Late the night of Nov. 25, LandAmerica Financial Group, Inc. and its subsidiary, LandAmerica 1031 Exchange Services, Inc., filed a Chapter 11 petition in the U.S. Bankruptcy Court for the Eastern District of Virginia ("Bankruptcy Court"), seeking bankruptcy protection for both entities. The action does not cover Commonwealth Land Title Insurance Company or Lawyers Title Insurance Company, two LandAmerica subsidiaries that are each domiciled in the State of Nebraska.

As the Seventh Circuit has recently made clear in Airadigm Communications, Inc. v. FCC, bankruptcy courts have the discretion under Bankruptcy Code §524 to approve a release contained in a Plan of Reorganization of a party which did not seek bankruptcy protection. Such a non-debtor release is more likely to be approved by the bankruptcy court where the creditors do not object to the confirmation of the Plan or vote to approve the Plan.

As our economy slides into what could be a long and severe recession, retail bankruptcies are expected to increase. Landlords are presented with a myriad of problems when one of their tenants files for bankruptcy. Although many of the obligations and rights of landlords are well established by current bankruptcy law, a novel question arises when a tenant files for bankruptcy while a landlord is in the process of constructing tenant improvements or is on the verge of providing a tenant allowance. Given the tenant’s right to reject its lease, a landlord is faced with a difficult decision.

On November 14, 2008, a letter was sent to derivatives counterparties of Lehman Brothers Holdings Inc. and its affiliates (collectively, “Lehman”) notifying them of Lehman’s Motion to Settle or Assign Derivative Contracts. The letter concerns a motion filed in the bankruptcy court by Lehman Brothers Debtors on November 13, 2008, which seeks to establish two procedures relating to its pre-petition derivative contracts with counterparties.

In Henderson v. Powermate Holding Corp. (In re Powermate Holding Corp.)1, the United States Bankruptcy Court for the District of Delaware became the second bankruptcy court to address the status of WARN Act claims after the 2005 amendments to section 503 of the Bankruptcy Code.

In ABN Amro Bank N.V. v. Parmalat Finanziara S.p.A. (In re Parmalat Finanziara S.p.A.),1 the United States District Court for the Southern District of New York affirmed the Bankruptcy Court’s entry of an injunction pursuant to former section 304 of the Bankruptcy Code (the precursor to current chapter 15, applicable in crossborder insolvency proceedings), which prevented the beneficiary of a guaranty governed by New York law from asserting its guaranty claim against Italian debtor (and guarantor) Parmalat S.p.A. (“Parmalat”) in the United States.

AUTOMOTIVE

EZ Lube LLC, Express Lube Inc. filed for Chapter 11 protection in Delaware.  

Key Plastics files prepackaged Chapter 11 petition; secured $20M in DIP financing.  

Precision Parts International filed Chapter 11 petition; commences winding down operations.  

BROADCASTING

Equity Media Holdings, Corp. filed for Chapter 11; secured lender seeks conversion to Chapter 7  

ENERGY  

A federal bankruptcy court, applying New York law, has dismissed an adversary proceeding brought by a bankrupt home mortgage company against its directors and officers liability insurers, holding that coverage for a pre-petition lawsuit against the mortgage company was barred by application of an “inadequate consideration” exclusion. Delta Fin. Corp. v. Westchester Surplus Lines Ins. Co., Case No. 07-11880 (CSS) (Jointly Administered) (Bankr. D. Del. Dec. 15, 2008). The court also held that the coverage dispute was a non-core proceeding.

Buckling under roughly $13 billion in debt, broadcast and print media giant Tribune sought protection from creditors with the filing of a Chapter 11 petition in a Delaware bankruptcy court on Monday. Based in Chicago, the Tribune Company owns the Chicago Tribune, the Los Angeles Times, and ten other newspaper properties scattered across the nation’s largest media markets. The company also owns 23 broadcast television stations, cable TV super station WGN, major league baseball’s Chicago Cubs, and Wrigley Field.

In In re River Center Holdings, LLC,1 the United States Bankruptcy Court for the Southern District of New York refused to permit lenders to enforce an oral commitment of the debtors’ principal to fund certain litigation. In River Center, the debtors’ principal had stated at a hearing that he would fund a condemnation action relating to property that served as collateral for the lenders’ financing.