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Wireless venture LightSquared has reached a deal to end its chapter 11 bankruptcy, but its largest creditor, satellite operator Charles Ergen, is not on board and "wasted the parties' time," according to a report from the court-appointed mediator, Reuters reported on Friday. The mediator, Judge Robert Drain, said that he believed the plan would be confirmable by the bankruptcy court judge overseeing the case even without Ergen's support. Judge Drain's report, made in a court filing on Friday, did not give details on the deal. LightSquared, which is owned by Phil Falcone's Harbinger Capital Partners, had accused Ergen of using underhanded methods to acquire his controlling stake of its debt. The dispute was sent to mediation after Judge Shelley Chapman rejected a restructuring proposed by LightSquared that would have pushed Ergen's repayment behind other creditors.

Settlement talks may be in the works as the long-running trial over Nortel Networks Corp.'s billions winds to a close this week, Dow Jones Daily Bankruptcy Review reported today. Lawyers who have been battling for at least three years over how to divide $7.3 billion raised in the liquidation of the onetime telecommunications giant last week filed court papers that refer to discussions that could end the fighting. Nortel's various national factions have been caught up in a pitched battle over how to allocate the company's money among competing national units. Judges in Toronto and Wilmington are reviewing the bond interest briefs filed this week by Nortel Canada and Nortel U.S., an exchange sparked when it was suggested that getting a fast answer on the bond interest rate could advance the cash trial.

Philip Falcone resigned from the board of LightSquared Inc., the bankrupt wireless-spectrum owner he has tried to build into a rival to U.S. mobile providers, amid negotiations with creditors to reorganize the company, Bloomberg News reported yesterday. Falcone and four other people appointed to the board by his Harbinger Capital Partners voluntarily resigned on June 12, according to a letter filed with the Federal Communications Commission and posted on the agency’s website. Falcone had been fighting to keep control of the company throughout its two years in bankruptcy. At one point, Dish Network Corp. Chairman Charles Ergen made a $2.22 billion offer for its assets, only to withdraw the bid at the last minute. Falcone accused Ergen of acquiring LightSquared debt improperly to game the bankruptcy process. Bankruptcy Judge Shelley Chapman rejected a Falcone-backed reorganization plan in May, saying that it was largely unfair to Ergen, while she also faulted Ergen’s behavior during the case. Since then, LightSquared and its creditors have entered court-supervised mediation to work out a new plan.

Southborough, Mass.-based data center services provider GlassHouse Technologies, poised to go public just a few years ago, has filed for chapter 7 bankruptcy, the Boston Globe reported today. The filing comes two months after GlassHouse sold its consulting division to Phoenix-based Signature Technology Group. In court documents, the company listed debts between $50 million and $100 million, owed to nearly 100 parties, and assets of less than $1 million. In the United Kingdom, a GlassHouse subsidiary owes money to that country’s customs and tax agency, according to British news reports.

Hedge-fund manager Philip Falcone is taking aim at the federal government over its refusal to authorize LightSquared to launch a wireless network, the Wall Street Journal reported on Saturday. In a letter addressed to the Federal Communications Commission, lawyers for Falcone's Harbinger Capital Partners LLC hedge fund complained that the "billions of dollars" it sunk into LightSquared has been for naught after regulators ordered an "indefinite halt" to further development of LightSquared's network. Without an operational network, which regulators said could interfere with global-positioning systems, LightSquared filed for chapter 11 bankruptcy protection in May 2012 and has since lost $1.3 billion, according to court papers. A bankruptcy judge recently threw out the company's restructuring proposal, leaving it with no immediate path out of chapter 11. In the letter, dated May 28, Harbinger's lawyers urged the FCC to take "immediate, positive action" in resolving the limbo in which LightSquared has languished for the past several years.

Phone service distributor TelexFree LLC has come under siege in recent weeks by federal prosecutors and securities regulators, which have alleged that the company is behind a $1 billion-plus pyramid scheme. Now, the company faces the daunting challenge of notifying hundreds of thousands of investors worldwide about its pending bankruptcy, according to a Wall Street Journal blog yesterday. Based in Marlborough, Mass., TelexFree used multilevel marketing to assist in the distribution of voice over Internet protocol (known as VOIP) telephone service plans for unlimited international calling to approximately 70 countries. Investors were promised annual returns of 200 percent or more for recruiting new members and placing TelexFree advertisements on free ad sites. According to court papers, TelexFree had about 700,000 such investors around the world. Since the company filed for bankruptcy protection in April, the Securities and Exchange Commission has filed civil fraud charges against the company, its owners and several of its most senior promoters, which the company disputes. The bankruptcy judge overseeing TelexFree’s chapter 11 case in Worcester, Mass., is expected to turn over control of the company to a trustee.

LightSquared and its creditors, including Dish Network Corp. Chairman Charles Ergen, will go into court-ordered mediation to settle on a plan to restructure the bankrupt wireless venture, Reuters reported yesterday. Bankruptcy Judge Shelley Chapman had given sides until yesterday to forge a consensual plan to get LightSquared out of chapter 11, or else mediate under Bankruptcy Judge Robert Drain. Paul Basta, a lawyer for an independent committee supervising the LightSquared restructuring, said yesterday that the sides had made some progress on a new deal but needed help getting "across the finish line."

An e-commerce company that once provided services to clients including the clothing lines of Victoria Beckham and Phillip Lim has declared bankruptcy, Crain’s New York Business reported today. Sellect Commerce, a Manhattan-based fashion-oriented e-commerce platform, filed for chapter 11 protection on May 16. Sellect helps fashion companies to speed up their websites, provides better tracking of orders and social media integration, and includes a simple user-face to upload and manage content. A year ago Sellect decided to hire additional coders to fix the site and at least retain its existing clients, but faced with a limited supply of available "ruby on rails" highly-proficient coders, Sellect brought in development company Cyrus Innovations to help fix the code. In the end, the hiring of Cyrus put a major strain on Sellect's finances. Cyrus currently holds a claim of $135,220 from Sellect.

Dish Network Chairman Charles Ergen scored a big win this month in the bankruptcy of wireless venture LightSquared, but the judge who delivered the ruling also had some harsh words for Ergen, and they could come back to haunt the chairman in a separate lawsuit in Nevada, Reuters reported yesterday. Bankruptcy Judge Shelley Chapman nixed LightSquared's proposed chapter 11 exit plan, which would have pushed Ergen behind other creditors. LightSquared had sued Ergen, accusing him of scheming to improperly take control of LightSquared by secretly acquiring its loans. Judge Chapman ruled only a piece of Ergen's debt deserved to be altered, so the restructuring plan was unfair. That should give Ergen leverage in negotiations on a new deal to restructure LightSquared, which is majority owned by Phil Falcone's Harbinger Capital Partners. But Ergen may have a harder time in a Nevada lawsuit, where shareholders claim he breached his fiduciary duty by amassing LightSquared debt on his own behalf, rather than letting Dish make a play for the company. The shareholders are seeking damages from Ergen and other Dish directors, saying the chairman's actions ultimately cost Dish a deal.

Creditors of bankrupt Bitcoin exchange Mt. Gox have until Nov. 28 to file proof of their claims, according to a notice from its trustee, PCWorld.com reported today. Attorney Nobuaki Kobayashi, the court-appointed bankruptcy trustee for the Tokyo exchange, posted a notice on the Mt. Gox website Wednesday with details of the liquidation procedure. Creditor claims will be examined starting Feb. 25, 2015, nearly a year to the day after Mt. Gox went bust with liabilities of ¥6.5 billion ($63.6 million). Creditors could include hundreds of thousands of users who deposited bitcoin with the exchange. When it collapsed, Mt. Gox said nearly half a billion dollars’ worth of bitcoin was unaccounted for and that hackers had exploited a software problem.