provisions — bumping rights and full severance pay — after reaching a negotiation impasse with labor groups, USA Today reported today. The supermarket wants to completely eliminate bumping rights, saying that the administrative burden and costs associated with allowing workers to do that are too high and undesirable to would-be buyers of its stores. Bumping rights allow employees who work the longest for the company and at a store slated to close to take the job of a less senior worker at a supermarket that will continue to operate. The other sticking point is the amount of severance pay A&P will pay and when, the documents filed late Tuesday indicate. The supermarket has proposed paying employees who will lose their jobs as part of the bankruptcy 25 percent of the severance they are entitled to on a "timely basis" with a maximum cap of $10 million for all workers. The rest of the severance would be paid later, depending on how much remains after the stores have been sold and what other A&P creditors are due as part of settling the bankruptcy case.
Gospel Light Publications, known for its Sunday school and vacation Bible school curricula, filed for bankruptcy with plans to sell its assets, the Wall Street Journal reported today. The Christian media company, founded in 1993, blamed the filing on “a number of unanticipated occurrences during the last nine months” as well as a “long-term slowdown in the Christian publishing market, court papers show. Those unplanned-for events include the bankruptcy filing of one of its biggest customers, the Family Christian retail chain. Gospel Light said the filing forced it to write off $143,000 in expected income. With current business conditions not promising, Gospel Light said that it began looking for buyers this spring. Those efforts yielded a $175,000 offer for its ZDL unit, which publishes Christian literature and provides consulting services in China, from the company’s current minority owner, Pacific Resources International LLC. Pacific’s offer, which is subject to bankruptcy-court approval, would buy out Gospel Light’s majority stake in ZDL.
The FBI will pay for and take over more than 100 boxes of documents that Tampa-based Creative Recycling Systems abandoned in a storage facility as part of the e-waste recycler's chapter 7 bankruptcy case, the Tampa Bay Business Journal reported yesterday. In a bankruptcy court hearing yesterday, attorney Terri Thomas from Fisher & Sauls, representing storage company Stevens & Stevens Inc., said that the FBI subpoenaed the documents on Friday. Bankruptcy Judge K. Rodney May authorized Thomas, on behalf of the storage company, to release the documents to the FBI. An earlier filing by Michael Markham, the attorney representing Creative Recycling's bankruptcy trustee, indicated sensitive documents abandoned by the company at the storage facility could be of use to "governmental agencies with open investigations of the debtors."
Executives with the struggling St. Michael's Medical Center in Newark, N.J., filed for bankruptcy protection on Monday, with officials blaming uncertainties surrounding the state's long review of the proposed sale of the facility, NJ.com reported yesterday. "We've done everything the state has asked us to do," said David Ricci, the hospital's CEO. "After two and a half years, it would appear we're no further along than when we started." The bankruptcy move was done so the hospital will continue to have enough money on hand until the expected sale to Prime Healthcare Services, a for-profit company out of California. Employees and patients should not notice any change, Ricci said. "The state remains committed to the health and well-being of Newark residents," said Donna Leusner, spokeswoman for the N.J.Department of Health. "The department has taken a reasonable and deliberative approach as it always does with certificate of need applications. Having completed multiple rounds of questions, it remains under review." She declined to provide any timetable for when that review would be concluded. Read more.
West Virginia environmental regulators say that Patriot Coal's bankruptcy plan would leave the company with no assets to cover hundreds of millions of dollars in mine pollution cleanup, the Associated Press reported yesterday. In a bankruptcy court filing on Monday, attorneys for the Department of Environmental Protection (DEP)wrote that Patriot's plan would expose people to public health and safety risks. Patriot wants to close a proposed partial sale to Lexington, Kentucky-based Blackhawk Mining LLC. DEP attorneys said the plan appears to favor New York hedge funds and leave little to no ability for Patriot to pay to reclaim land and treat acid mine drainage and other water pollution. The plan also is opposed by the United Mine Workers of America because Patriot wants a judge to reject its collective bargaining agreement.
Energy Future Holdings Corp.'s deal to get out of bankruptcy fast was met with a barrage of criticism Tuesday from creditors who say they'll be left holding the bag if the deal at the heart of the turnaround falls through, Dow Jones Daily Bankruptcy Review reported today. Unveiled on Monday, the Dallas energy company's new bankruptcy plan is built around the $12.1 billion sale of its stake in Oncor, a cash-generating, regulated transmission business, to investors including Hunt Consolidated Inc. and investors including junior creditors from one of its two main divisions, the so-called "T-side" of the company. Unsecured creditors from Energy Future's other main division, the "E-side," attacked the deal at a court hearing Tuesday, saying it's no more than a "free option" to buy Oncor that leaves E-side creditors with the risk the deal will fail. Energy Future filed for chapter 11 bankruptcy protection in April 2014 with $42 billion in debt to resolve. The proposed takeover of Oncor is billed as a peaceful and speedy outcome to a bankruptcy that has been marked by contention.
