Beazer Homes USA Inc., an Atlanta, Ga,. homebuilder, fired its chief accounting officer for allegedly trying to destroy internal documents.  Both the Federal Bureau of Investigation and the Department of Housing and Urban Development have been investigating Beazer for alleged improper lending practices. A number of top Beazer executives have departed in recent months to take jobs at other companies, but over the winter Beazer fired its general counsel for behavior including violation of certain company policies.

Bally Total Fitness Holding Corp. said that it is seeking noteholder approval for a plan to reorganize under chapter 11 protection, the Associated Press reported today. The fitness center operator is asking holders of senior notes due 2011 and senior subordinated notes due 2007 to vote on the plan. Bally expects to continue normal club operations during the process and throughout its anticipated chapter 11. Last week Bally entered an agreement with the noteholders to vote in favor of the reorganization. The plan would increase the annual interest rate on the senior notes and allow Bally to keep cash that would have been used for a July 15 interest payment. Senior subordinated noteholders would receive rights to participate in a $90 million rights offering of new senior subordinated notes.

See Also:  Bankruptcy Lawyers New York

A merger of the American Bankers Association and America’s Community Bankers has been approved by the two groups’ boards, with a goal of completing the deal by the end of the year, CongressDaily reported today. The new entity will keep the American Bankers Association’s name and ABA president and CEO Ed Yingling will remain in that position. The current president and CEO of America’s Community Bankers, Diane Casey-Landry, will be the new group’s executive vice president and chief operating officer. ABA Chairman Earl McVicker said the merger would combine the best attributes of the two organizations, which are both more than 100 years old and represent banks of all sizes and charter types.

A bankruptcy court in Manhattan has approved Parmalat Finanzaria SpA’s bid for a permanent injunction barring creditors from litigating pre-petition claims against the Italian food and dairy giant in the United States, Bankruptcy Law360 reported yesterday. Though U.S. Bankruptcy Judge Robert Drain signed off on the injunction Thursday, it was narrowed after creditors, including Bank of America, objected. Creditors with pre-petition claims against Parmalat must now lodge them in Italy. However, if creditors take their claims to Italy and feel like they didn’t get fair treatment, they can come back to the Manhattan bankruptcy court and seek to modify the injunction. Bank of America’s rights in its ongoing litigation with Parmalat in district court will not be affected, and Parmalat’s nondebtor subsidiaries are not shielded by the injunction.

While a plunge in the Thai baht 10 years ago sparked a wave of recessions across Asia’s high-flying economies, bankrupting nations - putting millions out of work and shaking markets around the world - the recovery has been uneven, the Associated Press reported yesterday. Today, the region as a whole has bounced back from the 1997-98 crisis and is better equipped to deal with financial emergencies. Banking is more transparent, corporations are better managed, poverty rates have dropped and the region’s collective economic growth has doubled. The three countries hit hardest by the crisis that began July 2, 1997 – Thailand, Indonesia and South Korea – have charted sharply divergent paths over the last 10 years, reflecting their differing responses to the crisis and policies since then. South Korea, which received a humiliating $58 billion bailout arranged by the International Monetary Fund, quickly cleaned up its banking system and started reforming its heavily indebted family-owned conglomerates. Indonesia, however, has struggled and Thailand hovers somewhere in between.

Citing assets of $53,923 and debts of $7.6 million, DOBI Medical International Inc. has filed for bankruptcy protection, NorthJersey.com reported today. The Mahwah, N.J.-based medical-device maker, which furloughed all of its workers a year ago, has been developing an imaging machine intended to improve doctors’ ability to diagnose breast cancer. Bankruptcy papers were filed last week in federal court in Newark, N.J. A list of DOBI’s 20 largest creditors contained in court papers included Phillip Thomas of Kinnelon, who is owed $280,000; Marcon Mahwah LLC, $100,000; and Frank Puthoff of Mahwah, $80,000. Read more.

The Securities and Exchange Commission (SEC) voted yesterday to end price restrictions on short selling, meaning that investors seeking to sell a share that they do not own will no longer be barred from doing so because the price of the stock is falling, the New York Times reported today. The 5-to-0 vote, ending a rule that had been in place since 1938, when short sellers were blamed by some critics for having caused the 1929 market crash and the Depression that followed, came as the commission also voted to make it harder to engage in naked shorting, the practice of selling shares that have not been purchased or borrowed. SEC chairman Christopher Cox called naked short selling “a fraud that the commission is bound to prevent and to punish.” The SEC adopted a rule, known as Regulation SHO, in 2004 that was intended to reduce naked short selling by requiring the publication each day of a list of securities with heavy fails. Brokers are required to cure the fails within 13 days. But fails existing before the stock went on the list were grandfathered. Yesterday’s vote will remove the grandfather provision, and the commission said it was also considering removing an exemption from the rule for options market makers who need to sell short to hedge an options position.

Pittsburgh Brewing Co. received approval yesterday to emerge from bankruptcy protection with new ownership and the name that the iconic western Pennsylvania brewery started with nearly 150 years ago: Iron City Brewing Co., the Associated Press reported. Bankruptcy Judge M. Bruce McCullough approved the bankruptcy plan yesterday after months of negotiations between the company and its creditors. The company had originally sought bankruptcy protection in 2005 after the city Water and Sewer Authority threatened to cut off its water supply because of $2.5 million in unpaid bills. The company, founded in 1861, disputed the charges but agreed in April to settle its debt with the authority by paying at least $575,000.

Dell Inc., Round Rock, Tx., will slash its 88,000-strong workforce by 10% over the next year in the computer company’s first personnel downsizing in six years.  The cutbacks are in response to a review of its costs and its efforts to restructure and revise its business model. While Dell itself didn’t reveal how much money the cutbacks will save it, an outside analyst estimated that savings could reach $600 million. Also, Dell, under heavy competitive pressure from Hewlett-Packard Co., reported flat net income of $759 million in its first quarter, including a $46 million charge related to related to a Securities and Exchange Commission investigation into its accounting and finances.  Revenue for the quarter rose 3%–to $14.6 billion.

Bankruptcy courts routinely acknowledge state court expertise in financial and non-financial domestic relations matters.  Consequently, bankruptcy courts usually abstain from domestic relations matters and remand them to stat courts or expressly grant relief from the stay under §362(d) to permit state courts to resolve them.
Actions to determine the division of property attendant upon dissolution of the marriage are still stayed by a bankruptcy.  Thus, to pursue these matters in state court, a litigant must still obtain an order lifting the stay.  Many bankruptcy courts previously allowed property rights to be determined but prohibited the actual property division until the bankruptcy case was concluded.  It is reasonable to assume that this practice will continue after the 2005 amendments.  In many jurisdictions, trustees often agreed to relief from the stay but reserved the right to approve any determination of property rights.  This practice, too, is likely to continue after the 2005 amendments.

See Also: Chapter 7 Bankruptcy