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MModal Inc., the medical-transcription company indirectly controlled by JPMorgan Chase & Co., won court approval of the rough terms of a plan to reorganize and will seek final approval July 15 to exit bankruptcy, Bloomberg News reported yesterday. Bankruptcy Judge Robert Grossman yesterday approved MModal’s disclosure statement, which explains how much creditors will get. The reorganized company is projected to earn $57 million before taxes and other items this year and $71 million a year by 2017, enough to support its new debt load of about $320 million in secured debt, according to court papers. MModal, acquired by New York-based JPMorgan’s One Equity Partners in a $1.14 billion leveraged buyout in August 2012, filed for bankruptcy on March 20. The Franklin, Tennessee-based company listed assets of $626.8 million and liabilities totaling $876.3 million. MModal struggled to make payments on the debt as software and other products supplanted its transcription business, which converts health care providers’ dictation to text and generated more than 80 percent of revenue.

The YMCA of Metropolitan Milwaukee has filed for chapter 11 protection, WISN.com reported yesterday. The organization said it will sell a majority of its owned real estate to help pay down $29 million in debt. The group said it has budgeted earnings before interest, depreciation and amortization of $950,000 in 2014. The organization said that financial complications over the past few years, combined with declining membership, decreasing contributions and millions of dollars in deferred maintenance costs have made the current financial model unsustainable.

New York’s highest court yesterday weighed whether law firms that hire partners from dissolving firms should be obligated to help repay the dead firm’s creditors by turning over profits earned on work the new partners bring with them, the Wall Street Journal reported today. Law firm bankruptcy administrators have long argued that the so-called unfinished business doctrine makes profits from assignments that partners take to new firms a legitimate asset of the defunct firm, which can then be used to pay creditors. But partners at the nation’s top law firms say that client business isn’t a commodity that can be bought and sold and that they shouldn’t be punished for sticking with clients when a firm goes under. The issue came before the New York Court of Appeals after dueling appeals in federal court — stemming from the bankruptcies of Thelen LLP and Coudert Brothers LLP — left case law in New York unclear. Facing the two appeals, the Second U.S. Circuit Court of Appeals asked the New York court to look at the issue from a state law perspective.

Comcast SportsNet Houston, the city's struggling sports channel, has asked a judge to push back a key deadline in its chapter 11 case while its executives figure out how to turn around the channel, Dow Jones Daily Bankruptcy Review reported today. Attorneys for Comcast SportsNet Houston, which broadcasts Astros baseball and Rockets basketball games to fewer than half of the city's households, said in court papers that they need at least 30 additional days to propose an outline of its bankruptcy-exit plan.

Energy Future Holdings Corp. yesterday defended its plan to put nearly $9.9 billion of bankruptcy loans in place this week and said the financing is picking up support among critics, MarketWatch.com reported today. The Texas power company said it has made "significant progress in brokering a settlement" regarding concerns creditors have raised about a $4.475 billion loan to support operations at its Texas Competitive Electric division. According to the company, cutting down the size of the bankruptcy financing for Texas Competitive, which some creditors have suggested isn't a good idea, "given the volatility of the energy market and the highly favorable terms" of the loan. Lower-ranking creditors have said the Texas Competitive loan ties up too much of the company's scarce unpledged assets, signing away value that could be used to pay them instead.

The former Fisker Automotive Inc. appears headed for a peaceful end to its bankruptcy, having reached an accord with the official committee of unsecured creditors over terms of a cash-sharing plan, the Wall Street Journal reported today. Announced in a court filing yesterday, the agreement heads off the threat of a major clash next week, when the bankruptcy case of the former hybrid auto maker enters its final stages. China's Wanxiang Group bought the car-making operation at a bankruptcy auction, leaving $149.2 million worth of cash and stock for Fisker creditors. Fisker's creditor’s committee forced the auction after a fight with the company, which advocated a private deal with a company affiliated with Hong Kong billionaire Richard Li, an early Fisker backer.

A business founded by “American Sniper” Chris Kyle, who claimed to be the most lethal sniper in U.S. military history and who was killed on a Texas shooting range last year, has filed for bankruptcy ahead of an upcoming movie about his life, the Wall Street Journal reported today. The bankruptcy of Craft International LLC, which was filed on Friday, could sort out a messy ownership fight between Kyle’s widow, Taya, and investors owed more than $2.6 million. The Dallas company primarily trains police officers, SWAT teams and the military on how to handle “austere environments and situations,” according to its website. But it also sells merchandise with Craft’s skull-shaped logo surrounded by these words: “Despite what your Momma told you violence does solve problems.” The “American Sniper” movie, which is being directed by Clint Eastwood and stars Bradley Cooper as Kyle, is filming now and could put a valuable spotlight on the logo.

The Sbarro pizza chain is officially out of bankruptcy after entering into a plan that allowed lenders to swap $148 million in debt for control of the reorganized business, the Wall Street Journal reported today. The Long Island, N.Y.-based company, which has more than 800 restaurants around the world, was poised to get new owners under the plan, including distressed-debt investors Apollo Global Management, Babson Capital Management LLC and Guggenheim Investment Management LLC. The plan took effect on Monday, according to documents filed in U.S. Bankruptcy Court in Manhattan. Sbarro put its restaurants, which anchor many mall food courts, into chapter 11 protection on March 10, blaming its financial troubles on an "unprecedented decline in mall traffic" that made it difficult to repay its debt. Sbarro closed roughly 180 of its 400 restaurants in North America before filing for bankruptcy, enabling it to save roughly $82 million a year, according to court filings.

The debate over who deserves to profit from work that originated at a law firm that collapsed comes to a head on Wednesday when New York's highest court will hear arguments in cases stemming from the bankruptcies of Coudert Brothers LLP, which went under in 2005, and Thelen LLP, which closed in 2008, the Wall Street Journal reported today. A decision by the New York Court of Appeals will provide clarity into how much money, if any, should flow back to defunct firms' creditors, including those of the biggest U.S. law-firm failure ever, Dewey & LeBoeuf LLP. At issue is whether the estates of bankrupt law firms have stakes in so-called unfinished business, the assignments taken by partners to a new firm as their old firm dissolves. Bankruptcy administrators have long argued that the failing firms have valid claims. But partners at the nation's top law firms say that client business isn't a commodity that can be bought and sold. They say that clients have the freedom to choose counsel, and lawyers — and their new employers — shouldn't be punished for sticking with an assignment after a law firm collapses.

Coldwater Creek’s creditors are at a loss to understand why sales boomed in the wake of its bankruptcy filing, but it’s not a mystery to the former retailer’s target customers, the Wall Street Journal reported on Saturday. Coldwater Creek launched in the Midwest some 30 years ago and catered to mature, educated women. The line caught on among a crowd of people, including professional women, who didn’t have the time or patience to go from store to store to find comfortable classics. When Coldwater Creek shoppers found out the company was going under, they stocked up, according to Massachusetts attorney Alanna Cline, who identified herself as “a very satisfied and needy customer — notwithstanding the decline in quality and design over the past couple of years.” The prospect of saving a couple more bucks at going-out-of-business sales wasn’t worth the risk that favorite items would be sold out, it seems. “Fear and need” drove a run on the Coldwater Creek website, according to Cline.