All items from WSJ.com: Bankruptcy Beat

Joe Louis Arena in Detroit
Getty Images

The city of Detroit is tearing down the Joe Louis Arena, where the Detroit Red Wings play, and giving the redevelopment efforts to its holdout creditor, The Wall Street Journal reports.
The public bus operator in Santiago, Chile, filed for bankruptcy Thursday with plans to restructure $368 million in debt. Read 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.”)



Posted 5 weeks 1 day ago

The new Apple Watch is pictured during an Apple event at the Flint Center for the Performing Arts in Cupertino, California, in this file picture taken Sept. 9, 2014.
Reuters

Apple Inc. supplier GT Advanced Technologies Inc. has delayed a challenge to a court order cloaking information about the troubles believed to be responsible for the sapphire producer’s bankruptcy. 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.”)



Posted 5 weeks 2 days ago

Rhode Island’s Donald W. Wyatt Detention Facility has struggled since officials at U.S. Immigration and Customs Enforcement pulled out their detainees in 2008, following the death of a Chinese national held there. That pullout happened shortly after the facility expanded to hold 770 detained people.
The detention center, which owes about $97.3 million in bonds, was taken over by an outside financial professional earlier this year.
The facility is supposed to kick in money to the city of Central Falls, R.I., which had its own financial problems and eventually filed for bankruptcy in 2011. When the city’s lawyers redrew revenue forecasts as part of its financial revival, lawyers pointed out that they hadn’t been getting—nor did they expect to receive—payments from the facility, which takes in detained people from Rhode Island, Connecticut, Massachusetts, New Hampshire, Maine and Vermont, according to its website.
An article in Wednesday’s Wall Street Journal shows how some cities and states that took on risk to build jails or prisons are hurting after crime unexpectedly fell and the inmate population declined.



Posted 5 weeks 3 days ago

Marc Dreier
Associated Press

Marc Dreier won’t be leaving prison after all.
As Bankruptcy Beat has detailed, the disgraced former lawyer was scheduled to appear later this month in a New York courtroom to testify in a lawsuit tied to the bankruptcy of Mr. Dreier’s defunct law firm.
The suit, against a hedge fund that allegedly profited from Mr. Dreier’s long-running fraud, was settled Wednesday. The deal means Mr. Dreier can stay in the low-security federal prison in Minnesota where he’s serving out a 20-year sentence—the outcome he had been hoping for all along.



Posted 5 weeks 3 days ago

Tundra, the wolf grabs a popsicle made of chicken broth at Oatland Island Wildlife Center in Savannah, Ga., on July 2, 2014.
Steve Bisson/Associated Press

A Colorado wolf sanctuary filed for bankruptcy, blaming the devastation from the High Park wildfire that scorched roughly a third of the 162-acre property where its 30 wolves roam.
Sanctuary officials had to leave the nonprofit’s LaPorte, Colo., property for nearly a month after the fire broke out in June 2012, said W.O.L.F. Sanctuary (Wolves Offered Life & Friendship) executive director Shelley J. Coldiron.
The fire—one of the worst in the state’s history—burned about 87,000 acres and destroyed more than 250 homes. The sanctuary lost several sheds and storage facilities to the blaze and is still fighting an insurer to pay for $60,000 to cover the damage. The property has also flooded; some of the fire-scorched earth no longer absorbs water.



Posted 5 weeks 3 days ago

This Sept. 22, 2011 file photo shows the Trump Taj Mahal Casino Resort in Atlantic City, N.J.
Wayne Parry/Associated Press

Carl Icahn will move ahead on his plan to take over the Trump Taj Mahal even if the union representing more than 1,100 casino workers goes on strike, Allan Brilliant, attorney for the billionaire, told a bankruptcy judge Tuesday. 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.”)



Posted 5 weeks 3 days ago

An employee assists customers ordering baked goods during the reopening of a Crumbs Bake Shop Inc. store in New York on Tuesday.
Bloomberg

In a Midtown Manhattan storefront partially obscured by scaffolding, a crowd gathered Tuesday to welcome back Crumbs Bake Shop, the cupcake chain that shut its doors and filed for bankruptcy in July.
Two of the chain’s new owners, self-styled turnaround guru Marcus Lemonis and Scott Fischer, whose company also owns Dippin’ Dots, milled around the room. Employees, press reps and others from the new management team squeezed into the space not already occupied by hulking video cameras.
The crowd left little room for what some might call an important contingent—the customers.



Posted 5 weeks 4 days ago

Energy Future Holdings Corp. creditors have taken issue with the company’s proposal to auction its stake in Oncor, with some demanding greater access to the process and others questioning whether the sale is necessary at all. Read 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.”)
The Catholic Church in Minnesota and a lawyer for victims of sexual abuse on Monday announced the settlement in the first-of-its-kind lawsuit claiming that clergy abuse and subsequent inaction by church leadership constituted a “public nuisance.” Read the DBR article in The Wall Street Journal.
Bloomberg reports that Trump Entertainment Resorts Inc. is set to ask a bankruptcy judge Tuesday to let it terminate a union contract.



Posted 5 weeks 4 days ago

Endeavour International Corp., a Houston-based oil and gas company, filed for bankruptcy protection late Friday night as part of a debt-for-equity swap with bondholders that will slash about $568 million in debt off the company’s books, Daily Bankruptcy Review reports in The Wall Street Journal.
(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.”)
Alco Stores Inc . filed for Chapter 11 bankruptcy Sunday with plans to liquidate or sell the 113-year-old retail operation. WSJ has the DBR article here.
Apple Inc. supplier GT Advanced Technologies Inc. said closing its Arizona and Massachusetts factories to make artificial sapphire would cost 890 people their jobs, DBR reports via WSJ.



Posted 5 weeks 5 days ago

Federal Reserve Bank of Richmond President Jeffrey Lacker said Friday financial firms’ so-called “living wills” should do a lot to strengthen the financial system, if banks and regulators respect these plans.
The living wills in question are plans by financial companies detailing how they expect to be wound down in the event of running into trouble. Mr. Lacker, speaking in Chicago, said these plans are vital to ending the perception that many firms are considered to be too-big-to-fail and will be bailed out by the government in the event of trouble.
“Living wills offer us the only realistic path” to ending the ongoing belief that very large firms will get government bailouts, Mr. Lacker said in the text of his speech. While living wills “have not received as much attention as other regulatory and legislative responses to the crisis, they may be the most critical, and I applaud the hard work that is being done to make them credible.”
Mr. Lacker long has argued that the too-big-to-fail problem that played such a large role in the financial crisis was in part the fault of regulators and political authorities who couldn’t resist saving failing financial firms. He has pressed for strengthening the mechanisms available to help wind down a failing firm, and he believes that reducing the prospects of a government bailout reduces the odds a firm will make overly risky decisions that can result in failure.
Mr. Lacker also said in his speech the existing bankruptcy law could be effective in dealing with a failed financial firm.



Posted 6 weeks 1 day ago