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Montreal, Maine & Atlantic Railway Ltd.'s bankruptcy trustee is suing the owner of the crude oil its train was carrying when it derailed last summer, saying that the company's alleged negligence contributed to the accident that killed 47 people and partially destroyed a small Quebec town, the Wall Street Journal reported on Saturday. Chapter 11 trustee Robert J. Keach on Thursday filed a lawsuit in bankruptcy court against World Fuel Services Corp. of Miami and several other companies, accusing them of falsely identifying the crude oil as a low danger when in fact it was highly volatile and dangerous. Keach said that World Fuel also knew — or should have known — that the type of tank cars carrying the oil were prone to rupture upon derailment, making the cars "unsafe and unsuitable" for the transport of the crude oil. Had MM&A known of the true dangers of the crude oil, Keach said, the railway would have taken such safety measures as not leaving the train unattended and parking it on a blocked side track. Instead, he said MM&A parked the train on a main track with a slight descending grade, from which the unattended train began its ill-fated descent into the Quebec town of Lac-Mégantic early on July 6.

LightSquared Inc. and its various creditors are in talks to devise a consensual plan to restructure the wireless company's assets and end its bankruptcy, Reuters reported on Friday. LightSquared, owned by Phil Falcone's Harbinger Capital Partners, is trying to bridge disagreements among proponents of three separate reorganization proposals currently on the table, according to Paul Basta, a lawyer for a special committee overseeing the company's restructuring. The talks so far do not include representatives for Dish Network Corp Chairman Charles Ergen, whose debt holdings make him LightSquared's largest single creditor. LightSquared has accused Ergen of surreptitiously buying the debt to effect a takeover of LightSquared by Dish, a key competitor. A trial on that dispute remains ongoing.

China’s one-time solar-power giant Suntech Power Holdings Co. plans to file for bankruptcy protection in U.S. court as its leaders negotiate with the holders of more than $500 million in U.S. convertible bonds, the Wall Street Journal reported on Saturday. Suntech Power Holdings, which was once the world’s largest solar panel maker, defaulted on its U.S. debt in March, and financial professionals in the Cayman Islands — where the holding company is incorporated — have been trying to negotiate a repayment plan with bondholders. Suntech plans to file for chapter 15 protection. If recognized by a U.S. judge, the solar panel maker will receive the benefits of U.S. bankruptcy law, including the so-called automatic stay that halts lawsuits and prevents creditors from seizing assets. The filing is expected by Feb. 21.

Advantage Rent a Car is asking a bankruptcy judge to let it borrow another $20 million from Canadian private-equity firm Catalyst Capital Group Inc., which has already pumped $46 million into the car-rental chain, the Wall Street Journal reported today. If Bankruptcy Judge Edward Ellington of the U.S. Bankruptcy Court in Jackson, Miss., grants the request at a Feb. 12 hearing, it will allow Advantage to take on more debt to continue its operations. Advantage said in court documents filed on Wednesday that it will exhaust its current borrowing limit by Feb. 15.

U.S. Trustee William Harrington is protesting a potential $2.7 million bonus for Personal Communications Devices LLC Chief Executive George Appling, arguing that lawyers haven't proven that he worked hard enough to earn that bonus before the mobile phone distributor was sold in bankruptcy last fall, Dow Jones Daily Bankruptcy Review reported today. Harrington said in court papers that the proposed bonus for Appling, who remained CEO after the sale, wasn't designed to encourage him to work harder during the company's search for buyers who could purchase the company out of bankruptcy.

The relatives of those killed in last summer’s train derailment in Quebec are turning to former U.S. Senator George Mitchell to make sure they get paid in the railway company’s bankruptcy, the Wall Street Journal reported today. Attorneys representing holders of wrongful death claims against Montreal, Maine & Atlantic Railway Ltd. in connection with last July’s derailment in Lac-Mégantic filed a creditor-payment plan yesterday on the railway’s behalf in bankruptcy court. Court papers show Sen. Mitchell, a Democrat who represented Maine in the U.S. Senate from 1980 to 1995, would administer the plan and lead the effort to wrap up MM&A’s chapter 11 bankruptcy following the railway’s $15.85 million sale to a unit of Fortress Investment Group LLC.

Chemical maker W.R. Grace & Co received approval to line up about $1.55 billion in bankruptcy exit financing, Reuters reported yesterday. Grace will use the money to pay all outstanding claims, including $1.1 billion to its lenders, removing the last obstacle to its emergence out of bankruptcy protection. The remaining amount will go towards funding trusts that will be created to pay asbestos-related injury claims, an earlier court filing showed. The company is likely to emerge from bankruptcy on Jan. 31.

Two families that own major Hispanic-oriented grocery store chains throughout the Southwest got approval from a federal judge Tuesday to purchase the struggling Pro's Ranch Market chain's 11 stores out of bankruptcy, Dow Jones Daily Bankruptcy Review reported today. After reviewing the purchase offer at a court hearing, Bankruptcy Judge Sarah Sharer Curley said that she would approve it, according to Pro's Ranch Market attorney Frederick Petersen. The buyers' offer is worth about $53.6 million, according to court documents.

Bankruptcy Judge James Peck approved Lehman Brothers Holdings Inc.'s settlement with Fannie Mae over $18.9 billion in mortgage claims, one last major decision as Lehman's bankruptcy judge before his retirement at the end of the week, the Wall Street Journal reported today. His last major approval, over mortgage loans and mortgage-backed securities Lehman sold Fannie in the years before the financial crisis, was apropos considering the housing industry's contribution to Lehman's demise. No one objected to the settlement. Fannie Mae, which originally said that it was owed $18.9 billion, will receive a general unsecured claim of $2.15 billion against Lehman. Bankruptcy Judge Shelley C. Chapman will be taking over the Lehman case following the retirement of Judge Peck.

Philip Falcone’s LightSquared Inc., seeking to reorganize in bankruptcy, received loan offers from a fund owned by Fortress Investment Group LLC and an entity linked to the wireless-network company’s one-time suitor, Dish Network Corp. Chairman Charlie Ergen, Bloomberg News reported yesterday. The loan proposals are superior to one from a group of LightSquared’s lenders, Fortress Credit Investments and Ergen’s SP Special Opportunities LLC said in papers filed on Jan. 24. Their arguments are to be considered at a Jan. 31 hearing.