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The fight over defunct Nortel Networks' $7.5 billion in cash will be decided in joint U.S.-Canadian court hearings and not in arbitration, a U.S. appeals court ruled on Friday, Reuters reported on Saturday. The U.S. Court of Appeals for the Third Circuit upheld a bankruptcy court ruling in March that there was never an agreement to use arbitration to divide the pile of cash among various Nortel estates around the world. Nortel sought protection from creditors in courts around the world in 2009 and its businesses were quickly sold, reducing a once-global corporate giant to little more than a pile of cash. But it was never decided how to allocate the money raised between different insolvency and bankruptcy proceedings in different countries. An agreement governing the money refers to undefined "dispute resolvers" that Nortel's European estates argued was arbitration. The U.S. Bankruptcy Court in Wilmington, Del. disagreed, and the Court of Appeals affirmed that ruling.

Northern Beef Packers LP is set to sell its assets to White Oak Global Advisors for $44.3 million, after that sale received the bankruptcy court's blessing on Thursday, the Wall Street Journal reported on Saturday. Bankruptcy Judge Charles Nail Jr. of the U.S. Bankruptcy Court in Aberdeen, S.D., approved the San Francisco-based firm's offer of $4.8 million in cash and $39.5 million in debt forgiveness, according to court documents. American Foods Group LLC also submitted a qualified offer of $12.7 million in cash, but White Oak was deemed the successful bidder. Northern Beef Packers filed for chapter 11 protection in July with a plan to sell its assets, after suspending operations at its South Dakota meat packing plant.

A U.S. Supreme Court justice on Saturday night denied a last-ditch effort by a group of consumers and travel agents to stop the merger of American Airlines and US Airways, Reuters reported yesterday. The application was denied by Justice Ruth Bader Ginsburg, the court's public information office said. The combination of American's parent, AMR Corp, and US Airways Group would create the world's largest carrier and follow last month's resolution of antitrust objections by the U.S. Department of Justice. In their appeal to the Supreme Court, plaintiffs led by California resident Carolyn Fjord warned that "irreparable injury" could be caused to the domestic airline industry if the deal goes ahead as planned. They fear the merger will drive air travel prices up and service down and make planes more crowded. The merger is expected to be consummated before the opening of U.S. securities markets today. A federal judge on Friday rejected the previous attempt by the group to stop the merger.

Edison Mission Energy 's bondholders are hiring a team led by TXU Corp.'s former chief executive to help them navigate a coming legal battle in Edison Mission's bankruptcy, Dow Jones Daily Bankruptcy Review reported today. Bankruptcy Judge Jacqueline Cox on Thursday authorized Edison Mission to pay the bills of Bluescape Advisors LLC as Bluescape advises the bondholder group in connection with possible litigation against Edison Mission's parent, Edison International.

Cerberus Capital Management is poised to take charter airline operator Global Aviation Holdings Inc. out of its second chapter 11 case in as many years, subject to higher bids at auction, Dow Jones Daily Bankruptcy Review reported today. A Cerberus affiliate is offering to sponsor Global Aviation's plan to pay its creditors and exit bankruptcy proceedings in exchange for which the buyout firm would own the restructured company, according to court papers filed on Tuesday.

Atari Inc., the company that helped give birth to the modern-day videogame industry with the introduction of now-classic games such as Asteroids and Pong, received court approval of its plan to exit bankruptcy under the control of its French parent Atari S.A., the Wall Street Journal reported today. Bankruptcy Judge James Peck confirmed the bankruptcy-exit strategy proposed by Atari that is based on a $3.4 million cash contribution plus an additional $1.75 million when Atari exits bankruptcy from parent company Atari S.A. Bankruptcy lender Alden Global Capital will be paid in full the $3.8 million it is owed. Atari will use its remaining cash to pay up to $560,000 to unsecured creditors when it leaves bankruptcy, another $560,000 a year after that and $630,000 the following year.

Why the bankruptcy court in Delaware garnered almost five times more significant Chapter 11 reorganizations this year than New York is the first topic of discussion on the new video with Bloomberg Law's Lee Pacchia and Bloomberg News bankruptcy columnist Bill Rochelle. Click here to watch.

Southwest Airlines Co. and Virgin America Inc. are poised to add flights at New York’s LaGuardia Airport as American Airlines and US Airways Group Inc. pull back there to settle the U.S. antitrust lawsuit against their merger, Bloomberg News reported yesterday. Southwest, the biggest discount carrier, will buy 12 new flight slots, enough for six daily round trips, along with 10 slots now leased from American, the Federal Aviation Administration said in a regulatory filing. Virgin America will get 12 flight slots. The FAA said that it approved the transactions after the U.S. Justice Department required that American and US Airways divest flight rights as a condition of their merger, which is set to close on Dec. 9. Talks are under way on how American and US Airways will divest slots for 104 daily flights at Washington, D.C.’s Reagan Airport.

Doug Parker, poised to lead the new American Airlines Group Inc., wants to beat a $1 billion goal for added revenue and savings in the AMR Corp.-US Airways Group Inc. (LCC) merger and is about to start meshing frequent-flier plans, Bloomberg News reported today. Parker will take the helm of a carrier that will sit atop the global industry by traffic after the $17.8 billion all-stock deal. He will have to knit together two networks to challenge United Continental Holdings Inc. and Delta Air Lines Inc., which now rank first and second in the world. The merger is set to close Dec. 9.

Advantage Rent a Car, which is going on the auction block next week, on Tuesday received the bankruptcy court's final blessing for a $36 million bankruptcy loan from its would-be buyer, Catalyst Capital Group Inc., the Wall Street Journal reported today. Court papers show that Bankruptcy Judge Edward Ellington on Tuesday granted final approval to a loan that is meant to see the car-rental company through its chapter 11 case and sale. While the official loan amount is $36 million, it can be increased to $46 million if Advantage and Catalyst so choose. The loan puts Catalyst, a Canadian private-equity firm, in a prime position to acquire Advantage Rent a Car through a process overseen by the bankruptcy court. Catalyst will lead off the bidding at Monday's auction with its offer to forgive the full amount of the loan in exchange for the assets instead of paying cash.