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JPMorgan Chase & Co. yesterday sought to limit the power the bankruptcy trustee for Peregrine Financial Group has to subpoena information from financial institutions that did business with the failed brokerage, Reuters reported yesterday. JPMorgan said in a court filing that Trustee Ira Bodenstein's request for authorization from a bankruptcy court to serve subpoenas on financial information may be overly burdensome by encompassing Peregrine's affiliates and wholly owned subsidiaries, in addition to the brokerage itself. Bodenstein last week asked the court for the authority to require 10 financial institutions, including JPMorgan, to produce information about open and closed accounts maintained by Peregrine, its affiliates and subsidiaries.

The trustee overseeing Peregrine Financial Group Inc. wants to subpoena financial records from 10 banks involved with the collapsed U.S. brokerage, the Wall Street Journal reported today. A federal judge is being asked to allow court-appointed trustee Ira Bodenstein to issue subpoenas to JPMorgan Chase & Co., US Bank, Citigroup Inc., Morgan Stanley and Goldman Sachs Group Inc. and five other institutions, according to a court filing late yesterday. Bodenstein said in the filing that he was seeking information related to open and closed Peregrine accounts at the institutions. The trustee also wants information from Bank of New York Mellon Corp., First Premier, Jefferies Bache, Royal Bank of Scotland Group PLC and Commerzbank AG. The request is due to be heard by the judge at a hearing on Aug. 7.

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…

Dewey & LeBoeuf largely won court approval yesterday of a plan to pay up to $700,000 in retention and incentive bonuses in an effort to encourage a dwindling number of employees to stay at the defunct law firm, Reuters reported yesterday. U.S. Trustee Tracy Hope Davis had objected to the plan, saying that the firm had not shown the plan was "economically feasible" or justified. But Bankruptcy Judge Martin Glenn said yesterday that the costs were reasonable given what would happen if its remaining employees, who number fewer than 50, left. Dewey has been winding down since filing for chapter 11 in May. Once a firm of 1,400 lawyers globally, today it has just a handful of employees left, who are helping Dewey collect bills and dispose of hundreds of thousands of client files.

Another potential bidder is balking at proposed deal sweeteners for LSP Energy's proposed stalking-horse bidder, which could get a payment of $7.5 million if it is beat out at auction, Dow Jones DBR Small Cap reported today. In court papers filed on Tuesday, Quantum Utility Generation LLC said that the proposed breakup fee increases the cost of participating in the auction for rival bidders by $9.5 million over previously approved auction rules that didn't require the payment of a breakup fee or an initial $2 million overbid.

Former Kodak employees who fear for their pensions and other benefits are urging a bankruptcy judge to think of them and not rubber-stamp $8.8 million in executive bonuses, the Wall Street Journal reported today. In letters filed to Kodak's bankruptcy docket yesterday, Richard Pignataro and Cecil D. Quillen Jr. said that it is not fair for Kodak to reward executives while they and other former Kodak workers face the risk that the company could seek to trim or modify their benefits. Kodak’s plan proposes to set aside $8.8 million in cash and deferred stock for 15 "key management employees," including nine executives, deemed "essential" to Kodak’s ability to successfully restructure. Pignataro, who says that he is a Kodak retiree, wrote that he was "outraged" to learn that Kodak Chief Executive Antonio Perez would "even ask to be included" among the bonus recipients "after he led the company into bankruptcy." Perez's expected bonus payment would be 200 percent of his base salary, according to Kodak. The CFO’s target bonus would be 178 percent of his salary, while the other managers’ bonuses would range from 16 to 206 percent of their salaries.

Bankruptcy Judge Martin Glenn yesterday demanded more detail on a plan by Dewey & LeBoeuf to pay out as much as $450,000 in performance-based bonuses to employees helping to wind down the bankrupt law firm's operations, Reuters reported yesterday. Judge Glenn said that he wanted a list of the employees' salaries and the amount of bonus money to which they would be entitled under the plan. U.S. Trustee Tracy Hope Davis had objected to the plan, which would cover human resources, finance and IT personnel and billing and collection staff that agreed to stay and help wind down Dewey. Davis said that Dewey had not shown that it could afford the plan.

Bankruptcy Judge Douglas Tice has agreed to convert the chapter 11 case of RoomStore Inc. to a chapter 7 liquidation, effectively ending the retailer's efforts to remain in business, FurnitureToday.com reported yesterday. The ruling by Judge Tice means that a trustee will soon be appointed to oversee the sale of the company's remaining assets - primarily its 65 percent stake in bedding retailer Mattress Discounters and a distribution center in Rocky Mount, N.C. Yesterday's decision capped a struggle between RoomStore Inc. and its unsecured creditors committee that had become increasingly contentious in recent weeks as the two parties traded accusations of mismanagement in a series of court documents. RoomStore had asked Judge Tice to convert the case to chapter 7, but the committee filed a motion to keep the case in chapter 11 while appointing a trustee to oversee the wind-down of operations.

The bankruptcy trustee for Peregrine Financial Group on Monday asked a bankruptcy judge for extra time to file a full accounting of the failed futures brokerage's finances, saying that the books are too complicated to get the job done by the July 25 deadline, Reuters reported yesterday. Peregrine, whose CEO was arrested earlier this month after confessing to years of bilking customers out of more than $100 million, said at its July 10 bankruptcy filing that it had assets of between $500 million and $1 billion, and liabilities of between $100 million and $500 million. The CEO, Russell Wasendorf Sr., faces a bail hearing this Friday. The firm did not prepare any of the schedules documenting assets, liabilities or the firm's financial condition that are due within 15 days of a bankruptcy filing, and has no intention of doing so itself, trustee Ira Bodenstein said in a court filing on Monday. The trustee asked the judge to allow him to prepare the schedules himself, and said that doing so will take him another 43 days, until Sept. 6.

Peregrine Financial Group Inc.'s bankruptcy trustee obtained a federal court order clarifying his role in the marshaling of assets belonging to the collapsed commodity futures brokerage, Bloomberg News reported yesterday. U.S. District Judge Rebecca Pallmeyer yesterday granted trustee Ira Bodenstein's request after his lawyer told the judge that while $24 million in firm funds had been located, some banks holding that money would not allow them access to it because of her earlier restraining order in a lawsuit filed against Peregrine by the U.S. Commodity Futures Trading Commission. "At least one financial institution has expressed concern that its compliance with the trustee's request for the transfer of funds may violate the ‘asset freeze’ provisions of the order," Bodenstein's attorneys told Pallmeyer in a July 20 filing.