%1

Total bankruptcy filings in the United States decreased 12 percent in the first calendar quarter (Jan. 1 - March 31) of 2014 from the same period in 2013, according to data provided by Epiq Systems, Inc. Bankruptcy filings totaled 231,647 in the first quarter of 2014, down from the 263,635 filings registered in the first calendar quarter of 2013. Total commercial filings for the first three months of 2013 were 9,048, representing a 22 percent decrease from the 11,611 filings during the same period in 2013. The 222,599 total noncommercial filings recorded in the first calendar quarter of 2014 represented a 12 percent decrease from the 2013 total of 252,024. For the full statistical release, please click here: http://news.abi.org/press-releases/first-quarter-bankruptcy-filings-fal…

The City of Tucson, Ariz., will get $5.5 million in a settlement with W.R. Grace & Co. after a 12 year legal battle, LegalNewsline reported yesterday. Grace & Co. allegedly used asbestos products when fireproofing several city buildings during construction. Grace & Co., a specialty chemicals and materials company employing 6,500 people worldwide, and 61 affiliates voluntarily filed a chapter 11 protection in the U.S. Bankruptcy Court for the District of Delaware in April 2001. The cases were consolidated for administration purposes, leaving Grace with the role of operating their businesses and managing their properties as debtors in possession. After 13 years, Grace & Co. emerged from bankruptcy protection in February when its reorganization plan became effective, establishing two independent trusts to compensate asbestos personal injury claimants and cleanup efforts. Tucson will receive the award as its share of the Grace & Co. federal bankruptcy settlement.

Select Staffing, which provides temporary staffing services in a variety of industries, filed for chapter 11 protection yesterday after reaching a restructuring deal with its lenders, Dow Jones Daily Bankruptcy Review reported today. The family-owned company is seeking a quick restructuring by way of a pre-packaged chapter 11 plan, for which it has already secured the support of many of the lenders who would own the reorganized company. The plan would raise $225 million in new equity capital and $470 million in new debt to pay its creditors and continue funding its operations.

Textbook publisher Cengage Learning has ended its nine-month bankruptcy, emerging from chapter 11 after reducing its $5.8 billion debt by more than two-thirds, Reuters reported yesterday. Stamford, Conn.-based Cengage said that it cut $4 billion in debt and secured $1.75 billion in new loans to fund its bankruptcy exit. Created in a leveraged buyout led by Apax Partners in 2007, Cengage had been in bankruptcy since July, when it filed with a pre-packaged restructuring in place. Apax, along with Omers Capital Partners, bought Cengage for $7.75 billion from Thomson Reuters Corp., the parent of Reuters. Thomson asserted a $1.46 million unsecured claim against Cengage in its bankruptcy, but Cengage assumed the contract on which the claim was based, meaning Thomson will receive full payment, Cengage said.

The chief executive of Japan's Mt. Gox, once the world's leading bitcoin exchange, was ordered to the U.S. to answer questions related to its U.S. bankruptcy case, filed after the company lost $400 million of customers' digital currency, Reuters reported yesterday. Bankruptcy Judge Stacey Jernigan yesterday ordered Mt. Gox CEO and majority owner Mark Karpeles to appear on April 17 in Dallas at the offices of Baker & McKenzie, the law firm that represents Mt. Gox. Mt. Gox customers want Karpeles to explain why the exchange shut down in February and what happened to their 750,000 bitcoins, which the company said were stolen in a computer hacking attack.

Momentive Performance Materials Inc. said yesterday that it may file for chapter 11 protection and is in talks with stakeholders to restructure the debt of the silicone and quartz producer, Reuters reported yesterday. As of Sept. 30, the company had total liabilities of $4.14 billion, it said in a filing with the U.S. Securities and Exchanges Commission on Tuesday. The unit of Apollo Global Management LLC said that it was unable to file its annual report for the period ended Dec. 31, on March 31.

The partnership behind the failed Foxwoods Casino project in South Philadelphia filed Monday for bankruptcy court protection, citing claims of $23.6 million from 14 creditors, Philly.com reported today. In addition, Citizens Bank, the largest creditor, is owed an unspecified amount, according to the court petition. The partnership last week sold its largest asset, a vacant 16.5-acre lot on South Columbus Boulevard between Tasker and Reed Streets. The property was transferred to developer Bart Blatstein for $13 million. Of the proceeds, $8 million went to the City of Philadelphia to settle a tax bill.

KKR & Co., TPG Capital and Goldman Sachs Capital Partners, the firms that acquired Energy Future Holdings Corp. in the biggest-ever leveraged buyout, would be all but wiped out in a reorganization plan being discussed, Bloomberg News reported yesterday. The firms may accept as little as 1 percent of the equity in the company after it completes a chapter 11 restructuring. The pre-bankruptcy plan is being negotiated by the private-equity owners, the company’s management and holders of the power producer’s $45.6 billion of debt. Energy Future is hashing out a proposal that would reduce the amount of time it takes to restructure in chapter 11 and limit the chaos of a free-for-all filing. Fidelity Investments, which is a key debtholder throughout the Dallas-based company’s capital structure and had been a holdout on the bankruptcy road map, moved closer last week to an accord.

Women’s retailer Coldwater Creek Inc. is preparing to file for bankruptcy protection within about a week as it contends with a high debt load, declining sales and broader industry struggles, the Wall Street Journal reported today. Coldwater Creek, known for its catalogs selling a variety of women’s clothes and accessories as well as mall-based retail stores, has struggled for months. Attempts to avoid a bankruptcy filing by refinancing debt or selling itself to a private-equity buyer were ultimately unsuccessful. The company’s post-bankruptcy strategy isn’t clear. Coldwater Creek carries about $353 million in total debt, which includes about $180 million in current liabilities, according to its most recent earnings filing.

Energy Future Holdings said yesterday that it has extended a deadline to file its annual report, giving the company more time to negotiate with creditors as it seeks an agreement to reduce its crushing debt, Reuters reported yesterday. The former TXU Corp was expected to report yesterday that its auditor had determined it could not survive as a going concern, a finding that would have triggered a default on its loans and a likely bankruptcy filing. The company said that it has extended that deadline, but did not say for how long. It added that it will miss an interest payment due today, but has a grace period in which to make the payments before a default.