ABI Blog Exchange

In a Radio Shack Bankruptcy Watch at CommercialBankruptcyInvestor.com, Chris Cahill discusses  Radio Shack’s financial difficulties and its impact on its commercial landlords. Read more about it here
34 min 41 sec ago
This Dec. 27, 2013, photo shows the exterior of Caesars Atlantic City in Atlantic City N.J.
Associated Press
After a heated venue fight that concluded with Caesars Entertainment Corp.’s bankruptcy remaining in Chicago, not in Delaware, the company returns to the Windy City Monday for its second courtroom appearance there. Caesars put its largest unit into bankruptcy protection in Chicago Jan. 15, days after a group of creditors filed an involuntary Chapter 11 against the company in Delaware. A Delaware judge ultimately agreed to let Caesars proceed with its restructuring of $18.4 billion of debt in Chicago, but he had some harsh words for its private-equity owners about a series of financial maneuvers designed to salvage their investment in the casino giant. Caesars, its owners, and their “suspect” dealings will be “under a magnifying glass” in Chicago, Judge Kevin Gross of the U.S. Bankruptcy Court in Wilmington, Del., said at a recent hearing, calling into question moves the company and its owners Apollo Global Management LLC and TPG made before the bankruptcy filing.

Read More from: WSJ.com: Bankruptcy Beat

38 min 27 sec ago
This is the bankruptcy case study for E.A. from Montgomery, Kendall County, Illinois. He is here to see whether chapter 13 bankruptcy will provide debt relief for him. Let’s look at the facts of his case: he is currently a homeowner with a market value of $149,000. (www.zillow.com)He has two outstanding loans on the property.+ Read More The post Bankruptcy Case Study-Chapter 13: Get Current On Mortgage appeared first on David M. Siegel.
40 min 40 sec ago
A group of Atlantic City, N.J., casino workers rallied outside billionaire Carl Icahn ’s Manhattan office Thursday to protest benefit cuts made as part of a protracted battle to keep the Trump Taj Mahal from closing. The Wall Street Journal has the Daily Bankruptcy Review article here. (Daily Bankruptcy Review is a daily newsletter with comprehensive coverage and analysis of emerging and in-progress insolvencies and turnarounds. For a two-week trial, visit our homepage, scroll to the bottom and click “try for free.”) Valeant Pharmaceuticals International Inc. said it reached a tentative deal to buy a prostate-cancer drug and other assets from Dendreon Corp., WSJ reports. DBR(sub. req.) reports that Revel Casino Hotel’s lender and creditors are close to a deal.

Read More from: WSJ.com: Bankruptcy Beat

1 hour 33 min ago
Two Republican legislators have suggested that affordable housing funding should be put on hold until Congress finally decides what to do about Fannie and Freddie. But why give Congress another six years to fiddle around with housing finance while the poor and homeless face a declining level of government housing assistance?

Read More from: BankThink

1 hour 55 min ago
From January 23-27, 2015, Charles A. Stanziale, Jr., as the Chapter 7 Trustee (the “Trustee”) of Powerwave Technologies, Inc. (“Powerwave” or the “Debtor”), filed approximately 102 preference complaints seeking to avoid and recover alleged preferential transfers pursuant to Sections 547 and 550 of the Bankruptcy Code. Background By way of background, Powerwave filed a petition for bankruptcy in the District of Delaware on January 28, 2013 under Chapter 11 of the Bankruptcy Code.  On June 11, 2013, the Court entered an Order converting the Debtor’s Chapter 11 case to a case under Chapter 7 of the Bankruptcy Code. McCarter & English, LLP represent the Trustee in these various preference cases.  The pretrial conference has not been scheduled.  These adversary actions, as well as the Debtors’ bankruptcy proceeding, are before the Honorable Mary Walrath. Defenses to a Preference Action The Bankruptcy Code provides creditors with many defenses to preference actions. Included among these are the “ordinary course of business defense” and the “new value defense.” For reader’s looking for more information concerning claims and defenses in preference litigation, attached is a booklet that we prepared on the subject: “A Preference Reference: Common Issues that Arise in Delaware Preference Litigation.”
1 hour 58 min ago
Shio-kara, or salted squid guts, is shown in this company photo served over rice.
Minoya Kichibee
A steamed fish-paste maker founded during the feudal era in the 16th century filed for court protection under Japan’s bankruptcy laws after more than 450 years in business, the company said Friday. Minoya Kichibee, based in Odawara, Kanagawa prefecture, was founded around 1550 and sells items including pickled plums, salted squid guts and fish-paste products. It is now being managed by the 22nd owner in company history, a spokesman at the company told Japan Real Time. Minoya Kichibee filed at the Odawara branch of the Yokohama District Court on Wednesday with approximately ¥3 billion ($25 million) in liabilities, according to the company. It will continue operations while seeking rehabilitation under court supervision, the spokesman said. He declined to give the reasons for the filing.

Read More from: WSJ.com: Bankruptcy Beat

2 hours 5 min ago
Receiving Wide Coverage ... Deutsche Downer: Deutsche Bank's quarterly results beat analysts' expectations, but the bar was pretty low to begin with given that analysts had forecast a loss. "A single quarter aside, the performance of the stock and of the company has simply been poor," writes the Financial Times' Lex team. The column recommends Deutsche consider spinning off "some or all" of its retail banking units and consider boosting returns by growing its asset management...

Read More from: BankThink

3 hours 39 min ago
I just finished discussing the “random walk” theory in my Corporate Finance class, so I thought I would close out my stint on Credit Slips with some “random thoughts” on reform. First, two expressions of sincere gratitude: I want to thank Bob Lawless and everyone at Credit Slips for the opportunity to blog about reform these past two weeks. It has been great fun. I also would like to thank the many practitioners, judges, financial advisors, academics, and industry groups who participated in the ABI Commission reform study process. Everyone made a meaningful contribution to the project. 

Read More from: Credit Slips

4 hours 43 min ago
Branch Bank & Trust Co. v. Michael’s Enterprises of Virginia, Inc. (In re Michael’s Enterprises of Virginia, Inc.), 519 B.R. 916 (Bankr. E.D. Va. 2014)  – A mortgage lender sought sanctions against the debtor, its sole shareholder and its attorney.  It … Continue reading →
4 hours 55 min ago
I want to take up Michelle Harner's call for "innovation and new approaches to valuation". Valuation may well be the most important issue in bankruptcy, and it is also the issue that is least subject to meaningful judicial review. Imagine a Court of Appeals trying to parse through discounted cash flow models or what are proper comparables. The lack of meaningful appellate review makes it all the more important that we get valuation right.  Our current valuation system is fundamentally adversarial.  Both sides put up evidence in the form of valuation compurgators experts, and the court then has to decide on a valuation, which need not be either of the experts'. The use of expert witnesses always has problems--the expert is employed by a litigant, which creates a concern about expert objectivity.  (I say this as someone who sometimes serves as an expert witness.) The normal solution in our litigation system is to have experts are paid for their time, not their opinions (which are their own) or the results in the case.

Read More from: Credit Slips

14 hours 44 min ago
I have had bankruptcy clients who have been overly concerned with their credit score before, during, and after they have filed for bankruptcy. The credit industry, including the credit bureaus and the credit protectors, have done a great job of marketing to Americans the importance of having a good credit score. What they fail to+ Read More The post There Is Way Too Much Emphasis On A Credit Score appeared first on David M. Siegel.
20 hours 33 min ago
In section IV.E of its report and recommendations of reforms to chapter 11 of the Bankruptcy Code, the American Bankruptcy Institute Commission to Study the Reform of Chapter 11 (the “Commission”) considered changes to the Bankruptcy Code’s “safe harbor” provisions. Generally, the filing of a bankruptcy case immediately triggers the application of the automatic stay and other protections that prohibit collection efforts and the enforcement of contractual rights against the debtor, including contractual rights of termination. The Bankruptcy Code’s safe harbor provisions exempt (as their colloquial name implies) certain financial and derivatives contracts from sections 362 and 365(e)(1), which, respectively, impose the automatic stay and prohibit the enforcement of ipso facto clauses – i.e., a contractual clause that is triggered upon the debtor’s bankruptcy filing – to the extent those sections would prevent certain counterparties from exercising certain contractual rights to terminate, liquidate or accelerate safe harbored contracts.
20 hours 34 min ago
Join us for Episode 20 of Accredited Investor Markets Radio, a discussion with Ron Miller of StartEngine. Host and Managing Editor of AccreditedInvestorMarkets.com, Alicia Purdy, chats with Ron about why unaccredited investors could be a boon, rather than a threat, to crowdfunding. Ron also weighs in on the effects unaccredited investors can have in the startup space, how an accredited investor can best navigate this new territory and what StartEngine has been working on, including growing an equity crowdfunding platform.   You can find out more about crowdfunding and equity crowdfunding by visiting www.aimkts.com   You can learn more about Ron Miller and StartEngine here.   He can also be found here: Ron Miller Twitter: @ronstartengine StartEngine Twitter: @StartEngineLA Ron Miller: LinkedIn StartEngine : LinkedIn   About Ron Miller:
20 hours 36 min ago
Kicking the can down the road doesn’t seem to work for many distressed companies. The percentage of repeat defaulters since the Great Recession is running at more than double the historical average. That suggests that lax credit markets allowed troubled companies to paper over their problems without fixing them, according to a report Thursday by Moody’s Investors Service.

Read More from: WSJ.com: Bankruptcy Beat

20 hours 44 min ago
Kicking the can down the road doesn’t seem to work for many distressed companies. The percentage of repeat defaulters since the Great Recession is running at more than double the historical average. That suggests that lax credit markets allowed troubled companies to paper over their problems without fixing them, according to a report Thursday by Moody’s Investors Service.

Read More from: WSJ.com: Bankruptcy Beat

20 hours 44 min ago
Much is being made of American Airlines' "bold" decision to avoid hedging its fuel costs. I fully believe that corporations engage in way too much hedging, mostly to the benefit of big financial institutions. But let's be clear, a just out of bankruptcy counterparty is not going to be doing a lot of swaps deals anyway.

Read More from: Credit Slips

21 hours 23 min ago
Emanuel Grillo has joined the bankruptcy and workouts group at Baker Botts. Mr. Grillo, who will be a partner at the firm, has represented creditors, debtors and trustees in restructurings. He has worked on such bankruptcy cases as Lehman Brothers Holdings Inc., Delphi Corp. and Silicon Graphics Inc. Most recently, Mr. Grillo was a partner with Goodwin Procter. He is a member of the American Bankruptcy Institute and the Turnaround Management Association. Marc S. Kirschner has joined Goldin Associates as senior managing director and member of the management committee. He has been an adviser and trustee in bankruptcy matters and has worked with companies like Tribune Co., Yellowstone Mountain Club and Refco. Mr. Kirschner is a fellow of the American College of Bankruptcy.

Read More from: WSJ.com: Bankruptcy Beat

21 hours 38 min ago
Emanuel Grillo has joined the bankruptcy and workouts group at Baker Botts. Mr. Grillo, who will be a partner at the firm, has represented creditors, debtors and trustees in restructurings. He has worked on such bankruptcy cases as Lehman Brothers Holdings Inc., Delphi Corp. and Silicon Graphics Inc. Most recently, Mr. Grillo was a partner with Goodwin Procter. He is a member of the American Bankruptcy Institute and the Turnaround Management Association. Marc S. Kirschner has joined Goldin Associates as senior managing director and member of the management committee. He has been an adviser and trustee in bankruptcy matters and has worked with companies like Tribune Co., Yellowstone Mountain Club and Refco. Mr. Kirschner is a fellow of the American College of Bankruptcy.

Read More from: WSJ.com: Bankruptcy Beat

21 hours 38 min ago
What you did last year may come back to bite your family  when you file bankruptcy. Even if not fatal, the bite can  leave scars. I sat waiting for my turn at a bankruptcy hearing last week and watched a series of other cases that left blood in the water. The trustee’s feeding frenzy in at least three cases centered on payments or transfers the debtor  made to family before they filed their bankruptcy case. In some cases, the debtor was repaying money lent by family.  In others, it appeared the debtor had simply made a gift to family. In the worst case, it looked like the debtor had transferred a car to keep it out of the bankruptcy. All of those transfers spelled trouble. In each case I watched, the Chapter 7 trustee continued the hearing for the production of documents, the amendment of schedules, or further questioning. In several, she wanted the debtor to agree to give her a longer period to challenge their very right to a bankruptcy discharge. None of this bodes well for the debtor. Here’s why. The long arm of the law Bankruptcy law gives the trustee legal rights to recover, for the benefit of creditors, property or money the debtor has transferred.  Collectively, those are the avoiding powers.
22 hours 9 min ago

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