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Sears Chairman Lampert Makes $4.6 Billion Bid for Bankrupt Retailer

Sears Holdings Corp. Chairman Eddie Lampert’s ESL Investments Inc. has made an offer valued at $4.6 billion to buy the bankrupt U.S. retailer, one of the only options that would prevent the department store chain from shutting its doors for good, Reuters reported. Lampert’s offer calls for about 500 Sears stores to remain open and would keep 50,000 of the retailer’s workers employed, according to a letter from his hedge fund filed yesterday with the Securities and Exchange Commission. The 125-year-old company faces a series of deadlines this month to find a buyer that would keep it in business as some of its creditors call for it to shut down, claiming they would be repaid more through going-out-of-business sales. Preliminary indications of interest for Sears assets were due on Wednesday, according to court papers.

Mission Coal Receives $145 Million Purchase Offer from Lenders

Lenders to Mission Coal Co. have extended a $145 million offer to buy the bankrupt mining company’s operations in Alabama and West Virginia, WSJ Pro Bankruptcy reported. In court papers filed on Wednesday, Mission Coal asked a federal judge to set a Jan. 21 bid deadline for other buyers who want to put in purchase offers for the Kingsport, Tenn., company, which primarily sells coal to steel producers. The company has blamed its financial problems on the cost of repairs needed to get mining operations up and running. The offer came from unidentified lenders who have formed an entity called New Coal Acquisition Co. If additional bids emerge, Mission Coal has proposed holding an auction on Feb. 27, with a sale hearing slated for March 20. Bankruptcy Judge Tamara Mitchell set a Dec. 19 hearing to go over the sale deadlines, which require her approval.

Senior Care Centers Wins Approval to Use Cash

Senior Care Centers LLC, which operates about 110 facilities in Texas and Louisiana, took its first steps under bankruptcy protection during its debut hearing yesterday, WSJ Pro Bankruptcy reported. Judge Douglas Dodd of the U.S. Bankruptcy Court in Dallas said that he would give a green light to the operator of the hospice, skilled-nursing and assisted-living facilities to begin using its lenders’ cash collateral, pending certain changes, to keep day-to-day operations running smoothly. The Dallas-based company filed for chapter 11 protection on Tuesday, saying that at this time, it doesn’t need any additional financing to help get it through bankruptcy. It said that it plans to tap existing cash collateral from secured lenders that include CIBC Bank USA, CIT Finance LLC, MB Financial Bank NA, Bankers Trust Co., Wells Fargo Bank NA and Compass Bank. Senior Care has total liabilities of $267.9 million. That includes $45.6 million in principal and interest outstanding under a credit facility consisting mostly of more than $33 million owed on a revolving loan on which the group of banks holds liens.

Scottsdale Attorney Gets Prison in Bankruptcy Fraud Case

A Scottsdale attorney has been sentenced to 18 months in prison and ordered to pay nearly $1.4 million in restitution in a bankruptcy fraud case, the Associated Press reported. Prosecutors say that Scott Allan Maasen previously pleaded guilty to one count of concealment of assets in bankruptcy. He must pay restitution to the U.S. Small Business Administration. Maasen filed for bankruptcy in 2009 after he stopped making payments on a $1.5 million loan. As part of his plea, Maasen admitted he purchased a $90,000 engagement ring for his fiance while his bankruptcy proceedings were pending. Prosecutors say Maasen used a credit card and bank accounts in his father’s name to make the payments to give the false appearance that Maasen’s dad had bought the ring.

As Buffalo Catholic Diocese Faces Potential Bankruptcy, CFO Resigning

Steven Timmel, the Buffalo Catholic Diocese’s chief financial officer, is resigning, another one of Bishop Richard Malone’s staff members to step down over the past year as the diocese continues to handle its clergy abuse scandal, WBFO.org reported. Villanova Professor Emeritus of Church Management Charles Zech said that few diocese CFOs have faced a situation like this. If the Child Victims Act were to pass in New York, it could ease current statutes of limitations for criminal and civil sex abuse cases. It could take a year for victims to step forward in the legal battle, which could lead to the diocese declaring bankruptcy, another process that would take additional time. Unless settlements are reached separately, Zech said it could take five years before the dust settled.

Bankruptcy Protects Detroit from Claims by Exonerated Youth, Judge Rules

Detroit is protected from an exonerated youth’s wrongful prosecution suit because of the city’s 2013 bankruptcy, approved in late 2014, a federal judge has ruled, the ABA Journal reported. U.S. District Judge David Lawson ruled on Tuesday that Davontae Sanford couldn’t recover from the city of Detroit, even though his murder conviction wasn’t vacated until July 2016. Sanford had been arguing actual innocence since at least 2008, making his claim “in fair contemplation” before the city declared bankruptcy, Judge Lawson said. Courthouse News Service covered the decision. Judge Lawson ruled that Sanford can still sue two police officers, however. Sanford also received $408,000 from the state of Michigan in a compensation program for wrongfully convicted people.
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