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A trustee representing the creditors of SemGroup Corp. sued Barclays Plc over a $143 million deal to offload the oil and natural gas pipeline company's commodities trading positions the month before it filed for bankruptcy in July 2008, Bloomberg News reported yesterday. SemGroup, which lost $2.4 billion shorting oil as prices rose in 2007 and 2008, emerged from bankruptcy in November 2009, according to a complaint filed on Monday. The trustee, Bettina Whyte, is seeking a return of the $143 million SemGroup paid Barclays to take over its trading book on the New York Mercantile Exchange. She claims that Barclays forced a "huge and unjustified" fee on SemGroup, with no benefit to the company or its creditors.

A funding vehicle once controlled by the now defunct mortgage lender Taylor, Bean & Whitaker Mortgage Corp filed for bankruptcy protection on Tuesday, and called for an examination of the federal regulator that oversees Freddie Mac, Reuters reported yesterday. Ocala Funding LLC filed for chapter 11 protection less than one month after a federal appeals court upheld the April 2011 conviction of former Taylor Bean Chairman Lee Farkas, who is serving a 30-year prison term for being what prosecutors called the mastermind of a $2.9 billion bank fraud. Ocala said in a court filing that it was established to buy Taylor Bean mortgage loans and then sell them to third parties, mainly Freddie Mac. Ocala said that from September 2008 until Taylor Bean collapsed in August 2009, Farkas and other Taylor Bean employees schemed to defraud it and its creditors by arranging to transfer about $805 million to Freddie Mac. In seeking an examination, Ocala asked for court permission to subpoena documents and question FHFA and Freddie Mac officials over "potential fraudulent transfer and other claims," with a goal of recovering more assets for creditors.

Fletcher International Ltd., a bankrupt hedge fund managed by the investment firm of Alphonse “Buddy” Fletcher, sued some of its own Cayman Islands-based funds to block liquidators from selling its assets, Bloomberg News reported yesterday. The lawsuit, filed in bankruptcy court on July 2, days after the fund's own chapter 11 bankruptcy, seeks to stop Ernst & Young, the official liquidators winding down related funds in the Cayman Islands. The liquidations come after three Louisiana pension funds sued to get their money back.

Barclays Plc challenged a ruling in its court fight with defunct brokerage Lehman Brothers Inc., saying that it has an "unconditional" right to $769 million that a federal judge denied and wants an additional $507 million in margin assets delivered immediately, Bloomberg News reported yesterday. The London-based bank, which bought Lehman Brothers Holdings Inc.'s North American business during the 2008 credit crisis, won as much as $5.5 billion in last month’s ruling. U.S. District Judge Katherine Forrest ordered brokerage liquidator James Giddens to pay money owed to Barclays and renounce his claim to margin assets that backed trading operations the bank took over from Lehman. Barclays now wants all of the remaining $1.3 billion in assets that are in dispute, according to an appeal to the U.S. Court of Appeals in Manhattan.

Goldman Sachs has been dealt another setback in its effort to overturn $20.5 million arbitration award stemming from the 2005 collapse of the hedge fund manager Bayou Group, the New York Times DealBook blog reported yesterday. A panel of the United States Court of Appeals for the Second Circuit on Tuesday upheld the award to the creditors of Bayou, who had accused Goldman of helping the fund perpetrate a Ponzi scheme. Goldman cleared trades for Bayou, and the unsecured creditors' committee filed its arbitration claim against Goldman in 2008.

U.S. District Judge Robert Wilkins on Tuesday ruled that the Securities Investor Protection Corp. is not required to begin a claims process in Texas for the victims of R. Allen Stanford’s $7 billion investment fraud, Bloomberg News reported yesterday. Judge Wilkins said that regulators failed to show that the 7,000 brokerage clients who invested in the Ponzi scheme are entitled to have their losses covered by SIPC, a nonprofit corporation funded by the brokerage industry. The Securities and Exchange Commission told SIPC on June 15, 2001, to start a process that could grant as much as $500,000 for each Stanford client -- the same maximum amount it offers in any case. After SIPC balked, the SEC for the first time sued the congressionally chartered group.

ABI's Commission to Study the Reform of Chapter 11 has released the names of nearly 130 corporate restructuring experts who have agreed to serve on one of 13 advisory committees to examine discrete current issues. The diverse group of professionals come from the backgrounds of law, finance and the judiciary. The lists of names can be found on the Commission's website. The thirteen advisory committees/study topics are: Administrative Claims, Critical Vendors and Other Pressures on Liquidity; Avoiding Powers; Bankruptcy Remote Entities, Bankruptcy-Proofing and Public Policy; Distributional Issues Under Plans; Executory Contracts and Leases; Financial Contracts, Derivatives and Safe Harbors; Financing Chapter 11; Governance and Supervision of Chapter 11 Cases and Companies; Labor and Benefits Issues; Multiple Enterprise Cases/Issues; Plan Issues: Procedure and Structure; Role of Valuation in Chapter 11 Cases; and Sales of Substantially all of the Debtor’s Assets, Including Going Concern Sales. The Commission is working to break down each study topic further into subtopics—a process intended to help advisory committees identify all potentially relevant issues and coordinate areas of potential overlap among study topics.

The Commission has announced a schedule of fall public hearings at major insolvency conferences, where interested members of the restructuring community can appear and provide testimony to the Commission or to one or more of the advisory committees. The hearings will be held at the NCBJ annual meeting on October 26, the TMA annual convention on November 3 and the Commercial Finance Association annual meeting on November 15. Other public hearing dates will be announced.

Photography pioneer Eastman Kodak Co. sued Apple Inc. to stop it from interfering with plans to sell a large patent portfolio, a significant part of its bankruptcy restructuring, Reuters reported yesterday. In a lawsuit filed on Monday in bankruptcy court, Kodak said that Apple wrongly claims to own 10 patents arising from work that the companies did together in the early 1990s. Privately held FlashPoint Technology Inc. also claims ownership through an assignment from Apple, which spun it off in 1996, and is also a defendant, Kodak said. The patents include technology that helps camera owners preview photographs on LCD screens.

Creditors say that tennis-racket maker Prince Sports Inc. is cutting too many corners as it heads toward a bankruptcy deal with Authentic Brands Group LLC, Dow Jones DBR Small Cap reported today. Brand developer Authentic bought Prince's $65 million top-ranking debt, positioning itself for a takeover in chapter 11. Instead of the bankruptcy court-supervised auction most companies in chapter 11 are required to at least attempt, the decision on who controls the Prince trademarks will be made in a "non-competitive, no bid process" that is allegedly designed to make sure Battle Sports Science LLC, the proposed licensee, faces no serious opposition, creditors contend.

A U.S. futures regulator said that he wants to see his agency hire its own attorney in Britain to help recover customer funds lost during MF Global's chaotic final days, Reuters reported on Friday. Bart Chilton, a member of the U.S. Commodity Futures Trading Commission (CFTC), said that he wondered whether attorneys hired in Britain, by a trustee liquidating the failed commodities brokerage, would effectively represent futures customers. "I believe we need to have our own counsel in the UK," Chilton said. "I'm no longer convinced that our interests are aligned, and out of an abundance of caution and concern that we are doing all that we can to protect customers' money, I think we should have our own UK counsel." James Giddens, the court-appointed trustee, estimates that MF Global clients have lost as much as $1.6 billion in funds, some of which is tied up in the United Kingdom.