WSJcomBankruptcyBeat

Against criticism from the U.S. government’s executive-bonus watchdog, attorneys for American Airlines’ parent company defended the $20 million severance payment promised to departing Chief Executive Tom Horton, arguing the bill would be paid once the company merges with US Airways Group Inc. Read the Daily Bankruptcy Review article here.

Lawyers for Dish Network Corp. Chairman Charlie Ergen and Phil Falcone squared off in front of LightSquared’s bankruptcy judge Thursday, for the first time since Mr. Falcone sued Mr. Ergen over allegedly improper purchases of LightSquared’s debt. Read the Daily Bankruptcy Review article here.

Phil Falcone’s Harbinger Capital Partners LLC sued Dish Network Corp.Chairman Charlie Ergen for fraud, accusing him of secretly acquiring the debt of LightSquared Inc. in order to take control of the telecommunications firm and its wireless spectrum worth billions of dollars. Read the Daily Bankruptcy Review article via The Wall Street Journal.

Santa Clara County, Calif. was the first entity to register its appearance in the bankruptcy proceeding of Rural/Metro Corp., and it’s not the possibility the ambulance company’s behind on its taxes that has the county racing to court.

Santa Clara has been worried about the company that has its medical emergency services contract ever since private equity firm Warburg Pincus LLC took over in 2011, County Executive Jeffrey Smith said Monday. The leveraged buyout carried a $738 million price tag, $525 million of it in the form of new debt.

This week on The Broke and the Beautiful, rapper DMX filed for bankruptcy protection. Also, Teresa and Joe Giudice of Bravo’s “The Real Housewives of New Jersey” were charged with fraud, and fellow New Jersey “Real Housewives” star Danielle Staub settled a fraudulent-claims lawsuit.