• Desperate Housewife Eva Longoria in Desperate Bankruptcy Trouble over Nightclub

    The closing of the nightclub Eve, partly owned by “Desperate Housewives” star Eva Longoria, has set off a new round in the legal battle for control of its bankrupt parent company, Beso, LLC. The nightclub is located in the Crystals mall in Las Vegas.

    Ronen Nachum, a Beso creditor, and Mali Nachum, part owner, asked U.S. Bankruptcy Court Judge Mike Nakagawa to place a trustee in charge of Beso shortly after the closure of the nightclub. The judge denied the request to move quickly on the matter, but left open the possibility of hearing the request on a normal timeline.

    Beso owed Crystals mall, part of MGM Resorts International’s CityCenter complex, $2.3 million in back rent at the time of filing for Chapter 11 in January 2011. The mall is the largest creditor in the case. Beso has run up hundreds of thousands of dollars more in unpaid bills since the filing.

    Eve was the only nightclub at Crystals, and tried to position itself as a Las Vegas magnet for entertainment celebrities with Longoria as the marquee owner.

    However, infighting among the owners erupted in 2010 which lead to a protective order being issued against Ronen Nachum.

    Bank account garnishments, unpaid rent to Crystals, a contractor’s lien and ongoing losses drove Beso to file bankruptcy in spite of grossing $14.6 million in 2010.

    Benjamin Brand Services – Chicago bankruptcy attorney

  • Bankrupt Owner of Spiegel Brands Runs into Trouble with Bidding Procedure

    Signature Styles, owner of Spiegel Brands and other clothing companies, has run into trouble with their Chapter 11 bankruptcy. The trustee in the case told a bankruptcy judge that Signature Styles shouldn’t receive approval of its proposed bidding procedures.  Signature Styles is a division of private equity firm Patriarch Partners and was formed to purchase Spiegel Brands in 2009.

    Under the procedures, Artemiss LLC, a newly formed division of Patriarch Partners, is to become the stalking horse bidder in exchange for assumption of $30 million in debt.

    Court documents show that the official committee of unsecured creditors in the case is “gravely concerned that the sale process currently proposed by the debtors is woefully deficient, crafted solely to benefit Patriarch, provides no benefit to the debtors estates and is nothing more than half-hearted window dressing intended to cloak Patriarch’s efforts to cleanse the debtors’ balance sheet of unsecured indebtedness with the appearance of fairness and equity.”

    The committee asked the court to take an active role in the sale process by soliciting alternative sales proposals. If the court chooses a stalking horse bidder, the process moves to a 363 sale auction. Multiple parties are invited to the auction and could outbid Artemiss and buy the company.

    Artemiss wins the auction at the agreed upon price provided no other party outbids them.

    The Spiegel company originated in Chicago in 1865.

    Benjamin Brand Services  – Chicago bankruptcy attorney