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A federal appeals court ruled that two former investors with Bernard Madoff cannot pursue claims against the estate of a Florida businessman who was one of the convicted swindler's biggest clients, Reuters reported yesterday. The decision by a three-judge panel of the U.S. Court of Appeals for the Second Circuit is a victory for Irving Picard, the trustee liquidating Madoff's firm, in a battle over his authority to reach settlements on behalf of victims of Madoff's Ponzi scheme. Picard reached a $7.2 billion settlement with the estate of Jeffry Picower in 2010, the largest such settlement on behalf of victims of Madoff's Ponzi scheme. The trustee has said that Picower, who drowned in 2009, knew or should have known that Madoff was operating a fraud. About $5 billion was to go to the estate of Bernard L. Madoff Investment Securities LLC and $2.2 billion was to be forfeited to the U.S. government. Picower's widow at the time said she "absolutely confident" her husband was not complicit.

Attorneys working to settle litigation over a deadly fungal meningitis outbreak say they hope to finalize a tentative $100 million-plus deal and present it for court approval in the next two months, the Wall Street Journal reported on Friday. The New England pharmacy, which faces litigation related to the outbreak, last month tentatively agreed to create a fund to pay more than $100 million victims and their families. According to the Centers for Disease Control and Prevention, 64 people have died and about 700 others have fallen ill as a result of the outbreak. “It’s the trustee’s goal to file a motion with the bankruptcy court to have those settlements approved in the next 30 days or so,” said Michael Gottfried, who is representing the pharmacy’s bankruptcy trustee, Paul Moore. “A hearing might be scheduled on that 30 days or so after he files the motion.” The pharmacy, New England Compounding Pharmacy Inc., filed for chapter 11 protection in December 2012 after the CDC identified it as the origin of the tainted steroid injections that caused the outbreak.

Several health care companies are interested in buying Poughkeepsie, N.Y.-based Saint Francis Hospital, which recently filed for chapter 11 bankruptcy protection, Dow Jones Daily Bankruptcy Review reported today. ArchCare, a nonprofit health care organization affiliated with the Archdiocese of New York, and Westchester County Health Care Corp. both sent letters to a bankruptcy court indicating they will submit bids in an effort to purchase the hospital. The 333-bed facility is looking for bidders who can top the more-than $24 million offered by stalking-horse bidder Health Quest Systems Inc., which has promised to keep the 2,000-worker hospital open. An auction has been scheduled for Feb. 13, with a sale hearing to follow on Feb. 18.

Dish Network Corp. Chairman Charles Ergen is set to defend his purchase of $1 billion in debt in bankrupt wireless provider LightSquared Inc. against claims by Philip Falcone that the investment was improper, Bloomberg News reported today. Falcone, whose Harbinger Capital Partners LLC controls LightSquared, has accused Ergen of surreptitiously buying the debt to hijack LightSquared’s reorganization and get control of the company’s airwaves. Ergen, who is scheduled to testify today before Bankruptcy Judge Shelley Chapman, has defended the debt purchases as a smart investment and said that he made no “false representations” in pursuing it. Falcone is seeking to disallow the $1 billion claim. He has proposed that he hold onto the Reston, Va.-based LightSquared, into which he has already sunk $3 billion. He may to testify later in the trial.

Bankruptcy Judge Kevin Gross rejected a planned sale of Fisker Automotive to Hong Kong businessman Richard Li in favor of competitive bidding, opening the way for China's largest auto parts company to bid for the maker of the Karma plug-in hybrid sports car, Reuters reported on Friday. Judge Gross said on Friday that competitive bidding between a company affiliated with Li and a unit of auto parts maker Wanxiang Group of China was the best way forward. He scheduled a hearing for 2 p.m. today to decide how to proceed with an auction.

Dish Network Corp.’s motion to drop its $2.2 billion offer for airwaves owned by LightSquared Inc. became the focus of a trial over how Dish Chairman Charles Ergen bought debt in Philip Falcone’s bankrupt wireless broadband company, Bloomberg News reported yesterday. Dish sent a termination letter just before a trial began yesterday bankruptcy court, where the satellite-television company and Ergen are accused of improperly acquiring the LightSquared debt. Lawyers for LightSquared told Bankruptcy Judge Shelley Chapman that Dish’s latest move may be a gambit to drive down the price of the assets. The lawyers said Ergen began stockpiling the debt in 2011, the year before LightSquared’s bankruptcy, and spent $800 million of his personal wealth, including money in his daughter’s trust fund.

A former private wealth adviser for a unit of Lehman Brothers Holdings Inc can keep a lucrative signing bonus he received from the firm three years before it collapsed, a securities arbitration panel has ruled, Reuters reported yesterday. Lehman lost its bid to recoup $1.8 million from William Gourd, who joined the firm in early 2005, according to a ruling this week by a Financial Industry Regulatory Authority arbitration panel. Lehman Brothers Holdings Inc. has been pursuing roughly 50 of its former licensed securities professionals to return portions of the bonuses they received when hired.

Banks are lined up to provide up to $1.55 billion worth of loans to W.R. Grace & Co. when the specialty chemical company ends a dozen-year stay in bankruptcy at the end of this month, Dow Jones Newswires reported yesterday. The financing, which carries some $21.25 million worth of fees, is being coordinated globally by affiliates of Goldman Sachs Group Inc. and Deutsche Bank AG. It involves affiliates or units of Bank of America Corp., Citigroup Inc., HSBC Holdings PLC, Commerzbank AG, KeyBanc Capital Markets Inc., PNC Financial Services Group Inc. and Sumitomo Mitsui Banking Corp. At a Jan. 29 bankruptcy court hearing, Grace will seek court authority to enter into the loan commitments along with other final touches on a chapter 11 restructuring that will remove from the Maryland company the threat of billions of dollars worth of liabilities for injuries linked to asbestos, a toxic material used decades ago. Bankruptcy exit financing is "likely to include" a $700 million senior secured term loan, a $200 million euro equivalent senior secured term loan, a $250 million senior secured delayed draw term loan, a senior secured revolving loan of up to $250 million and a multicurrency senior secured revolving loan of up to $150 million, according to papers filed on Tuesday.

A bankruptcy judge yesterday approved a settlement that allows Peregrine Financial Group to avoid dueling legal claims over its collapse and ensures that any litigation proceeds wind up in the hands of the brokerage's customers and creditors, Dow Jones Daily Bankruptcy Review reported today. Bankruptcy Judge Carol A. Doyle signed off on the deal struck last month between the official overseeing Peregrine's liquidation, trustee Ira Bodenstein, and Peregrine's customers. Under the settlement, Bodenstein will stand down in a battle over litigation and will allow Peregrine's customers and creditors to take the lead in pursuing any legal claims Peregrine may have against Peregrine's former president, Russell Wasendorf Jr., related to his father's "misappropriation of customer funds" from Peregrine.

A federal bankruptcy judge granted the Rockets permission yesterday to continue negotiating on behalf of Comcast SportsNet Houston and set Feb. 4 to hear arguments on the Houston Astros’ motion to dismiss an involuntary chapter 11 bankruptcy petition filed against the network last September, the Houston Chronicle reported yesterday. Bankruptcy Judge Marvin Isgur also provided a clearly worded signal indicating that if the Astros-Rockets-Comcast partnership enters bankruptcy, he favors eliminating a controversial clause that requires all three partners to agree on significant decisions. Judge Isgur agreed to extend until next month the Rockets’ power to seek new business for CSNH but also lifted a stay on two undecided motions in the case, the more significant of which is the Astros’ motion to dismiss the involuntary bankruptcy proceeding.