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Houston Astros owner Jim Crane has sued Comcast Corp. accusing the cable company of fraud in selling him a stake in the "overpriced and broken" regional broadcast venture, Comcast SportsNet Houston, Dow Jones Daily Bankruptcy Review reported today. Comcast, which owns part of the regional sports venture, pushed it into bankruptcy in September, blocking a drive by Crane to force co-owner Comcast out of its spot as broadcaster. Comcast denied the charges of fraud in the lawsuit and said it would defend against allegations that the November 2011 sale of the Astros baseball team and more than 40 percent of the network to Crane was founded in "knowing misrepresentations" about the network's financial prospects.

Defense attorneys for two ex-leaders of Dewey & LeBoeuf said in court papers filed on Friday that unless a trustee’s lawsuit against them is halted in bankruptcy court, they will be forced to depose prosecution witnesses from the criminal case against them, Law.com reported yesterday. Alan Jacobs, the liquidating trustee overseeing the defunct law firm Dewey & LeBoeuf, is seeking to recover more than $21.8 million from former CFO Joel Sanders and former executive director Stephen DiCarmine in a clawback lawsuit in Southern District Bankruptcy Court, Jacobs v. DiCarmine, 13-01765. Earlier this month, Jacobs amended his complaint to add new claims for “actual intent” fraudulent transfers, incorporating details from the criminal indictment and the SEC complaint against former firm leaders, as well as the guilty pleas of seven former Dewey accounting employees. Jacobs said that the circumstances surrounding the firm’s payments to Sanders and DiCarmine reveal “several badges of fraud” and their employment contracts awarded them “exorbitant compensation and required, literally, nothing in return.” Now Sanders and DiCarmine are asking for a stay of the entire clawback suit until the criminal case in Manhattan Supreme Court is resolved.

Bankruptcy Judge Susan V. Kelley ruled on Friday that she does not have jurisdiction to approve the Archdiocese of Milwaukee's reorganization plan while key questions in a related lawsuit over $60 million it holds in trust for the maintenance of cemeteries are pending before the Seventh Circuit Court of Appeals, the Milwaukee Journal Sentinel reported today. The decision is a victory for the creditors committee, which had sought to block approval of the plan until the appellate judges rendered their decision — a process some have said could take a year. And it has forced the cancellation of the October confirmation hearings, at least for now — a setback for the archdiocese. At issue before the Seventh Circuit is whether forcing the archdiocese to put even $1 of the cemetery trust into the bankruptcy estate — and ultimately a settlement for clergy sex abuse survivors — would violate its free exercise of religion under the First Amendment and the 1993 Religious Freedom Restoration Act. Judge Kelley ruled earlier that it would not. She was overturned by U.S. District Judge Rudolph T. Randa, who found that cemeteries and their proper care play a central role in the Catholic belief in the resurrection of the body after death. The appellate court also is considering a request by the creditors committee that Randa be barred from hearing any issues related to the cemetery trust because of a conflict of interest.

Settlement talks may be in the works as the long-running trial over Nortel Networks Corp.'s billions winds to a close this week, Dow Jones Daily Bankruptcy Review reported today. Lawyers who have been battling for at least three years over how to divide $7.3 billion raised in the liquidation of the onetime telecommunications giant last week filed court papers that refer to discussions that could end the fighting. Nortel's various national factions have been caught up in a pitched battle over how to allocate the company's money among competing national units. Judges in Toronto and Wilmington are reviewing the bond interest briefs filed this week by Nortel Canada and Nortel U.S., an exchange sparked when it was suggested that getting a fast answer on the bond interest rate could advance the cash trial.

Vitamin and supplement seller Natrol Inc. yesterday asked a bankruptcy judge to allow it a shot at survival in spite of having veteran distressed lender Cerberus Business Finance LLC hot on Natrol's heels, demanding the ouster of the company's management, Dow Jones Daily Bankruptcy Review reported today. Bankruptcy Judge Brendan Shannon indicated that he would grant Natrol spending authority to preserve the business while the battle with the lender plays out.

Three former Dewey & LeBoeuf executives are asking a federal judge in Iowa to reconsider their request to put a civil suit by Aviva Life and Annuity Company on hold until a criminal case pending against them in New York is resolved, American Lawyer reported today. In its suit filed in 2012, Aviva claims that it lost 45 percent of its $35 million investment in the now-defunct firm's 2010 bond offering "as a result of false and misleading statements" by former Dewey chairman Steven Davis, former executive director Stephen DiCarmine and former chief financial officer Joel Sanders. All three men are currently facing criminal charges in their roles leading up to Dewey’s bankruptcy in May 2012. They are accused of lying to auditors, investors, creditors and colleagues for four years about the financial condition of the firm.
The defendants originally filed a motion to dismiss Aviva’s suit in 2013, arguing that the insurer had no standing in the case because it sold off its securities to Sea Port Group Securities for $19.2 million in the same month that Dewey went under. U.S. District Court Judge James Gritzer denied their motion in May.

The trustee appointed in Eastman Kodak Co.’s bankruptcy sued to recover payments of about $49.2 million that were made to Altek Corp. in the 90 days before the photography pioneer’s chapter 11 filing, Bloomberg News reported yesterday. Alan Halperin, acting on behalf of a trust created to liquidate some assets, is seeking to claw back any transfers made “to and for the benefit of” Altek, a Taiwan-based maker of digital cameras, according to a filing today in U.S. Bankruptcy Court in Manhattan. Kodak filed for bankruptcy in January 2012 after spending $3.4 billion on earlier attempts to turn its business around. By then, it had shed 47,000 employees since 2003, closed 13 factories that made film, paper and chemicals, and shut 130 photo laboratories.

Energy Future Holdings Corp., which has fought creditors over a proposed refinancing since its April bankruptcy filing, was sued by a trustee demanding a payment for holders of $2.2 billion in notes, Bloomberg News reported yesterday. Computershare Trust Co., the trustee, said Dallas-based Energy Future owes the junior lenders compensation for buying back the high-interest securities early, according to a court filing yesterday. The trustee accused Energy Future of trying to pull off in bankruptcy “what it could not accomplish outside of bankruptcy — refinancing the second-lien notes at lower interest rates without paying the redemption premium.” Energy Future is trying to exchange costly loans for lower-interest borrowings under an agreement struck with some creditors to reduce the debt load from its record $48 billion leveraged buyout in 2007. Creditors who didn’t sign up for the deal are fighting over special payments going to those that did, as well as redemption fees that they say they are due.

The U.S. Supreme Court handed Argentina a major setback in its long-running battle with a small group of determined creditors, heightening the risk the country will default for the second time in 13 years, the Wall Street Journal reported today. The justices yesterday rejected Argentina's appeal of a lower-court ruling that said that the country can't make bond payments until it compensates hedge funds that refused to accept restructured debt in the years following Argentina's 2001 default. Because of that earlier ruling, Argentina must decide by the end of the month whether to reach a deal with the holdouts or default on its next debt payment. Argentina's President Cristina Kirchner has refused to negotiate with the holdouts, calling them "vultures." But in an address Monday night, she said that Argentina wouldn't default on its restructured debt and would make its interest payment at the end of June. (Subscription required.)
http://online.wsj.com/articles/u-s-supreme-court-rejects-argentina-appe…

Click here to read the Supreme Court’s ruling: http://www.supremecourt.gov/opinions/13pdf/12-842_g3bi.pdf

For more on the Argentinian debt crisis, the Supreme Court’s ruling and what happens next, make sure to attend ABI’s Cross-Border Symposium on Friday in New York. The program will feature a keynote by James Millstein addressing the topic of Argentina’s debt situation. Millstein is the chairman and CEO of Millstein & Co. During his time as a managing director and the global co-head of corporate restructuring at Lazard, Millstein represented the Republic of Argentina in connection with the exchange offer for its international bond indebtedness. Register here: http://www.abiworld.org/CB14

Months after a trust fund established as part of Eastman Kodak Co.'s bankruptcy sued hundreds of businesses around the planet, including a slew in the Rochester, N.Y., region, a growing number of those suits have been settled or dropped, the Rochester Democrat & Chronicle reported today. The Kodak General Unsecured Creditors Trust filed a mountain of suits — roughly 750 — in U.S. Bankruptcy Court in January, seeking to claw back potentially hundreds of millions of dollars Kodak spent in the weeks prior to it filing for Chapter 11. About a third of the cases have been settled or dropped, according to U.S. Bankruptcy Court filings. The court documents give no details on the settlements. In Kodak's case, the trust — set up by the bankruptcy court — apparently is suing pretty much everyone who received a payment from Kodak in the 90 days leading up to its filing for bankruptcy, looking for "preferential payments." Any money the trust raises is to go to the unsecured creditors who were left with unpaid bills and invoices when Kodak filed for chapter 11 bankruptcy in January 2012.