%1

Fyre Festival was canceled shortly after concertgoers arrived at the failed music festival. Now, lawyers working on behalf of creditors want to scrutinize money festival organizers paid for performances and appearances that never occurred, WSJ Pro Bankruptcy reported. Bankruptcy Judge Martin Glenn of the U.S. Bankruptcy Court in New York has, according to a Jan. 3 order, given lawyers permission to serve subpoenas on talent agencies that attorneys believe were paid more than $1.4 million to get models and artists to promote, perform or show up at the much-hyped 2017 event in the Bahamas. The attempt to gain insight into these payments was made by a court-appointed bankruptcy trustee who is tasked with examining the company used to promote the event, Fyre Festival LLC. Creditors forced the company into bankruptcy in hopes that a court proceeding would reveal where their money went. Planned over two weekend and promoted as “the cultural experience of the decade,” concertgoers were instead greeted by a logistical fiasco that was abruptly canceled after photos of the unfinished event space, bad food and frustrated concertgoers went viral on social media.

After filing for bankruptcy last year, the owners of the Danforth Inn in Portland have sold the property to a boutique hotel chain for $1.7 million, the Bangor (Maine) Daily News reported. The nine-bedroom luxury inn located in Portland’s West End was sold on Friday to Lark Properties, which operates Lark Hotels, according to a statement from Raymond Brunyanszki and Oscar Veret, who have owned the inn since 2014. The Danforth Inn will be closed for the remainder of January and will reopen Feb. 1, according to a statement from Lark Hotels. During that time, existing Danforth Inn employees can apply to be hired by Lark Hotels. Guests who had reservations for the month of January will either be transferred to the Press Hotel in Portland or can push their stay to a date when the inn has reopened, according to Lark Hotels’ statement.

Russian Samovar Inc., a New York restaurant once co-owned by ballet legend Mikhail Baryshnikov and featured in the “Sex and the City” television series, has filed for bankruptcy, citing a $199,000 lease dispute, the Wall Street Journal reported. The restaurant and piano bar, a theater-district fixture patronized by performing arts professionals, theatergoers and high-rolling Russian elites, plans to remain open and reorganize through chapter 11, which it filed for on Monday in U.S. Bankruptcy Court in New York. The bankruptcy is “an emergency filing to prevent lease termination and subsequent eviction,” Gabriel Del Virginia, Russian Samovar’s lawyer, said yesterday. Russian Samovar’s chapter 11 petition lists one creditor, landlord Alvin Nederlander Associates Inc., which is owed $199,000 for a “disputed” unexpired lease.

With Sussex County, N.J., potentially facing up to a $26 million debt bomb as a result of Mountain Creek's defaulting on sewer payments to Vernon, negotiations aimed at heading off the resort's pending bankruptcy action are continuing, Mayor Harry Shortway said yesterday, the New Jersey Herald reported. But before county officials start pointing fingers at Vernon, he suggested the county needs to be held responsible for the failings not only of its $28 million solar initiative but also a regional 911 system that he said is costing taxpayers more than $1 million per year. With Mountain Creek's debt constituting roughly two-thirds of the more than $43 million in sewerage flow allocation from the Sussex County Municipal Utilities Authority that the township underwrote on the resort's behalf under a 2005 agreement between them, Vernon is continuing to make partial payments on the other third for the time being.

Tillman Fertitta — the billionaire owner of the Houston Rockets — invited Caesars Entertainment earlier this month to merge with his own gaming empire, which includes the Golden Nugget casino chain. But Caesars’ board — which includes reps from billionaire Leon Black’s Apollo Management and David Bonderman’s TPG — is expected to unanimously reject Fertitta’s deal as soon as this week, believing it would saddle the casino giant with too much debt, the <em>New York Post</em>. News of Fertitta’s overture last week sent Caesars’ shares soaring 18 percent over two days, leading it to close at $10.20 Friday, giving Caesars a market cap of $6.8 billion. That looks like a big bite for the Texas tycoon, whose net worth is estimated at just $4.5 billion. Caesars still has $9 billion in debt after emerging from bankruptcy a year ago, and Fertitta’s deal would add to that load, sources said.

Tilman Fertitta, the owner of the Golden Nugget casinos, has approached Caesars Entertainment Corp. about a possible merger, according to people familiar with the billionaire’s plans, Bloomberg News reported. The proposed deal would see closely held Golden Nugget acquired by its larger Las Vegas-based rival in a merger that values Caesars at about $13 a share. Revenue on the Las Vegas Strip has been tepid and Caesars, with a market value of $7.07 billion, disappointed shareholders this summer with a warning of tough conditions in the top U.S. gambling market. Under the plan proposed by Fertitta, who would become chairman and chief executive officer of the combined company, Caesars would sell the land and buildings associated with Landrys and Golden Nugget to a real-estate investment trust, said one of the people. Caesars would use some of that cash to repurchase its own shares, with Fertitta emerging as the largest single owner, the person said. Caesars has been led since 2015 by Mark Frissora, former chief executive officer of Hertz Global Holdings Inc. Many of the company’s largest shareholders are private equity funds such as Apollo Global Management and TPG, or distressed debt investors, that came aboard in a 2008 leveraged buyout or through a subsequent bankruptcy and restructuring of its largest division.

The disgraced organizer of the disastrous Fyre music festival in the Bahamas, an audacious scheme that defrauded investors and left hundreds of ticket buyers stranded on an island, was sentenced yesterday to six years in prison by a federal judge in Manhattan, the New York Times reported. The organizer, Billy McFarland, was also sentenced for running a sham ticket-selling business — but that fraud was run-of-the-mill compared with the Fyre Festival, which had been promoted by A-list social media influencers but imploded just as publicly on Instagram and Twitter. McFarland had promised an event with luxury accommodations and performances by bands like Blink-182. But the festival never took place, leaving attendees wandering unfinished sites on the island of Great Exuma in the Bahamas. In March, Mr. McFarland pleaded guilty to two counts of wire fraud after investigators concluded that he had defrauded investors in his company, Fyre Media, as well as a subsidiary that had promoted the music festival, resulting in $24 million in losses. Then in July, Mr. McFarland pleaded guilty to two more counts of fraud related to another company that he ran while out on bail that sold fake tickets to fashion, music and sports events and was said to have cost at least 30 victims a minimum of about $150,000.