Forward Motions: Trump Taj Mahal to Fight for Survival

A courtroom showdown over the fate of Trump Entertainment Resorts Inc. is scheduled for Thursday—the day before the deadline originally set for the closure of the company’s Trump Taj Mahal casino on the Atlantic City, N.J., boardwalk.

A Wilmington, Del., bankruptcy judge has ordered Trump Entertainment lawyers to prove that they have a realistic game plan to keep the Taj Mahal from closing. Without one, the company’s case could be pushed into a Chapter 7 liquidation.

The company has pushed back the target closing date to Dec. 20 from Dec. 12, citing talks that could save the casino and hotel.

To keep the casino open, officials have been negotiating cost-cutting moves with a union that represents more than 1,000 workers. Billionaire Carl Icahn and several companies he controls bought Trump Entertainment’s secured loans during the company’s last bankruptcy in 2009, positioning him to take over the property. He has agreed to pump in new money as long as the union and the state of New Jersey agree to concessions.

If the Taj Mahal shuts down this month, it would make the Taj Mahal the fifth casino to have closed on Atlantic City’s boardwalk this year. The second casino owned by Trump Entertainment Resorts—the Trump Plaza—closed shortly after the bankruptcy filing.

Recently introduced state legislation could ease the tax burden on casinos that are trying to stay on their feet in Atlantic City. Trump Entertainment was asking for some $175 million worth of government support as the price for bailing out a gambling enterprise that has stumbled through one bankruptcy after another.

On Tuesday, Dendreon Corp. executives will ask a Delaware judge for permission to hold a Feb. 3 bankruptcy auction for its operations, which make drugs that fight prostate cancer.

In earlier court papers, Dendreon requested a Jan. 27 bid deadline for buyers who want to challenge a lead offer from the Seattle biotechnology company’s creditors.

Dendreon has an agreement with a significant majority of its bondholders, led by Deerfield Management Co., that gives it until next year to find a buyer. Court papers say bondholders will take bids in excess of $275 million for Dendreon.

If no prospective buyers step up, bondholders would swap out their debt for equity in the reorganized company.

Dendreon filed for bankruptcy on Nov. 10 after its prostate cancer treatment Provenge failed to catch on with doctors.

On Wednesday, a New York-based olive importer accused of marketing an industrially processed product as pure olive oil could get one step closer to leaving bankruptcy.

Kangadis Food Inc. officials will ask a Central Islip, N.Y., bankruptcy judge to approve a creditor payment plan that includes $2 million to settle a class-action lawsuit. Kangadis filed for bankruptcy in June to stop mounting legal costs from that class-action suit.

The class-action lawsuit followed an earlier lawsuit brought by the North American Olive Oil Association, which alleged that Kangadis Food labeled some of its Capatriti products as “100% pure olive oil” when they were actually made of a byproduct called olive pomace oil. Kangadis reached a confidential settlement with the trade organization without admitting liability.

Kangadis Food is owned by Themistoklis Kangadis, Aristidis Kangadis and Andromahi Kangadis. Under its proposed bankruptcy-exit plan, Themistoklis Kangadis would become the sole owner of the reorganized business and pump up to $1 million of new money into the company, which was founded in 2003.

-Sara Randazzo contributed to this post.

Write to Katy Stech at [email protected] and Peg Brickley at [email protected]