see bankruptcy reform update

Lisa J. Mellencamp
Enron North America Corp.
1400 Smith St.
Houston, TX  77002
Tel:  (713) 853-7986
Fax: (713) 646-3393
E-mail:  Lisa.Mellencamp@enron.com
----- Forwarded by Lisa Mellencamp/HOU/ECT on 12/13/2000 09:47 AM -----

	"William Rochelle" <wrochelle@fulbright.com>
	12/13/2000 09:08 AM
		 
		 To: undisclosed-recipients:;
		 cc: 
		 Subject: Fulbright Daily Bankruptcy News


FULBRIGHT & JAWORSKI L.L.P.
DAILY BANKRUPTCY NEWS

From: Wm. J. Rochelle, III
           Fulbright - New York

Wednesday, December 13, 2000

Filings:

 Flashcom Inc., a high speed internet reseller, filed chapter 11 on Friday in 
Santa Ana, Calif., and laid off one third of its workers.

 Golden West Tacos, Inc., the franchisee of 49 Taco Bell restaurants, filed 
chapter 11 last month in San Diego.

Updates:

 Unicapital Corp., the Miami based aircraft and equipment lessor that filed 
on Monday in New York, classifies as *significant* chapter 11 case.  The 
company has almost $650 million in two bank facilities and closed two 
securitizations in the last year for another $650 million.  See F&J Daily 
Bankr. News of Dec. 12.

 Lernout & Hauspie has decided to appeal last weeks decision from the 
Belgian court which denied the companys petition for protection from 
creditors on the ground that the *measures for restructuring were totally 
unsatisfactory.*  To complicate matters, the Belgian court has granted a 
shareholders request that prevents L&H from selling or pledging assets.  The 
company also is in chapter 11 in Delaware, but the U.S. court does not have 
power to prevent a European creditor from filing a lawsuit in Europe if the 
creditor has no presence in the U.S.  Also, L&H may be faced with conflicting 
court orders: the Belgian court precludes pledging assets although the U.S. 
court might authorize secured borrowing.  See F&J Daily Bankr. News of May 30 
and Oct. 6 & 8 of 97 and Oct. 27, Nov. 28 & 30 and Dec. 1, 4 & 8 of 00.
 Scour Inc. a/k/a scour.com, whose web site allowed users to exchange video 
and audio files, filed chapter 11 in October and auctioned its assets 
yesterday for $5.5 million cash and $3.5 million in stock of the winning 
bidder CenterSpan Communications Corp.  Scour has only $4 million in debt but 
is facing $250 billion (no typo) in copyright infringement claims. The bidder 
agreed not to use the assets in a manner that could bring more litigation.  
See F&J Daily Bankr. News of Oct. 13 and Nov. 2 & 20.

Downgrades:
 W.R. Grace & Co. is the latest asbestos defendant to lose investment grade 
status.  Yesterday S&P lowered the corporate peg to BB+.  Graces stock 
plunged 20% yesterday and is down 85% in the last year.  A $250 million bank 
credit matures in May and a second bank line is tapped out.  Stay tuned!  See 
F&J Daily Bankr. News of Oct. 9.

 MC Shipping Inc., a 21 vessel ship owner, tripled in size recently and now 
has been downgraded three time in the last eighteen months by S&P, which 
yesterday dropped the long term rating by another notch to a dangerous CCC.  
The corporate peg remains at B-.  The company is tendering for bonds at 54% 
of face.  See F&J Daily Bankr. News of June 10 of 99 and April 7 of 00.

 S&P downgraded Dade Behring Inc. eighteen months ago and took another swipe 
at the company yesterday, lowering the corporate and sub ratings by a notch 
to B and a troubling CCC+.  The maker of medical diagnostic equipment and 
supplies has $1.5 billion in rated debt.  S&Ps new ratings are one notch 
below the downgrade that Moodys handed out in October.  See F&J Daily Bankr. 
News of June 29 of 99 and Oct. 24 of 00.

Bankruptcy reform update:

 In an editorial today, The New York Times said that the bankruptcy reform 
bill is  *distorted* and a *handout to the credit card industry.*  The 
Hartford Courant today urged the President to veto the bill.  Other 
newspapers have advocated Presidential approval of the bill.

Latin America news:

 For the second time in a week, the Peruvian government has taken over a 
bank.  An insurance company also was taken over, and a Peruvian airline 
suspended domestic service.

Asia news:

 Asian markets were pleased that the U.S. may now know who its president is.  
However, the Japanese yen dropped to a 16 month low against the dollar, to 
the pleasure of Japanese exporters.  Consumer prices in Tokyo have fallen 
1.2% from one year ago, reflecting how Japans problem is deflation, not 
inflation.


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 - bknews.wpd