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Bank of New York Mellon Corp.'s victory in a lawsuit challenging its $312 million lien on the assets of bankrupt Sentinel Management Group Inc. was canceled without explanation by a U.S. appeals court, Bloomberg News reported yesterday. A three-judge panel of the U.S. Court of Appeals in Chicago on Nov. 30 withdrew its prior ruling affirming the lender's entitlement to the lien in a two-sentence decree. "The opinion of this court issued on Aug. 9, 2012, is withdrawn and the judgment is vacated," a three-judge panel of Daniel A. Manion, Ilana Diamond Rovner and John D. Tinder said. "This appeal remains under consideration by the panel." After the Northbrook, Ill.-based cash-management firm filed for bankruptcy in 2007, liquidation trustee Frederick Grede sued the New York-based bank alleging that its employees knew Sentinel was improperly using investor assets as collateral for its own line of credit and sought to disallow or subordinate BNY's lien. Following a 2010 trial, U.S. District Judge James B. Zagel in Chicago rejected Grede’s claims. After Manion, Rovner and Tinder upheld that decision, Grede’s lawyers petitioned for a rehearing by the full court.

Russian oil giant OAO Lukoil Holdings has mounted a defense against accusations that it looted a U.S. gas station operation that later landed in bankruptcy, denying, among other things, that it put up $25 million to rid itself of the stripped-down remnants of Getty Petroleum Marketing Inc., Dow Jones DBR Small Cap reported today. Landlord Getty Realty Corp. reclaimed the gas stations and is attempting to rebuild the business, but it is also financing the lawsuit against Lukoil in an effort to collect back rent.

More than six months have elapsed since Dewey & LeBoeuf LLP sought chapter 11 bankruptcy protection amid an exodus of partners, accusations of mismanagement and lenders' refusal to extend credit to the debt-laden law firm, but the finger-pointing over who is to blame for Dewey's demise continues, the Wall Street Journal reported yesterday. A hearing yesterday featured a motion by Dewey's unsecured creditors seeking standing to pursue mismanagement claims against the firm's three top managers, former chairman Steven Davis, former executive director Stephen DiCarmine and former chief financial officer Joel Sanders. The intent is to recoup money from a $50 million insurance policy held by the firm. While Davis, who has yet to appear in court, does not oppose that motion, he "denies that he engaged in any wrongdoing and disputes the allegations," according to a limited objection filed last week by his lawyers.

The trustee unwinding Lehman Brothers Inc. has reached a deal with the failed investment bank's German affiliate to cut more than a billion dollars in claims by more than half, the Wall Street Journal reported today. In a court filing yesterday, Lehman brokerage trustee James W. Giddens said that German affiliate Lehman Brothers Bankhaus AG can assert a claim of $600 million against the trustee, down from the $1.35 billion Bankhaus originally wanted. Earlier this month, the trustee reached a deal with Citigroup Inc. that ends a long-running legal fight over more than $1 billion Lehman deposited at the bank to cover foreign exchange trades the same week it filed for bankruptcy.

JPMorgan Chase & Co., the biggest U.S. bank by assets, won a New York appeals court ruling upholding the dismissal of a lawsuit by the defunct commodities fund Amaranth Advisors LLC, Bloomberg News reported yesterday. Amaranth collapsed in 2006 after losing $6.6 billion on natural gas trades. The fund sued New York-based JPMorgan in 2007 in state court in Manhattan, alleging that bank executives helped cause its demise by sabotaging a bailout by Citadel Investment Group LLC.

The California Public Employees’ Retirement System (CalPERS) is seeking to sue bankrupt San Bernardino over missed pension payments, the second potentially precedent-setting fight the fund picked with a California city this year, Bloomberg News reported yesterday. San Bernardino cannot use the Bankruptcy Code to justify its failure to make at least $5 million in payments, CalPERS, the biggest U.S. public-employee pension fund, said in court papers filed yesterday. The motion relies on arguments the fund is also making in the bankruptcy of Stockton, Calif.

Government attorneys say that failed battery maker A123 Systems Inc. needs the government's consent in order to sell its assets, the Associated Press reported yesterday. The Justice Department told a bankruptcy judge on Tuesday that any sale of A123's assets must protect the government's interests. The Department of Energy gave the Waltham, Mass., company a $249 million grant three years ago. A123, which makes lithium ion batteries for electric cars, grid storage and commercial and military applications, is in the process of selling its assets. The DOJ says those assets include some $120 million that was not handed over yet under the DOE grant, A123's cost-sharing obligations under federal assistance programs, and property and equipment purchased with government funds.

Vitro SAB, the Mexican glassmaker that has been fighting hedge fund Elliott Management Corp. and other creditors over its restructuring, lost an appeals court bid to enforce its bankruptcy plan in the U.S., Bloomberg News reported yesterday. The U.S. Court of Appeals in New Orleans ruled against Vitro today and upheld a bankruptcy court ruling that denied enforcement of the reorganization, a result that Vitro had warned would create "chaos" for the company. "Vitro cannot propose a plan that fails to substantially comply with our order of distribution and then defend such a plan by arguing that it would suffer were it not enforced," the court said. Vitro was appealing a decision by Bankruptcy Judge Harlin DeWayne Hale in June that handed a victory to holders of Vitro’s $1.2 billion in defaulted bonds. Hale refused to grant enforcement of Vitro's Mexican bankruptcy plan, saying that it was contrary to U.S. policy.

A group of former MF Global customers on Monday asked a court for permission to subpoena the commodities broker's executives, including former CEO Jon Corzine, who was blamed in a congressional report this month for MF Global's collapse, Reuters reported yesterday. The Commodity Customer Coalition, an advocate for trader customers who lost money when MF Global went under, is seeking to subpoena Corzine, Chief Financial Officer Henri Steenkamp, Chief Operating Officer Bradley Abelow and others, according to court papers filed yesterday. While Corzine has stepped down, some executives remain at the company, assisting in its wind-down. Abelow, the highest-ranking executive still at the firm, just last week gave his notice and is leaving at the end of the week.

Six months after seeking bankruptcy protection amid the largest law firm collapse in U.S. history, Dewey & LeBoeuf has finalized a plan designed to repay creditors a portion of more than $600 million in total debt while liquidating the remnants of what was until earlier this year a 1,300-lawyer enterprise, the American Law Daily reported today. Dewey’s official chapter 11 plan and disclosure statement includes information on the successful execution of a so-called partner contribution plan with roughly 400 former Dewey attorneys that is expected to yield $71.5 million for the estate. Most of that sum is earmarked for Dewey’s secured creditors, a group that includes lead Dewey lender JPMorgan Chase and, according to Dewey's filing, is owed a combined total of $261 million. The estate proposes in court filings to treat an additional $100 million originally listed as secured debt as unsecured debt instead. Companies that entered property or equipment leases with Dewey have filed another $44.5 million in secured debt claims, the filings say.