Circuit court voids finance technique used in bankruptcy

Article Abstract:

A federal appeals court has held in In re Saybrook Manufacturing Co that the Bankruptcy Code does not permit the 'cross-collateralization' means of financing. Use of this method gets the lender a secured interest in assets obtained by the business during the bankruptcy. It constitutes a lien against all debt outstanding prior to and after the Chapter 11 petition. The court ruled that cross-collateralization was not in accord with the priority scheme.

Priorities of claims and liens

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Law firms make towering claims; they say Steven Hoffenberg of Towers Financial stiffed them

Article Abstract:

Steven N. Hoffenberg's Towers bankrupt Towers Financial Corp is a defendant in many suits for large amounts of unpaid fees by various New York law firms. Hoffenberg's troubles started when settled an SEC charge of securities fraud in 1988. Bankruptcy ensued when the SEC froze his assets after a bid to buy the failing New York Post and again charged him with securities fraud. Hoffenberg is using the defense tactic that the law firms overcharged him.

Debtor and creditor, Towers Financial Corp.

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As Macy's fees mount, judge issues a warning; so far, $2.6 million granted in latest mega-bankruptcy

Article Abstract:

Judge Burton R. Lifland of the R.H. Macy and Co bankruptcy litigation has warned attorneys in the case that he expects time spent on the case and subsequent fee requests to go down in the future. So far, the judge has approved $2.6 million in legal fees and $355,000 in expenses for the period from Jan 27 to Apr 30, 1992. The three law firms are Weil, Gotshal and Manges; Otterbourg, Steindler, Houston and Rosen; and Berlack, Israels and Liberman.

Attorneys, Lawyers' fees, R.H. Macy & Company Inc.

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