Forward Motions: Caesars Heads Back to Court

On Wednesday, Caesars Entertainment Operating Co. is scheduled for its next major bankruptcy-court hearing in Chicago, during which the company will ask a federal judge to halt four creditor lawsuits brought against the company’s non-bankrupt parent for asset transfers made before CEOC’s chapter 11 filing.

Caesars is arguing that allowing these lawsuits to proceed could “imperil” CEOC’s ability to reorganize.

CEOC pointed out in court filings that while the suits against it are automatically halted by the bankruptcy code, suits against parent Caesars Entertainment Corp. and other affiliates not in bankruptcy should also be stopped during the chapter 11 case. CEOC said if they aren’t, money its parent has pledged as part of a proposal to restructure more than $18 billion in debt could be tied up in that litigation.

If the suits against the parent and other non-bankrupt affiliates go on, CEOC said, “it would be nearly impossible for CEC to provide any substantial contribution to a reorganization, including the $1.5 billion that it has agreed to contribute.”

Each of the four lawsuits is slightly different, but they share the same theme: Creditors say Caesars entities shifted good assets away from them to benefit its owners, including private-equity firm Apollo Global Management LP. No fewer than seven transactions between 2009 and 2014 have been questioned.

Exide Technologies Inc. is on Friday requesting bankruptcy-court approval of its bankruptcy-exit plan, which would essentially conclude the company’s second bankruptcy case.

If approved, the plan would slash $600 million in debt from Exide’s balance sheet by handing ownership of the company to institutional investors.

However, the plan is facing some challengers.

The city of Frisco, Texas, objected to Exide’s restructuring proposal earlier this week, seeking to force the company to clarify its plans for the remediation of contaminated land, ground water and nearby creeks.

The city called the damage one of the most significant of Exide’s environmental liabilities and estimated remediation will cost approximately $35 million to $40 million in addition to post-closure costs of about $12 million.

Airline catalog retailer SkyMall LLC will put its assets on the auction block on Wednesday and by Friday is slated to ask for court approval of the results of that auction.

The company hasn’t named a lead bidder for the auction, but offers were due March 19.

SkyMall filed for chapter 11 bankruptcy in January. The company’s recent turbulence is the result of an “intensely competitive” retail environment stemming from evolving rules and technology that now allows airline passengers keep their smartphones and tablets powered up during flight, acting Chief Executive Scott Wiley said in court papers.

“With the increased use of electronic devices on planes, fewer people browsed the SkyMall in-flight catalog,” he said.

The SkyMall retail business had revenue of about $33.7 million in 2013, but only $15.8 million for the nine months ended Sept. 28, 2014.

-Joseph Checkler, Peg Brickley and Tom Corrigan contributed to this article.

Write to Stephanie Gleason at [email protected]. Follow her on Twitter at @StephGleason