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Tribune, Trump, Lyondell, Fontainebleau: Bankruptcy

Updated on

April 13 (Bloomberg) -- Newspaper publisher Tribune Co. filed a Chapter 11 plan yesterday to implement the settlement with some creditors that was announced on April 8. The plan and settlement won’t be approved if the holders of $3.6 billion in pre-bankruptcy secured debt made valid arguments in their bankruptcy court filing yesterday.

The settlement will be discussed at a hearing today on a motion by Tribune for an expansion of the exclusive right to solicit acceptances of the reorganization plan.

The lenders, who say they have 42 percent of the secured debt under the May 2007 credit agreement, said the settlement is “premature and misleading.” Contending that the settlement would compel “them to pay for the alleged sins of others,” the lenders explain how they are giving up value when other targets of fraudulent transfer claims pay nothing while receiving releases and indemnities.

The lenders object to how Sam Zell, who led the $13.8 billion leveraged buyout in December 2007, pays nothing while receiving a release. Similarly, the lenders contend that affiliates of JPMorgan Chase & Co., Citigroup Inc. and Merrill Lynch & Co. likewise receive releases while giving up nothing, while they were the ones who formulated the transactions.

The lenders say there is “no conceivable scenario” where they can be forced to give up value where other participants in the LBO surrender nothing, including banks that already received $2 billion.

The lenders say it understandable why unsecured creditors support the settlement. The lenders argue that unsecured creditors are indifferent to the source of the payment that enhances their recoveries.

Tribune filed its plan and explanatory disclosure statement yesterday. The plan proposes a 52.6 percent recovery for holders of $10.34 billion in secured loans guaranteed by the subsidiaries. The class is to receive 91.2 percent of the new stock, 91.2 percent of a new secured term loan, and 91.2 percent of distributable cash, less cash going to other specified creditors.

The holders of the $1.28 billion in senior notes are slated for a 35.2 percent recovery by receiving 7.4 percent of the new stock, 7.4 percent of distributable cash, and 7.4 percent of the new secured term loan.

General unsecured creditors of the subsidiaries are to be paid in full, without interest, so long as their claims in the aggregate don’t exceed $150 million.

The holders of the $761 million in so-called PHONES and $235 million EGI-RB LLC notes are to receive nothing.

The settlement and the plan are based on an assumption that distributable value is $6.1 billion.

As an alternative to the settlement and Tribune’s plan, the objecting lenders are asking the bankruptcy court to end Tribune’s so-called exclusivity so they can file a reorganization plan that would allow the fraudulent transfer dispute to go forward.

The settlement is supported by the official creditors’ committee, JPMorgan, and Centerbridge Partners LP, the holder of 37 percent of the senior notes.

The Tribune case has been stuck in disputes over the LBO. Creditors have been taking the position that the LBO was a fraudulent transfer because operating subsidiaries put liens on their assets to finance the Zell acquisition while not receiving commensurate value in return. Tribune has been advocating a settlement through a plan as the best outcome.

Tribune is the second-largest newspaper publisher in the U.S. It listed $13 billion in debt for borrowed money and assets of $7.6 billion in the Chapter 11 reorganization begun in December 2008. It owns the Chicago Tribune, Los Angeles Times, six other newspapers and 23 television stations.

The case is In re Tribune Co., 08-13141, U.S. Bankruptcy Court, District Delaware (Wilmington).


Judge Confirms Trump Plan, Turns Back Icahn Proposal

A New Jersey bankruptcy judge filed a 121-page opinion yesterday saying she would confirm the Chapter 11 plan for casino owner Trump Entertainment Resorts Inc. that was proposed by the company and holders of 8.5 percent senior notes. Although she said it, too, was confirmable, Chief U.S. Bankruptcy Judge Judith H. Wizmur turned aside the competing plan proposed by Carl Icahn, who controls the first-lien debt.

While Wizmur said the Trump plan would leave the company with more debt, she said that the advantages included the ability to continue using the Trump brand and quicker approval from New Jersey gaming regulators.

A deciding factor for Wizmur was the vote by holders of the $1.2 billion in second-lien notes. Eighty percent in amount voted for the Trump plan while 84 percent voted against the Icahn plan.

The Trump plan will reduce debt by $1.4 billion while paying the first-lien debt in full, Wizmur said.

The contested confirmation hearing began Feb. 23 and wrapped up on March 10.

For a comparison of the two plans, click here to see the Jan. 7 Bloomberg bankruptcy report.

Trump Entertainment, the owner of three casinos in Atlantic City, New Jersey, filed for Chapter 11 reorganization for a second time in February 2009. The new petition listed consolidated assets of $2.06 billion against debt totaling $1.74 billion. Listed liabilities included $1.25 billion in second-lien notes, $489 million in first-lien bank debt with Beal as agent, $33.2 million in trade debt, and $6 million in liabilities on leases, according to a court filing.

The companies own the Trump Taj Mahal Casino Resort, the Trump Plaza Hotel and Casino and the Trump Marina Hotel Casino. The new filing came less than four years after emerging from a prior bankruptcy reorganization.

The case is In re TCI 2 Holdings LLC, 09-13654, U.S. Bankruptcy Court, District of New Jersey (Camden).

Georgia-Pacific May Delay Lyondell Plan Confirmation

Georgia-Pacific LLC raised an objection that might cause a delay in the confirmation hearing for approval of the reorganization of chemical producer Lyondell Chemical Co.

Atlanta-based Georgia-Pacific contends in its April 9 bankruptcy court filing that it’s not being given the requisite 30 days’ notice of settlement of $5.5 billion in environmental claims against Lyondell.

Georgia-Pacific, a pulp, paper and building products producer, contends that federal environmental law requires 30 days’ notice of a hearing to compromise a governmental environmental claim. Lyondell is giving only 15 days’ notice so the previously scheduled plan confirmation hearing can go ahead April 23.

Georgia-Pacific says that neither the court nor the government has the ability to shorten the notice period designed to give other affected parties an opportunity to comment on the proposed settlement.

Under the proposed settlement, Lyondell will transfer specified environmentally impaired properties it owns to a trust along with cash to perform a cleanup. The U.S. government and seven states will have approved unsecured claims aggregating $1.18 billion. In addition, Lyondell will contribute $108.4 million cash to the trust and pay another $61.6 million to settle other claims.

To read about the plan and the settlement with the unsecured creditors’ committee, click here and see the Lyondell item in the March 9 Bloomberg bankruptcy report.

Lyondell and affiliate Equistar Chemicals LP, together making up the third-largest independent producer of chemicals, filed under Chapter 11 in January 2009, listing assets of $33.8 billion and debt totaling $30.3 billion. The parent LyondellBasell Industries AF SCA filed under Chapter 11 in April. Including the parent and European subsidiaries, the assets were $40 billion in September 2008. Total revenue in 2007 was $44 billion. The Lyondell petition says its assets are $27.1 billion against $19.3 billion in debt while Equistar’s’ listed assets and debt both totaling $9 billion.

The case is Lyondell Chemical Co., 09-10023, U.S. Bankruptcy Court, Southern District of New York (Manhattan).

Fontainebleau Seeks Conversion to Ch. 7 Liquidation

Fontainebleau Las Vegas LLC, the owner until recently of an uncompleted 63-story hotel and casino on the north end of the Las Vegas Strip, filed a motion on April 9 asking the bankruptcy judge in Miami to convert the Chapter 11 case to a liquidation in Chapter 7 where a trustee will be appointed automatically.

Authorized by the bankruptcy court in late January, Fontainebleau sold the project on Feb. 18 to a company affiliated with Carl Icahn for about $150 million. Icahn’s price includes the assumption of financing for the Chapter 11 case.

Fontainebleau takes the position that it has an absolute right to convert the case to Chapter 7 and believes conversion can take place without holding a hearing. The conversion motion gave no reason for requesting conversion.

Cases are sometimes converted from Chapter 11 to Chapter 7 where there are insufficient assets to pay professional fees for an ongoing Chapter 11 case once the assets are sold.

The Fontainebleau project was to have 3,815 rooms. Assets and debt both exceed $1 billion, the petition says.

The case is In re Fontainebleau Las Vegas Holdings LLC, 09-21481, U.S. Bankruptcy Court, Southern District Florida (Miami).

Woodbridge Partnership Can Be Assumed, Abitibi Says

AbitibiBowater Inc., the largest newsprint maker in North America, argued in an April 9 bankruptcy court filing that it has the right to assume and continue operating under a partnership agreement regarding a mill in Augusta, Georgia.

Woodbridge Co., Abitibi’s partner in the plant, contended in a motion last month that bankruptcy law doesn’t permit assumption of a partnership agreement without its consent.

Abitibi countered by pointing to a December 2007 letter agreement where Woodbridge consented to an assumption of the partnership agreement in a reorganization. A hearing on the Woodbridge motion is scheduled for May 26.

Abitibi, in its papers, said its current intention is to assume the partnership agreement. In the meantime, Abitibi wants the bankruptcy court to extend the time for the formal decision on assumption until the as-yet-to-be-filed reorganization plan is confirmed.

In Chapter 11 petitions filed in April 2009, the combined AbitibiBowater companies listed assets of $9.9 billion and debt totaling $8.8 billion as of September 2008. The plan-approval process may be slowed by defects the creditors’ committee believes it found in parts of a $400 million term loan made in April 2008.

The committee contends that the loan was a fraudulent transfer as to subsidiaries who guaranteed the new debt although they were not obligated on the debt being paid off or refinanced.

AbitibiBowater was formed in October 2007 through a merger between Montreal-based Abitibi-Consolidated Inc. and Greenville, South Carolina-based Bowater Inc. Abitibi is a producer of newsprint, uncoated mechanical paper and lumber. Bowater also makes newsprint along with papers, bleached kraft pulp and lumber. The Montreal-based company began reorganizing with 24 pulp and paper mills plus 30 wood-product plants. Revenue in 2008 was $6.8 billion.

The case is AbitibiBowater Inc., 09-11296, U.S. Bankruptcy Court, District of Delaware (Wilmington).

Black Crow Beats Back GECC, Seeks More Exclusivity

Two days after Black Crow Media Group LLC filed under Chapter 11 in January, the secured lender General Electric Capital Corp. filed a motion to dismiss the case and followed up with a motion to modify the so-called automatic stay so it could foreclose the business.

Last week the bankruptcy judge denied both of GECC’s motions. Black Crow, a closely held owner of 22 radio stations, followed up on April 9 with a motion asking the bankruptcy judge in Jacksonville, Florida, to extend the exclusive right to propose a Chapter 11 plan until Sept. 9.

The judge also approved $1.5 million in financing that GECC had opposed.

Black Crow filed for Chapter 11 protection two days before a hearing in U.S. district court for the appointment of a receiver on account of Black Crow’s default on $38.9 million in term loans and a revolving credit owing to GECC.

Black Crow’s stations are in five markets in Florida, Alabama, Georgia and Tennessee. In addition to the GECC debt, there is $6 million owing to unsecured creditors.

Daytona Beach, Florida-based Black Crow had $12.9 million of revenue in 2009, a 23 percent decline from 2008.

The case is In re Black Crow Media Group LLC, 10-00172, U.S. Bankruptcy Court, Middle District Florida (Jacksonville).

Prive Nightclub in Las Vegas Gives up Reorg Hope

The owner of the Living Room and Prive, adjacent nightclubs inside the Planet Hollywood Resort and Casino in Las Vegas, was unable to negotiate lease concessions from the landlord and filed a motion last week to dismiss the Chapter 11 case begun in November.

The nightclubs explained how they owed a net of $440,000 to the landlord for rent arrears and other expenses. In addition, there are $1.5 million in mechanics’ liens on the property that would have to be paid were the nightclubs to remain in operation under the existing lease.

The motion for dismissal is set for a May 4 hearing. The nightclubs see no purpose to a conversion of the case to a liquidation in Chapter 7.

The nightclubs opened last year.

The case is In re Prive Vegas LLC, 09-34880, U.S. Bankruptcy Court, Southern District Florida (Miami).

Titlemax Files Full-Payment Plan for All Creditors

Titlemax Holdings LLC, a lender providing loans to individuals secured by their lien-free automobiles, won approval of a full-payment Chapter 11 plan at a confirmation hearing yesterday, a company lawyer said.

Secured lender Merrill Lynch Mortgage Capital Inc., owed $149.5 million, will be paid off with a new, two-year note. Subordinated noteholders owed $4.7 million will receive new notes. General unsecured creditors with $2.5 million in claims likewise will be paid in full, with interest. Owners retain their stock.

Titlemax filed for reorganization in April 2009 in its Savannah, Georgia, hometown. To read Bloomberg coverage, click here.

The disclosure statement says the assets are $301 million against debt totaling $183 million. The company says it’s one of the largest auto title lenders, with 500 locations in five states. It makes loans to people “without access to traditional credit alternatives,” the Web site says.

The case is Titlemax Holdings LLC, 09-40805, U.S. Bankruptcy Court, Southern District of Georgia (Savannah).

Tamarack Resort Ends Up in Chapter 11 Following Chapter 7

Tamarack Resort LLC, a golf and ski resort in Valley County, Idaho, won’t be liquidated in Chapter 7 after all. Instead, the bankruptcy judge granted the resort’s motion on April 9 and converted the case to a reorganization in Chapter 11.

Tamarack opposed an involuntary Chapter 7 petition and lost in an opinion handed down on March 17 by a U.S. bankruptcy judge in Boise, Idaho. Tamarack conceded it wasn’t paying debts as they mature.

The bankruptcy judge granted the motion for conversion to Chapter 11 even though the Chapter 7 trustee had been named on March 23.

The creditors filing the involuntary petition included an affiliate of Bank of America Corp. owed $4.7 million.

The project’s 27.5 percent owner, VPG Investments Inc., filed for Chapter 11 reorganization in 2008. The petition was dismissed in October 2008. VPG was controlled by Mexican businessman Alfredo Miguel Afif.

The new case is In re Tamarack Resort LLC, 09-03911, U.S. Bankruptcy Court, District of Idaho (Boise). The previous case was In re VPG Investments Inc., 08-00253, U.S. Bankruptcy Court, District of Idaho (Boise).

Nova Biosource Dismissed With Features of Chapter 11 Plan

Nova Biosource Fuels Inc., the owner of two non-operating biodiesel plants, prevailed on the bankruptcy judge to agree to dismiss the reorganization on terms that include some features of a Chapter 11 plan.

Once the previously approved sale of assets is completed, the bankruptcy judge in Delaware provided in his April 9 order that the Chapter 11 case will be dismissed. In the sale, the buyer will assume $36 million in secured debt and the loan provided by the secured creditor to finance the Chapter 11 case.

Along with dismissal, the lender will deposit $200,000 into a trust for distribution only to unsecured creditors. Costs incurred in the Chapter 11 case are to be paid separately. The bankruptcy judge reserved the right to decide how much professionals will be paid.

The bankruptcy judge provided in the dismissal order that he won’t have power to resolve disputes about distributions from the liquidating trust.

The Chapter 11 petition in March 2009 listed $110 million in both assets and debt.

Debt includes a $36 million credit agreement for one plant and $55 million in secured convertible notes. Trade suppliers were owed another $12 million.

The case is In re Nova Holdings Clinton County LLC, 09-11081, U.S. Bankruptcy Court, District of Delaware (Wilmington).

Recticel Confirms Plan After Modifying Contracts

Recticel North America Inc. and affiliate Recticel Interiors North America LLC won approval of their reorganization plan when the bankruptcy judge signed a confirmation order on April 9. The plan gives full payment to all creditors of the manufacturers of foams used in autos and bedding.

Unsecured creditors voted on the plan because they aren’t receiving interest on their claims.

The companies sought Chapter 11 protection to deal with unfavorable contracts with their two largest customers, Johnson Controls Inc. and Inteva Products LLC. The disputes were resolved by modifying the contracts.

The Auburn Hills, Michigan-based companies together reported revenue of $69.6 million in 2008 and $28.3 million for the first nine months of 2009. Combined assets are $13.9 million, with combined debt totaling $105.9.

The companies are subsidiaries of Brussels-based Recticel SA.

The case is In re Recticel North America Inc., 09-73411, U.S. Bankruptcy Court, Eastern District Michigan (Detroit).

RathGibson Sets May 21 Plan Confirmation Hearing

RathGibson Inc., a manufacturer of welded tubing products, scheduled a May 21 confirmation hearing for approval of the Chapter 11 plan after the bankruptcy judge approved the explanatory disclosure statement last week.

For details about the plan, click here to see the March 11 Bloomberg daily bankruptcy report.

The bankruptcy judge previously scheduled a May 19 auction where the first bid of $93 million cash will come from a group including some of the existing secured lenders and holders of 70 percent of the $209.5 million in 11.25 percent unsecured notes.

The sale finances the plan that is built around a settlement with creditor groups.

The original plan was negotiated with holders of 73 percent of the senior unsecured notes before the Chapter 11 filing in July.

The Lincolnshire, Illinois-based company listed assets of $305 million against debt totaling $319 million. In addition to $209 million in senior notes, debt included $55.3 million on secured credit agreements and $10.4 million owing to trade suppliers. The holding company was also liable on $115 million in pay-in-kind notes. A group including management and an affiliate of DLJ Merchant Banking Partners acquired control of RathGibson in June 2007.

The case is In re RathGibson Inc., 09-12452, U.S. Bankruptcy Court, District of Delaware (Wilmington).

Spheris Makes February Profit Before Interest and Fees

Spheris Inc., a transcriber of medical dictation for doctors and hospitals, reported a $2.1 million net loss in February following the Chapter 11 filing Feb. 3.

Net revenue in the month was $10.97 million, resulting in $1.16 million in earnings before interest, taxes, depreciation, amortization and reorganization costs. For the month, interest expense was $1.85 million, and professional fees were $1.45 million.

Unless there is a higher offer at auction today, the business will be sold for $75.25 million cash to subsidiaries of CBay Holding Ltd.

Franklin, Tennessee-based Spheris listed assets of $61 million against debt totaling $225 million. Liabilities include $75.6 million on a senior secured credit and $125 million on subordinated notes. For nine months ended in September, revenue was $120 million.

The case is In re Spheris Inc., 10-10352, U.S. Bankruptcy Court, District of Delaware (Wilmington).

Watch List

Harrisburg to Miss May Payment on Incinerator Debt

The Harrisburg Authority, operator of a trash-powered energy plant in Pennsylvania’s capital city, said it won’t make a $425,282 interest payment due May 1 on $17 million in bonds issued in 2002.

The city this year is facing $68 million in debt payments for the incinerator. The payments are four times the city’s income from property taxes.

The insurer of the bonds, Assured Guaranty Municipal Corp., said it would make payments of principal and interest.

To read Bloomberg coverage, click here.

Briefly Noted

Six Flags Files Revised Credit Agreements for Plan

Theme-park operator Six Flags Inc., scheduled for approval of the revised reorganization plan at an April 28 confirmation hearing, submitted revised first- and second-lien credit agreements yesterday, along with a revised incentive plan for managers. The amended plan was filed April 2 to implement the settlement announced in bankruptcy court on March 19. The settlement ended a contested confirmation hearing that began March 8. To read about the amended plan, click here to see the April 5 Bloomberg bankruptcy report. The Six Flags Chapter 11 petition in June listed assets of $2.9 billion against debt totaling $3.4 billion, including a $850 million secured term loan and a $243 million revolving credit. New York-based Six Flags filed under Chapter 11 with 20 theme parks, including 18 in the U.S. The parks have 800 rides, including 120 roller coasters. The case is Premier International Holdings Inc., 09-12019, U.S. Bankruptcy Court, District of Delaware (Wilmington).

Sawgrass Golf Resort Has Cash Use Through May

The owner of the Sawgrass Marriott Resort in Ponte Vedra Beach, Florida, won an extension until May 28 of the ability to use cash representing collateral for the claim of secured creditor Goldman Sachs Mortgage Co. The resort filed under Chapter 11 on March 1 in Jacksonville, Florida, saying assets and debt both exceed $100 million. The case is In re RQB Resort LP, 10-01596, U.S. Bankruptcy Court, Middle District of Florida (Jacksonville).

Meruelo Maddox Committee May File Plan in May

The creditors’ committee for Meruelo Maddux Properties Inc., a Los Angeles-based developer and manager of commercial and multifamily residential property, received permission to file a Chapter 11 plan on May 18. The order from the bankruptcy judge early this month otherwise precludes other creditors from filing a plan before June 11. The Chapter 11 petition filed in March 2009 listed assets of $682 million against debt totaling $342 million. The case is In re Meruelo Maddux Properties Inc., 09-13356, U.S. Bankruptcy Court, Central District California (Los Angeles).

Citadel Has Exclusivity Beyond May 12 Confirmation

As an insurance policy against a delay in confirmation of the reorganization plan, Citadel Broadcasting Corp. sought and received an extension until July 19 of the exclusive right to propose a Chapter 11 plan. The confirmation hearing for approval of the plan is set for May 12. Citadel is a Las Vegas-based owner of 224 radio stations. The secured lenders and the creditors’ committee are in agreement with the plan following a settlement improving treatment of unsecured creditors. To read about the plan, click here for the March 16 Bloomberg bankruptcy report. Citadel, which operates in more than 50 markets, filed the original version of the plan on Feb. 3 to carry out agreement negotiated before the Chapter 11 filing in December. Citadel and subsidiaries listed assets of $1.4 billion against debt totaling $2.46 billion. It is the third-largest radio station owner in the U.S., with 166 FM and 58 AM stations. The 24 stations in large markets were acquired in a June 2007 merger transaction with Walt Disney Co. where Disney shareholders received 57.5 percent of Citadel’s stock and Disney received $1.35 billion cash. Citadel also distributes programming to 4,000 stations. The plan originally was negotiated with holders of 60 percent of the senior debt. The case is Citadel Broadcasting Corp., 09-17442, U.S. Bankruptcy Court, Southern District New York (Manhattan).


Mirant-RRI Merger Precipitates Three IPP Downgrades

The announcement on April 11 that RRI Energy Inc. would merge in an all-stock transaction with Chapter 11 veteran Mirant Corp. prompted Standard & Poor’s to issue downgrades yesterday to three independent power producers.

Dynegy Inc., an independent power producer based in Houston, saw the corporate rating slip one click to B-, the same downgrade that was issued simultaneously to Edison Mission Energy and subsidiary Midwest Generation Company LLC. Edison Mission and Midwest had been downgraded two notches by S&P in July.

For Houston-based RRI, the rating moved down one peg to B.

S&P noted that Dynegy, Edison Mission and RRI had total debt of $6.45 billion, $6.50 billion and $3.2 billion, respectively, at the close of 2009.

American Residential Lowered on Debt-Funded Dividend

American Residential Services LLC, a provider of ventilation, plumbing, sewer and drain-cleaning services for residential and commercial customers, saw the corporate rating lowered one notch yesterday to B3 on the scale of Moody’s Investors Service.

Moody’s was reacting to the increase in the new second-lien note offering from $150 million to $165 million.

The new secured debt will be used to repay existing obligations and fund a dividend to shareholders.

The rating on the new second-lien notes likewise was lowered to B3.

Based in Memphis, Tennessee, ARS operates through 66 branches in 23 states.

Advance Sheets

Anna Nicole Smith Estate Asks for En Banc Rehearing

Although former Playboy model Anna Nicole Smith died in February 2007, her lawsuit lives on against the estate of Texas billionaire J. Howard Marshall. The lawyers for Smith’s estate filed a motion last week asking all the active judges on the 9th U.S. Circuit Court of Appeals to rehear the case that resulted in a March 19 opinion by a panel of three judges dismissing her suit.

To read details about the March decision, click here to see the Advance Sheets item in the March 22 Bloomberg bankruptcy report.

The three-judge panel concluded that Smith’s compulsory counterclaim wasn’t a so-called core proceeding, with the result that the bankruptcy judge couldn’t issue a final order. Before the judgment of the bankruptcy judge passed through the U.S. District Court, a state court in Texas entered judgment against Smith, saying she was entitled to nothing from her deceased husband’s estate. Consequently, three judges from 9th Circuit in San Francisco said she lost the race to judgment because the district court was bound to follow the state court that was the first to issue a final judgment.

On the bankruptcy law issue, the 9th Circuit said that a compulsory counterclaim isn’t a core proceeding unless it is “so closely related to the proof of claim that the resolution of the counterclaim is necessary to resolve the allowance or disallowance of the claim itself.”

In the petition for rehearing, the lawyers for Smith’s estate contend that three other circuit courts plus a plethora of lower courts have held that there is always core jurisdiction over compulsory counterclaims. They pointed to opinions from the courts of appeal in Boston, New York and New Orleans as ruling the other way.

Smith’s estate wants a so-called en banc rehearing before all of the active judges on the 9th Circuit so the San Francisco court will have a chance to line up with sister courts.

Should the circuit court decline to rehear the case, Smith’s estate can file a petition asking for the U.S. Supreme Court to hear an appeal. On other issues, the case has been to the Supreme Court once already, with a result in Smith’s favor. Smith lost when the case was remanded from the Supreme Court.

The case is Marshall v. Stern (In re Vickie Lynn Marshall), 02-56002, 9th U.S. Circuit Court of Appeals (San Francisco).

To contact the reporter on this story: Bill Rochelle in New York at

To contact the editor responsible for this story: David E. Rovella at

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