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Eastman Kodak won bankruptcy court approval yesterday to stop providing health and welfare benefits to 56,000 U.S. retirees and dependents, the Rochester (N.Y.) Democrat and Chronicle reported today. Kodak had been seeking court approval to stop offering such benefits by the end of the year as the company said that it spends nearly $10 million a month on such benefits. The two largest wedges of the retiree-related debt are health coverage for 32,000 Medicare-eligible retirees, representing a $440 million liability on its balance sheet, and the Survivor Income Benefit for 7,500 people representing a $510 million liability.

The U.S. Bankruptcy Court building in Lower Manhattan remains paralyzed in the aftermath of Hurricane Sandy, forcing a scramble by judges and lawyers to hold key hearings wherever they can find a courtroom, Dow Jones Newswires reported yesterday. The court, one of the country's bankruptcy epicenters, took the rare step yesterday of issuing an order allowing judges to go outside the Southern District of New York to hold hearings. The order cites "extraordinary damage and disruption," "widespread power and utility outages," and "extensive transportation problems" in the New York area. "It is currently unclear when the United States Bankruptcy Court in Manhattan will again be accessible," said the order, signed by Chief Judge Cecelia G. Morris. Judges are turning to open courthouses in places like Brooklyn and White Plains, N.Y., where the buildings fared better than the one downtown, to ensure that bankruptcy proceedings can go on.

Two Republican senators asked U.S. Treasury Secretary Timothy Geithner yesterday for a thorough review of a Chinese company's plan to acquire bankrupt battery maker A123, saying that military and taxpayer-funded technology must be protected, Reuters reported yesterday. China's Wanxiang Group Corp is currently locked in a battle with U.S.-based Johnson Controls Inc to buy A123, which makes lithium ion batteries for electric cars. A123 also had two contracts worth a total of more than $4 million to develop batteries for the Air Force, one of which is still ongoing, an Air Force official said. Senators John Thune (R-S.D.) and Chuck Grassley (R-Iowa) said the powerful Committee on Foreign Investment in the U.S. (CFIUS), led by Geithner, should review the transaction to make sure U.S. military and taxpayer interests in A123 are protected. To acquire A123, Wanxiang needs approval from the Chinese government and from CFIUS, a U.S. inter-agency panel that vets foreign deals for security concerns.

Following two public comment periods and a public meeting, the United States Trustee Program (USTP) has updated its proposed guidelines for attorney compensation in larger chapter 11 cases, the USTP announced today. For purposes of these guidelines, a larger chapter 11 case is defined as a chapter 11 case with $50 million or more in assets and $50 million or more in liabilities, aggregated for jointly administered cases and excluding single asset real estate cases as defined in 11 U.S.C. § 101(51B). The USTP is accepting public comments on the updated proposed guidelines through Nov. 23, 2012. A document containing the updated proposed guidelines, a summary of the significant revisions to the initial version of the proposed guidelines posted on November 4, 2011, and the USTP’s analysis of comments received is available at http://www.justice.gov/ust/eo/rules_regulations/guidelines/proposed.htm. Comments on the updated proposed guidelines should be submitted by email to USTP.Fee.Guidelines@usdoj.gov. Alternatively, comments may be submitted by telefax to (202) 307-2397 or by mail to EOUST, 20 Massachusetts Ave., N.W., 8th Floor, Washington, D.C. 20530. To ensure proper handling of comments, please reference “Fee Guidelines” on all correspondence.

The Dewey & LeBoeuf estate has begun to try to whittle away some of the thousands of claims asserted by aggrieved creditors hoping to recover at least a portion of what they say Dewey owes them, the American Law Daily reported today. To date, more than 2,100 proofs of claim have been filed against Dewey, which became the largest law firm in U.S. history to fail when it filed for chapter 11 protection on May 28. Those submitting the claims—which range from a low of $10 up to several million dollars—include vendors, former firm staffers, and landlords. Dewey’s advisers have said they believe that all told, the estate owes creditors $260 million in secured debt and $300 million $500 million more in unsecured claims. In a pair of filings made on October 26, the Dewey estate seeks to invalidate several dozen claims that they say are duplicative or were submitted after the September 7 deadline.

Nova Financial Holdings Inc. filed for bankruptcy after its banking unit was closed by regulators, making it the 47th bank to fail in the U.S. this year, Bloomberg news reported today. The chapter 7 petition for the bank holding company listed assets of as much as $100,000 and debt of as much as $50 million. Nova Bank had about $483 million in assets and $432 million in deposits as of June 30, according to a Federal Deposit Insurance Corp. statement. The Pennsylvania Department of Banking closed Nova Bank on Oct. 26, according to the FDIC, which became the receiver. The FDIC was unable to find another financial institution to take over the banking operations. Nova Bank’s failure will cost the Deposit Insurance Fund about $91.2 million, the FDIC estimated.

A123 Systems Inc., the electric-car battery maker that recently filed for bankruptcy, is seeking emergency approval to tap a $50 million loan provided by a Chinese auto parts maker to fund its chapter 11 case pending an auction of the clean energy firm, the Wall Street Journal reported yesterday. Lawyers for A123 Systems said on Sunday in a bankruptcy court filing that Chinese auto parts maker Wanxiang Group Corp. will provide the debtor-in-possession financing, replacing initial lender Johnson Controls Inc. Wanxiang's bankruptcy loan, which cuts the interest rate to 12 percent from 15 percent from Johnson Controls' initial offer, comes as a bidding war heats up between the two companies vying for the Massachusetts-based battery maker's assets.

Employees at MF Global could not keep track of exactly how much money it had at any given moment, even before the company began to wobble, according to internal company emails reviewed by the Wall Street Journal. As regulators and lawmakers plow ahead with investigations that began when MF Global tumbled into bankruptcy a year ago this week, gaps in the New York company's procedures for moving and keeping track of money are getting new attention. A private lawsuit expected to be updated early next month is expected to highlight such issues and how they are tied to the more than $1 billion that went missing from customer accounts as MF Global failed last October. A House Financial Services Committee report, which will be released in the next few weeks, is expected to scrutinize how regulators handled MF Global. It is unclear how much focus will be given to the deficiencies in internal computer systems and procedures at the firm.

Fisker Automotive Inc., a closely held startup carmaker led by auto designer Henrik Fisker, asked a bankruptcy judge to delay the auction of U.S. electric-car battery maker A123 Systems Inc., Bloomberg News reported on Friday. Fisker, based in Anaheim, Calif., also said on Friday that it would file an “emergency motion” challenging a debtor-in-possession loan, but did not provide details regarding the court motion. A123, the recipient of a $249 million federal grant, said it would sell its automotive-business assets to Milwaukee-based Johnson Controls Inc. in a deal valued at $125 million. The deal is subject to other potential offers in a bankruptcy auction. A123, based in Waltham, Mass., listed assets of $459.8 million and debt of $376 million as of Aug. 31 in chapter 11 documents.

Ocwen Financial Corp. and Walter Investment Management Corp. have teamed up to top Nationstar Mortgage Holdings Inc's starting bid for Residential Capital LLC's mortgage business, ensuring a bankruptcy auction goes ahead next week, Reuters reported on Friday. The consortium offered to buy the mortgage business for $40 million more than Nationstar's $2.45 billion opening bid, though Nationstar was expected to make an updated bid. Several other potential buyers that had shown interest in the business, including private equity firm Blackstone Group and technology company IBM Corp, were not expected to submit offers, potentially leaving Nationstar and the Ocwen-Walter group as the main contenders.