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The next challenge for GM amid its recall of 2.6 million vehicles after years of inaction is how to deal with hundreds of injury claims that the company has refused to discuss or characterize, the New York Times reported today. Some experts predict the cost to the company could run into the billions of dollars, exceeding the payouts related to deaths linked to the defect. Kenneth R. Feinberg, the victim-compensation expert hired by the company, is nearing the final stages of an elaborate process to determine who is eligible for payments and for how much. His plan, which is expected to be made public in the next two weeks, is seen as critical to the company’s ability to move beyond an issue that has prompted numerous investigations, congressional hearings, a $35 million federal penalty and withering public criticism. While it will not come cheap, getting the payment plan right is crucial. Too generous and it could slow the automaker’s comeback from bankruptcy; not generous enough and victims will seek justice through lengthy and costly court battles, further dragging out the company’s turmoil.

Atlantic City's bankrupt Revel Casino Hotel has received court approval to borrow $23.9 million that it said would keep the 1,400-room resort operating for the coming month as it scrambles to find a buyer, Reuters reported on Friday. Revel filed for chapter 11 protection on Thursday afternoon and rushed to court early on Friday for a slew of court orders that it said were vital to pay its 3,140 employees, soothe nervous vendors and honor programs that provide gamblers with key perks. "The reality of the Revel situation today is that Revel has lost this year alone $75 million," John Cunningham, a White & Case attorney who represents the casino, told Judge Gloria Burns. "Even in peak summer season, Revel loses $2 million a week and relies on borrowed funds." The loan is being provided by a unit of Wells Fargo, a creditor of the hotel, and Revel will return to court on July 11 and could seek to increase the amount it borrows to $41.9 million.

Brookstone Holdings Corp. will go before a bankruptcy judge this week to seek approval of its bankruptcy exit plan, the Wall Street Journal reported on Saturday. The centerpiece of the retailer’s plan is a $174 million bid to buy the company from Sailing Innovation US Inc. — a collaboration between Chinese investment firm Sailing Capital Overseas Investment Fund LP and Chinese conglomerate Sanpower Group, with a financing commitment from GE Capital. The consortium’s bid trumped a $146.3 million offer by an affiliate of Spencer Spirit Holdings Inc., the parent of the Spencer’s and Spirit Halloween retail chains, which had served as the lead bidder at a June 2 auction. Under the current plan, Brookstone’s unsecured creditors will receive at least $1.25 million, plus a chance to collect as much as $1.5 million more depending on how much money comes in from the sale. The plan also proposes to pay off the company’s approximately $51 million in bank loans with a loan provided by bondholders funding the restructuring.

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.

Kid Brands Inc., which designs and makes infant bedding, furniture and toys sold under brands including Carters and Graco, filed for bankruptcy protection with a plan to sell its assets, Bloomberg News reported yesterday. The East Rutherford, N.J.-based company listed assets of $32.4 million and debt of $109.2 million in chapter 11 papers filed on Wednesday. The board’s decision to sell “is in the best interests of the company and its stakeholders” and followed a review of strategic and financing alternatives, Kid Brands said today in a statement. Kid Brands will seek approval of $49 million in debtor-in-possession financing from existing lenders Salus Capital Partners LLC and Sterling National Bank so it can continue to operate in bankruptcy, according to the statement. Units that sought court protection were Kids Line LLC, LaJobi Inc., Sassy Inc. and CoCaLo Inc. Affiliates I&J HoldCo Inc. and RB Trademark Holdco LLC also filed. The case is In re Kid Brands Inc., 14-bk-22582, U.S. Bankruptcy Court, District of New Jersey (Newark).

The planned demolition of a chemical-storage facility at the site of a January spill that tainted West Virginia’s water supply recently faced an unexpected setback — heavy rain, the Wall Street Journal reported today. The chief restructuring officer of Freedom Industries Inc., the now-bankrupt company that owns the site of the spill, said in a Tuesday bankruptcy filing that potentially chemical-laced water from the Etowah River Terminal facility flowed into the nearby Elk River on two consecutive days last week. Mark Welch, Freedom’s chief restructuring officer, blamed the improper water discharge on “the combination of heavy rainfall and the failure of those responsible for the site to follow established protocols.” Those failures include not having any employees on the scene at the time of last Thursday’s downpour and pumps that didn’t activate when they were supposed to. Despite taking action Friday morning, more water overflowed into the river during another storm that evening, Welch said. The West Virginia Department of Environmental Protection issued notices of violation for the seepage, Mr. Welch said. The leaked water is still being tested by the department to see if it contained unhealthy traces of chemical compounds.

Momentive Performance Materials Inc., a maker of silicones and quartz products owned by Leon Black’s Apollo Global Management LLC, won court approval to put the rough terms of its bankruptcy plan to a creditor vote, Bloomberg News reported yesterday. Bankruptcy Judge Robert Drain yesterday approved the company’s disclosure statement outlining its reorganization. Momentive had sought to resolve three creditor lawsuits on an accelerated schedule, leading up to a five-day trial that would confirm a plan by Aug. 22. The judge said that there was no need to hold up a vote just for the lawsuits, while suggesting that a trial on final plan approval be delayed to Sept. 14.

American Apparel warned yesterday that the abrupt ouster of controversial CEO Dov Charney may pitch the company into bankruptcy by triggering defaults on two outstanding loans, the Los Angeles Times reported today. In an SEC filing, American Apparel said that the board's move to terminate Charney may trigger defaults under credit agreements with Lion/Hollywood and Capital One Business Credit Corp. A default "could cause us to become bankrupt or insolvent," the retailer told the Securities and Exchange Commission. Any acceleration on debt payments "would have a material effect on our liquidity, financial condition and results of operations." As of March 31, American Apparel owed Lion/Hollywood $9.9 million, a loan that matures in 2018, according to filings. The company also owed nearly $30,000 to Capital One in a revolving credit facility. The company is seeking a waiver from the lenders to prevent any default but warned that it has "no assurance" one will be granted on terms on the company can accept, if at all. American Apparel said the loan agreement with Lion/Hollywood specifies that if Charney ceased to be CEO, the lenders can declare all outstanding obligations to be immediately due. American Apparel says that misconduct led to founder Dov Charney's ouster.

Atlantic City’s Revel Casino Hotel warned its staff yesterday that it will shut down this summer if a buyer can’t be found in bankruptcy court, the Asbury (N.J.) Park Press reported today. Revel said that it is seeking a buyer for the struggling $2.4 billion casino, but can’t guarantee one will be found. If not, employees could be terminated as soon as Aug. 18, Revel said in the letter. The company also said that it plans to stay open while it searches for a buyer, operating as usual, honoring player comps and paying employees and vendors. Shortly after distributing the letters, Revel filed a chapter 11 petition with the federal bankruptcy court, its second in as many years. The casino said that it hopes to find a buyer quickly.