The Daily Docket: Barnes Bay Reworks Bankruptcy-Exit Plan

Barnes Bay Development Ltd. is reworking its plan to exit bankruptcy protection under the control of Starwood Capital Group after a group of wealthy investors who put down millions of dollars in deposits on luxury Caribbean vacation residences complained they’re being short-changed. Read the Daily Bankruptcy Review story here.

Funds managed by billionaire Ron Burkle’s Yucaipa Cos. and by Fortress Investment Group LLC are seeking to push radio-station owner Inner City Media Corp. into Chapter 11 bankruptcy protection. Read the Daily Bankruptcy Review Small Cap story here.

(The Daily Bankruptcy Review and DBR Small Cap are daily newsletters with comprehensive coverage and analysis of emerging and in-progress insolvencies and turnarounds. For a two-week trial to DBR, click here. For DBR SC click here.)

A court-appointed trustee who is sifting through the wreckage of one of the biggest bank failures in U.S. history filed a lawsuit against Temple-Inland Inc., the former parent of Guaranty Financial Group Inc., contending that it loaded up the bank with risky securities and siphoned nearly $600 million in dividends from its coffers. Read The Wall Street Journal story here.

WSJ reports Cerberus Capital Management LP walked away from a deal to buy Innkeepers USA Trust, upending the hotelier’s plans to emerge from bankruptcy proceedings.

Over at Credit Slips, law professor Bob Lawless takes a look at recent newspaper story that he says misses the real reason why bankruptcy filing rates have eased slightly in the downturn.

UCLA law professor and Tribune Co. examiner Kenneth Klee says the law school is happy to take Lowell Milkens’s $10 million gift, reports DealBook.