Urban radio-station operator Inner City Media Corp. is seeking to keep control over its chapter 11 case for another two months as awaits regulatory approval to sell its assets, Dow Jones DBR Small Cap reported today. In court papers filed on Tuesday, the company asked for an extension through Sept. 4 to file a plan detailing how it will repay its creditors. A hearing on the company's request is scheduled for July 17.
Eastman Kodak Co. failed to persuade a judge to rule that Apple Inc. has no interest in a group of patents Kodak is putting up for sale as part of its bankruptcy reorganization, Bloomberg News reported yesterday. Bankruptcy Judge Allan Gropper said that the dispute could be resolved through a lawsuit in Kodak's chapter 11 case. "An adversary proceeding will permit the parties to raise issues in an orderly and expeditious fashion and preserve all of their just rights," Judge Gropper said. Kodak is planning to sell patent assets and said in court papers that it needed the order to aid in the sale. Apple has claimed ownership of the patents and is trying to "delay and derail" the sale effort, Kodak said.
LightSquared Inc. reached a final agreement to use lenders' cash collateral after saying that it might have to liquidate without the deal, Bloomberg News reported yesterday. The accord gives the maker of wireless broadband technology enough money to fund operations until September 2013, Matthew Barr, a lawyer for LightSquared, told Bankruptcy Judge Shelley Chapman yesterday. As part of the deal, LightSquared agreed to pay the lenders $6.25 million a month and let them return to court to move to end the use of cash collateral, Barr said. The lenders, which own $1.1 billion of debt in LightSquared's "LP" unit, will allow the company to use as much as $190 million in collateral, Barr said.
Allied Systems Holdings Inc. yesterday won interim court approval of $20 million worth of financing, Dow Jones DBR Small Cap reported today. The company's immediate need for operating cash is a matter on which all top lenders agreed as the car-hauling business slumps in July with manufacturers shut down in preparation for switching over to the next year's models.
Eastman Kodak Co. filed a motion on Monday seeking approval of bidding procedures for bankruptcy auction of its Digital Capture and Kodak imaging Systems and Services patent portfolios, which together comprise more than 1,100 patents, Reuters reported yesterday. Kodak's motion outlines a sale process such that only the winning bidder and the successful bid amount will be publicly announced at the end of the auction. Kodak, now in bankruptcy, expects the motion to be heard by the court on July 2, with the auction being held in early August and the winning bidder being announced by August 13.
Residential Capital LLC received another round of court approvals yesterday that will enable it to operate in bankruptcy, while competing bidders stepped in for its mortgage loan and servicing businesses, Reuters reported yesterday. Bankruptcy Judge Martin Glenn gave final approval to ResCap to allow it to continue paying employees and using its cash to pay other bills. Judge Glenn also said that he still expects to be presented with ResCap's proposed procedures for the asset sales at a June 18 hearing unless the company decides to delay the request. ResCap filed for bankruptcy last month with a plan in place for Nationstar Mortgage Holdings, owned by Fortress Investment Group, to make a $2.4 billion minimum offer for the mortgage servicing assets. Ally Financial, the parent company of ResCap, also agreed to buy a group of ResCap mortgage loans for $1.4 billion. Ally is not in bankruptcy.
Allied Systems Holdings Inc. and 18 subsidiaries, including Allied Automotive Group Inc., Axis Group Inc., and Allied’s Canadian units, on June 10 filed for chapter 11 protection, the Atlanta Business Chronicle reported yesterday. The Decatur, Ga.-based automotive transportation company said that its majority lenders pledged to provide up to $20 million in debtor-in-possession financing to support the company's operations during its voluntary restructuring. Allied Holdings Inc. previously filed for chapter 11 protection in July 2005 and emerged as Allied Systems Holdings Inc. in May 2007. Since then, the company's sales have been hurt by the reduction in vehicle production and sales due to the global economic crisis that began in 2008. Also, the company said that it and its majority lender Yucaipa have been in litigation with certain minority lenders since 2009. Two of those lenders filed involuntary chapter 11 proceedings against Allied on May 17, 2012.
Eastman Kodak Co.'s effort to draw interest in the sale of its digital patent portfolio is flagging, complicating the 132-year-old photography pioneer's chances of emerging from bankruptcy court, the Wall Street Journal reported. The company has not been able to attract a stalking-horse bidder, and as a result, Kodak is preparing to hold a "naked" auction for the patents, one in which no suitor makes an opening bid before the auction begins. The patent sale is an essential step in the turnaround of the company, which had a difficult time reducing its reliance on film sales and is continuing a risky transformation to compete against bigger rivals such as Hewlett-Packard Co. in the market for printers.
Bankruptcy Judge Eric L. Frank said in a court hearing yesterday that he would approve a timeline to bring the Philadelphia Orchestra Association before the court again on June 28 for a confirmation hearing on the orchestra's reorganization plan, the Philadelphia Inquirer reported today. Because of the "aggressive scheduling," Judge Frank said that any objections to the orchestra's reorganization plan would have to be heard at the confirmation hearing, which could take a day or two. The judge, after reviewing a list of procedural concerns, said he was approving the quicker-than-usual schedule in recognition of the case's notoriety, suggesting that any interested parties were already aware of the bankruptcy. Ballots approving or objecting the plan are being sent to creditors and are due back by June 26.
U.S. Trustee Tracy Hope Davis said in court papers filed yesterday that Residential Capital LLC needs to do more to ensure it is protecting consumer privacy for homeowners under bankruptcy law in the sales of its mortgage loan and servicing businesses, Reuters reported yeterday. Davis also challenged the potential break-up fee and other parts of an auction process for those businesses, saying that they would discourage bidders from participating. ResCap, the mortgage unit of Ally Financial, filed for bankruptcy in May with a plan to sell its mortgage servicing business for about $2.4 billion to Nationstar Mortgage Holdings, owned by Fortress Investment Group. It also plans to sell some mortgage loans to Ally for about $1.4 billion.