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In a rash of filings Thursday made before a late-afternoon deadline, several parties connected to Dewey & LeBoeuf came out either for or against a proposed settlement plan that would collect $71 million from ex-Dewey partners in exchange for a release from Dewey-related liability, American Law Daily reported today. Those opposed to the plan include an ad hoc committee of retired partners from Dewey predecessor firm LeBoeuf, Lamb, Greene & MacRae and an official committee of retirees created by the U.S. Trustee's office as part of the chapter 11 proceedings. Both groups have previously expressed concerns about the fairness of the proposed settlement and have asked Bankruptcy Judge Martin Glenn to appoint a neutral third party to oversee the case so that all parties are treated equitably. The oppositions came the same day that the unsecured creditors' committee, as well as informal groups of former Dewey partners, pledged their support for the settlement.

CME Group customers and members who were clients of MF Global are getting another chance to file claims against property of the bankrupt brokerage that was held by the exchange operator, Reuters reported yesterday. CME, the largest U.S. exchange operator, said in a notice distributed on its Chicago trading floor yesterday that it decided to reopen the claims process "to ensure that all members have an opportunity to file any claims that they may have." MF Global collapsed last fall and customer accounts were frozen after former Chief Executive Jon Corzine's $6.3 billion bet on European sovereign debt worried investors, counterparties and credit rating agencies. CME, which was MF Global's first-line regulator, previously had a Jan. 31 deadline for claims related to MF Global. The brokerage was one of CME's largest customers.

Investment funds that were early backers of Solyndra LLC stand to reap up to $341 million in tax breaks from its bankruptcy, according to court documents filed yesterday, Reuters reported. The U.S. government, which lent Solyndra $528 million and may never recover the money, had demanded that the company reveal the value of future tax breaks available to Madrone Partners and Argonaut Ventures. The two funds plan to bring Solyndra's holding company out of bankruptcy and the potential tax breaks appear to be the main asset, according to court documents. The court documents also said that the tax breaks could ultimately be worth very little and the company's bankruptcy plan still has to be voted on by creditors and approved by a judge.

Morris Brown College officials have filed for chapter 11 bankruptcy in a final effort to prevent the 131-year-old school from being foreclosed on and sold at auction, the Atlanta Journal-Constitution reported yesterday. Morris Brown, which is more than $30 million in debt, was facing foreclosure next month after investors called $13 million worth of bonds tied to the college. The bonds were issued by the Fulton County Development Authority in 1996. As security for the bonds, Morris Brown pledged several pieces of property, including the school's administration building. An auction of assets had been scheduled for Sept. 4.

Former partners from defunct law firm Dewey & LeBoeuf LLP have agreed to give back at least $50 million in past earnings in exchange for immunity from lawsuits relating to the New York firm's demise, the Wall Street Journal reported today. If approved, the deal would mark an unusually early resolution of such "clawback" claims, which typically take years to resolve following a law firm's failure. The firm sought chapter 11 protection on May 28 following a difficult six months of partner exits amid disagreements over compensation and the firm's inability to extend credit agreements with lenders.

Solyndra LLC, the bankrupt solar-panel maker that received a $535 million U.S. Energy Department loan guarantee, reached a $3.5 million settlement with former workers who claimed they received inadequate layoff notices, Bloomberg News reported yesterday. The settlement will resolve allegations that the company failed to give employees 60 days' notice under the Worker Adjustment and Retraining Notification Act when it fired most of its 1,100 workforce on Aug. 31, just before seeking bankruptcy court protection last year. Solyndra will set up a $3.5 million fund to be distributed to the workers two weeks after the settlement is effective, according to court papers. The settlement was jointly proposed by Solyndra and the ex-employees.

A new bankruptcy study by two university professors found that incentive bonus plans for managers of bankrupt companies "significantly improve" outcomes for creditors, the Wall Street Journal's Bankruptcy Beat Blog reported on Friday. "Firms that adopt these plans—especially the incentive plans—are more likely to emerge, have shorter duration in restructuring and are less likely to violate the absolute priority rule under bankruptcy law," said Wei Wang, an assistant professor of business at Queen’s University. The study titled "Provision of Management Incentives in Bankrupt Firms" looked at 417 large public companies that filed for chapter 11 between 1996 and 2007. Of those, about 39 percent offered retention and incentive plans to key employees and the researchers looked at what effect, if any, those plans had on the outcomes of the bankruptcy cases. Wang, who co-authored the study with Vidhan K. Goyal, a finance professor at the Hong Kong University of Science and Technology, also said that the research does not support the common view among many bankruptcy observers that bonus plans enrich managers at the expense of creditors. On the contrary, creditor control—for example, when a hedge fund or lender is directing the bankruptcy case—increases the likelihood that bankrupt firms offer retention and incentive bonuses to managers, he said. Wang added that while it is true that retention plans did not have any impact on chapter 11 cases, companies that adopted incentive bonuses spent less time in bankruptcy and were in better shape when they emerged. To read the study, please click here: https://www.documentcloud.org/documents/408293-kerpaugust8.html

MF Global Inc. customers who had money trapped when the U.S. broker collapsed are rushing to sell their claims at higher prices after a prediction they could recover 100 percent of what was lost, Bloomberg News reported yesterday. Louis Freeh, the trustee for the brokerage's parent, MF Global Holdings Ltd., said yesterday at a U.S. Senate Agriculture Committee hearing that customers may eventually recoup all of their money. His testimony was at odds with that of a trustee for the brokerage, James Giddens, who predicted customers will eventually get a recovery of about 90 percent. Those who buy customer claims said that prices and volumes are increasing today as a result.

A bankruptcy trustee sifting through the remains of MF Global Holdings Ltd. expressed confidence that the failed securities firm's U.S. customers will get all their money back, the Wall Street Journal reported today. In written testimony submitted to the Senate Agriculture Committee for a hearing today, trustee Louis J. Freeh said that farmers, ranchers, traders and other investors still owed an estimated $1.6 billion "eventually will be made whole." After MF Global collapsed in October under the weight of a customer panic caused by the New York company's giant bets on European debt, investigators worried they might never recover the missing customer money. The shortfall occurred when MF Global dipped into customer accounts as it scrambled to stay alive. Prosecutors and regulators are trying to determine who is responsible for withdrawing money from the customer accounts, which under U.S. rules should have been kept separate from MF Global's own money. Freeh, former director of the Federal Bureau of Investigation, has been working to recover as much money as possible for creditors of the defunct company, while trustee James Giddens is trying to recoup funds for its U.S. brokerage firm's customers.

For further details on the hearing, including the witness list and prepared testimony, please click here:
http://www.ag.senate.gov/hearings/examining-the-futures-markets-respond…

Unsecured creditors are protesting the sale process lined up by SP Newsprint Holdings LLC, saying their "greatest fear"---that the company is focused solely on benefiting its lenders---has come true, Dow Jones DBR Small Cap reported today. SP Newsprint wants to place its assets on the auction block with a $145 million deal from a group of top-ranking lenders kicking off the bidding, a sale process it said has to move swiftly because the company is running out of money.