A production and finance company behind Brad Pitt's upcoming thriller, "Killing Them Softly," has filed for bankruptcy, the Wall Street Journal reported today. Inferno International LLC, whose films include "The Women," "Killer Elite" and "The Kids Are All Right," filed for chapter 11 protection on Friday, according to court papers. The company's distribution arm, Inferno Distribution LLC, also filed for bankruptcy protection.
Morgan Stanley bought $320 million of Fontainebleau Las Vegas Holdings LLC debt as a Nevada court decides who will be paid first by the estate of the bankrupt casino company, Bloomberg News reported yesterday. Fontainebleau Las Vegas LLC and affiliates Fontainebleau Las Vegas Holdings LLC and Fontainebleau Las Vegas Capital Corp. filed for bankruptcy in Miami in 2009, listing debt of more than $1 billion each. New York-based Morgan Stanley made 67 trades in the company's claims, SecondMarket Holdings Inc. said yesterday in a report. Billionaire investor Carl Icahn bought the unfinished Fontainebleau Las Vegas casino resort for about $150 million in 2010. Lenders and contractors are fighting over that money, a dispute that is being decided by Nevada Supreme Court judges who heard arguments in June on who has priority claims.
Cliffs Club & Hospitality Group Inc., a network of luxury residential communities located in the Carolinas, has emerged from chapter 11 protection under the ownership of an investor consortium led by the Carlile Group, Dow Jones DBR Small Cap reported today. The Carlile consortium won the right to take Cliffs Club out of Chapter 11 protection earlier this year after no other bidders stepped forward to challenge it at auction. Under the plan, noteholders owed $73.5 million were slated to recover less than 87 percent.
U.S. Trustee Tracy Hope Davis is opposing the effort by Dynegy Inc and its Dynegy Holdings LLC unit to emerge from chapter 11 bankruptcy, saying that their reorganization plan may improperly limit the ability of third parties to bring liability claims, Reuters reported yesterday. Davis filed an objection to the plan on Monday in bankruptcy court, just nine days before a Sept. 5 hearing in which Dynegy hopes to win court approval of its reorganization. Dynegy this week said its plan had won overwhelming support from creditors holding about $3.5 billion of claims. But Davis, whose office oversees bankruptcy cases in the New York area, said that the power producer has not shown that its proposed "broad, non-consensual third party releases of liability" comply with bankruptcy law, and that such releases are proper only in rare circumstances.
Patriot Coal Corp. and its creditors and bankruptcy lenders oppose transferring the case to West Virginia from New York, pitting themselves against unions, insurers and the U.S. government, Bloomberg News reported yesterday. The United Mine Workers union and several insurers who have argued for the move to Charleston, W.V., have not proven that it would be more convenient for all creditors or lead to a more economical chapter 11 case, the creditors said in court papers filed on Monday. Patriot, one of the largest coal producers in the U.S., filed for bankruptcy in July. It was asked first by its union to move the case. The U.S. Trustee, an arm of the Justice Department that oversees bankruptcies, joined in the motion, saying the St. Louis-based company created two new units just before its bankruptcy with what appeared to be the sole purpose of avoiding other bankruptcy courts.
Creditors of power producer Dynegy Inc. and its Dynegy Holdings LLC unit voted overwhelmingly in favor of their joint bankruptcy reorganization plan, and the companies expect to emerge from chapter 11 shortly after the plan wins court approval, Reuters reported yesterday. Dynegy said Bankruptcy Judge Cecelia Morris had scheduled a Sept. 5 hearing to confirm the plan, which won backing from creditors holding about $3.5 billion of claims, more than 99 percent of the value that voted. The reorganization plan calls for Dynegy and Dynegy Holdings to merge, with creditors taking a 99 percent stake in the combined company, and shareholders getting a claim for the remainder plus warrants. Unsecured creditors would recover 59 cents to 89 cents on the dollar, and existing shareholders would recover nothing, court papers show.
Wilmington Trust Co. is taking aim at Capitol Bancorp Ltd.'s bankruptcy case, calling for the appointment of a creditor group to delve deeper into the bank-holding company's proposed route to reorganization, Dow Jones DBR Small Cap reported today. Capitol Bancorp, a struggling Michigan company that has community banks scattered across 10 states, sought bankruptcy protection earlier this month with a restructuring proposal already in hand. Wilmington Trust said in a court filing that only $17 million of some $151 million in holders of trust-preferred securities cast their votes on the reorganization plan, leaving 89 percent having not weighed in.
Homeowners with mortgages serviced by Residential Capital LLC want to form an official committee in the company's bankruptcy case, which would give them a louder voice in the company's complicated chapter 11 proceedings, Dow Jones Newswires reported yesterday. In court filing on Friday, a lawyer for the group of homeowners said they are concerned that state and federal settlements this year with mortgage servicers including ResCap's government-owned parent Ally Financial might not be enforced properly now that ResCap is in bankruptcy. The settlement, over borrower claims of improper foreclosure practices, offers billions of dollars in relief to many homeowners who either owe more than their homes are worth or were forced to sell their homes and move.
Two investment firms could walk away from the bankruptcy of solar panel maker Solyndra LLC with hundreds of millions of dollars in future tax breaks, the U.S. government said in court papers seeking more information on the arrangement, Reuters reported yesterday. Units of Argonaut Ventures and Madrone Partners could end up with "significantly more" than $500 million in tax benefits as part of Solyndra's bankruptcy, the Department of Energy and the Internal Revenue Service said in a bankruptcy court filing on Friday. Under the bankruptcy plan, the U.S. government is unlikely to recoup much of its $528 million loan to Solyndra. The government agencies asked the bankruptcy court to reject Solyndra's "disclosure statement," which describes its plan to repay creditors, unless the company provides more details on the tax benefits. Under the proposed plan, tax benefits such as "net operating losses" would be preserved for Argonaut, which is controlled by a foundation linked to billionaire George Kaiser, and Madrone. Under a 2011 restructuring, the two firms committed to investing $75 million to keep Solyndra afloat with the condition they would be repaid before the U.S. government.
The chief executive of Hostess Brands Inc. said that the troubled maker of Twinkies and Wonder Bread will immediately liquidate if union members do not sign on to the final labor deal it has offered them, Dow Jones Daily Bankruptcy Review reported on Friday. Gregory Rayburn, a restructuring professional who took the helm of iconic baking company earlier this year, said that a contingency plan is already in place to shut down operations and sell the company's brands, plants and other assets if members of its two biggest unions do not ratify the new contracts. Hostess last week announced that the Teamsters union, which represents 7,500 of Hostess's 19,000 employees, had agreed to vote on a proposal that calls for some "deep" concessions and contemplates the possible sale of Hostess's Merita bread and bakery business, based in the Southeastern U.S.