TCR_Public/980312.MBX T R O U B L E D   C O M P A N Y   R E P O R T E R
     Thursday, March 12, 1998, Vol. 2, No. 49                

BRUNO'S: Committee Objects to Change of Venue
CUSTOM-CRYOGENIC: Reports Recent Corporate Developments
EXCALIBUR FINANCIAL: Asks to Reject Executory Contracts
FOXMEYER CORPORATION: Trustee Seeks Claims Team
HOSPITAL STAFFING: Selling Nursing Division

INPHOMATION: NationsBank Sues Owner
OMNI MULTIMEDIA: Creditors Seeking Firm's Liquidation
ONEITA INDUSTRIES: Needs Time for Lease Determination
ONEITA INDUSTRIES: Taps Ordinary Course Attorneys
PARAGON TRADE: Debtor Responds to Procter & Gamble

PARAGON TRADE: Responds to Motion to Compel
PHELPS TECHNOLOGIES: Bar Date Fixed on March 31, 1998
PHELPS TECHNOLOGIES: Court Approves Professionals
PHELPS TECHNOLOGIES: Extension for Lease Evaluation
PHOENIX INFO: Equity Replies to Objections for Counsel

RELIANCE ACCEPTANCE: Committee Seeks Co-Counsel
TELECOMMUNICATIONS: WorldCom Objects to Houlihan
SAMSUNG MOTORS: Hopes for Deal with Ford
SMITH TECHNOLOGY: Applies to Employ Deloitte & Touche
VENTURE STORES: Seeks Time to Assume or Reject Leases
WELCOME HOME: Seeks Extension of Exclusivity


BRUNO'S: Committee Objects to Change of Venue
The Official Committee of Unsecured Creditors of PWS
Holding Corporation, Bruno's, Inc. et al., debtors
objects tot he motion of the creditors and shareholders
and collective bargaining representatives for a change of
venue to the Northern District of Alabama.  

The Committee argues that in selecting Delaware as the
venue for their Chapter 11 cases, the debtors fixed on a
site that is accessible and acceptable to all of their
major creditor constituencies.  The Committee agrees that
the majority of the debtors' stores, and the debtors
headquarters are in Alabama, together with the debtors'
employees and the law firms located in Alabama.  However,
the Committee states that it is more important that the
major creditor constituencies, that is the banks, who in
this case are located in New York and New Jersey, and who
go to court on a regular basis, and are responsible for
the financial restructuring of the debtor, should be
close to the court.

The Committee also states that the efficient and economic
administration of these cases is better served in
Delaware, although the reasoning for this also seems to
be that Delaware is closer to the offices of the creditor

CUSTOM-CRYOGENIC: Reports Recent Corporate Developments
Custom Cryogenic Grinding Corporation announced that its
Lender has demanded payment in full of the indebtedness
owing by Custom Cryogenic Grinding Corporation
incorporated under the laws of Ontario, Canada.  Pending
payment of the debt, the Lender is enforcing its rights
pursuant to the security held by the Lender in all the
issued and outstanding shares of CCGC (Ontario) and the
Lender may exercise all the rights of the company as a
shareholder of CCGC (Ontario) including the sale of the
shares of CCGC (Ontario) to a third party.  The Company
is a guarantor of the indebtedness and as such the Lender
may enforce its rights pursuant to the security held by
the Lender in the shares of CCGC (Ontario).  The Lender
may also enforce its security in the assets and
undertakings of the Company.  As a result the Company's
shares will remain suspended by the Alberta Stock

CCGC (Ontario) has diligently searched for a strategic
buyer over the past four months as contemplated under a
Proposal filed by it under the Bankruptcy and Insolvency
Act (the Proposal).  Over the period more than 150
potential prospects were contacted.  CCGC (Ontario) was
in negotiations with a prospective purchaser, however, no
legal binding purchase and sale agreement was in place
prior to the February 5, 1998 statutory deadline for
filing the Proposal.  

CCGC (Ontario) entered into an Agreement on February 5,
1996 with the Lender whereby the Lender would reasonably
co-operate with CCGC (Ontario) until August 1, 1998 to
find a buyer of all of the shares of CCGC (Ontario).  The
Lender has the right to abandon these efforts to sell the
shares and may enforce its security on the property and
assets of CCGC (Ontario).  As part of this Agreement, the
Company has transferred and absolutely assigned all
indebtedness due it to a wholly owned subsidiary of CCGC
(Ontario) which will be wound up, thereby extinguishing
such indebtedness to preserve about $1.6 million of non
capital losses.  

CCGC (Ontario) lodged its Proposal and a formal meeting
of the unsecured creditors was held to consider the
Proposal on February 25, 1998 .  The Proposal was
approved by about 95 percent of the unsecured creditors.  
An application to the Court for approval of the Proposal
is pending.  

The Lender has recently entered into an agreement with a
third party to sell either the assets and undertakings or
shares of CCGC (Ontario) subject to certain conditions.

EXCALIBUR FINANCIAL: Asks to Reject Executory Contracts
The debtors, Excalibur Financial Services LP, PBC
Servicing Corporation and Rapid Acceptance Corporation
are seeking an order approving the rejection of two
executory contracts, a tri-party custodial agreement for
contracts with PBC, CS First Boston Mortgage Capital
Corp. and Norwest Bank Minnesota, NA and a Master
Repurchase Agreement between PBC and CS First Boston.

The plan of reorganization that the debtors filed
provides for the issuance of a secured note in full
satisfaction of the claims of First Boston agianst the
debtors.  Accordingly, the plan does not contemplate
assumption of either of the agreements, and the debtors
have no intention of assuming the agreements now or in
the future.

FOXMEYER CORPORATION: Trustee Seeks Claims Team
The Trustee in the case of FoxMeyer Corporation and its
affiliated companies, as debtors, filed an application
for an order authorizing and approving retention of two
members of Trustee's Claims team.

The Trustee estimates asserting preference demands
against approximately 2,000 vendors for in excess of $200
million of net preferences in the aggregate.  The Trustee
believes that increasing the Claims Team by two
individuals will continue to be more cost-effective and
beneficial to the estates and will allow the Trustee to
retain the greatest level of control over the preference
process. the Trustee asserts that the effective handling
of the Claims Process, including the prosecution of
preferences, is critical to the success of these Chapter
7 cases.

HOSPITAL STAFFING: Selling Nursing Division
Hospital Staffing Services Inc., owner of Mid-South Home
Health in Memphis, may solve some of its financial
problems by selling part of the company. Fort Lauderdale,
Fla.-based HSS on Monday closed a deal to sell its Travel
Nurse subsidiary to Preferred Employers Holdings Inc. for
$5 million.

However, HSS still faces critical cash flow shortfalls
and is in default on its loan agreement, executives said.
Directors are considering options that include selling
the entire company or filing for protection from
creditors under Chapter 11 of U.S. Bankruptcy Code.

And HSS chairman and chief executive officer Ronald A.
Cass resigned last month after learning he is a target of
a federal investigation related to Medicare claims made
by the company's Florida home health operations. No
charges have been filed.

HHS reported a loss of $5.1 million, or 80 cents a share,
for the first nine months of its fiscal year. The loss
reflected a $4.2 million charge to increase its Medicare
reserves.  Medicare said it overpaid HSS's New England
home care unit during 1993 and 1994. The government is
recouping its loss by withholding payments to HSS for
claims submitted in 1996 and 1997.
(Commercial Appeal Memphis - 03/10/98)

INPHOMATION: NationsBank Sues Owner
NationsBank N.A. has alleged fraud in a lawsuit it has
filed seeking millions from the now-bankrupt Inphomation
Communications Inc. and its owner, Michael W. Lasky.

The Pikesville-based Inphomation Communications, better
known as operator of the Psychic Friends Network, filed
for federal bankruptcy protection Feb. 2, claiming assets
of $1.2 million and liabilities of $26 million. Last
month, citing evidence of "concealment, dishonesty and
less than full disclosure," a federal bankruptcy judge
ordered that an outside trustee be installed to
replace the company's present management.

After hearing evidence of a clandestine shell company
creditors claim was being positioned to strip Inphomation
of assets and business, the bankruptcy judge said "in
some cases, I think I've heard evidence of criminal

Documents say that in late March 1997, NationsBank and
Inphomation restructured some existing loans the company
had with the bank, including one for $157,000, another
for $66,000 and a credit line of $5 million. NationsBank
alleges that Inphomation failed to make payments on the
$5 million for September, October, November and December
1997 -- constituting a "default" on all three loans.

As of Jan. 9, Inphomation owed the bank $6.18 million
under the three agreements  The bank now seeks
$2,563,754.25 from the Laskys on a personal loan,  as
compensatory damages -- as well as interest and legal
fees -- and from Michael Lasky alone is seeking
punitive damages of $5 million. (Baltimore Sun; 03/10/98)

OMNI MULTIMEDIA: Creditors Seeking Firm's Liquidation
Unsecured creditors of Omni Multimendia Group have filed
a motion asking U.S. Bankruptcy Court Judge James F.
Queenan Jr. to liquidate the company. If the motion is
granted, the troubled Millbury maker and distributor of
CD-Roms and music CDs could be shut down today.

Omni and four subsidiary companies filed for Chapter 11
bankruptcy protection in November. At that time the
company reported assets of about $7 million and
liabilities of about $36.6 million, including more than
$2 million to the unsecured creditors. The company's
largest secured creditor, Coast Business Credit of
California is owed $4.2 million. Omni lost $15.6 million
in its last fiscal year.

In January Queenan gave Omni until Feb. 27 to use cash
collateral pledged to Coast while it found a buyer.
Queenan later extended the order to today. At the time,
Coast lawyers said the lender was willing to give Omni a
chance to find a buyer, but if Omni did not find a buyer
by today's deadline, Coast would no longer allow Omni to
finance its operations with cash collateral.

Robert E. Lee, Omni's CFO reportedly said Omni has held
discussions with at least five potential buyers or
investors over the last two months.

Meanwhile, according to the motion, officials for Omni
and Coast "have engaged in a totally unproductive,
vituperative and rancorous display of charge and
countercharge to the point of distracting the debtors
from their business, fomenting unease among customers and
creditors of the debtor alike, and perhaps contributing
to the withdrawal of interested purchasers."
(Telegram Gazette Worcester - 03/10/98)

ONEITA INDUSTRIES: Needs Time for Lease Determination
Oneita Industries, Inc. applies for an order extending
the time for the debtor to assume or reject its unexpired
leases of nonresidnetial real property.  

The debtor filed its voluntary petition for relief under
Chapter 11 of the bankruptcy code together with a plan of
reorganization and a disclosure statement relating to the

Prior to the Chapter 11 case, the debtor reached an
agreement with the revolving credit Lenders, which the
debtor seeks to implement through the plan.  Pursuant to
the plan, approximately $19.5 million of debtor under the
revolving credit agreement , the Prudential note
agreement and the subordinated note agreement will be
converted to 79.5% of the common stock of the reorganized

The debtor anticipates that the Chapter 11 case will be
relatively brief and non-contentious.  March 13, 1998 is
the date set for a hearing to consider approval of the
disclosure statement and it is also the last day for the
creditors of the debtor to file proofs of claims.  A
hearing to consider confirmation of the plan is set for
April 29, 1998.

The debtor is a lessee under 6 unexpired leases.  By this
motion, the debtor requests that the court enter an order
extending the time for the debtor to determine whether to
assume or reject the leases through the earlier of May
30, 1998 or the date that an order is entered confirming
the plan, which is expected to occur in early May 1998.

ONEITA INDUSTRIES: Taps Ordinary Course Attorneys
Oneita Industries, Inc. applies to the court for the
authority to employ ordinary course employees, including
nine separate law firms to perform general corporate
litigation, particular employee claim litigation, a firm
to handle employee benefit and retirement plans,
environmental compliance matters, intellectual property
matters and collection matters.

Each of the ordinary course professionals has rendered
services to the debtor prior to the petition date.  The
debtor requests that the court authorize it to continue
to employ the ordinary course professionals as of the
petition date, and to pay the fees and expenses as and
when they become due without prior court approval.

PARAGON TRADE: Debtor Responds to Procter & Gamble
Paragon Trade Brands, Inc. responds in opposition to the
motion for relief from the automatic stay filed by The
Procter & Gamble Company.  

Proctor & Gamble seeks to file an accounting in the
Delaware District Court, which according to the debtor,
the value of the damages should be fixed as a claim
against the debtor and filed in the bankruptcy case.  

The debtor states that the proper process is for Procter
& Gamble to file its claim in this bankruptcy case, and
work with Paragon on a cooperative basis to share
information so that a consensual resolution of the dollar
value of Procter & Gamble's claim can be agreed upon
subject to the supervision of the bankruptcy court and
the Creditors' Committee.  

Procter & Gamble also seeks an injunction in District
Court when according to Paragon it has already agreed
that it will no seek to enforce any injunctive relief
against Paragon until at least July 1998.

The debtor claims that whether the Delaware Judgment is
currently appealable is an open issue, but the debtor
states that Procter & Gamble should not be allowed to
"finalize" the judgment now by obtaining a ruling on its
request for an injunction.

PARAGON TRADE: Responds to Motion to Compel
Paragon Trade Brands, Inc., debtor, responds in
opposition to the motion to compel the debtor to assume
or reject an executory contract filed by the Proctor &
Gamble Company (P&G).

P&G seeks relief requiring Paragon to assume or reject
that certain agreement concerning Product Conversion

First, the debtor argues that the Conversion Agreement
may not be an executory contract.  If it is not, then P&G
has no basis for the requested relief.

If the Conversion Agreement is an executory contract, the
debtor argues that it may assume or reject the contract
at any time prior to confirmation of the plan.  The
debtor states that the bankruptcy court should not force
an early decision on an executory contract, that the
debtor is complying with the contract. Paragon states
that P&G has no rights under the Conversion Agreement to
require status reports on the progress Paragon is making
on designing a new product; no rights to force Paragon to
"reaffirm" its obligations under the Conversion
Agreement; and rights to force any payments due under the
Conversion Agreement any earlier than due.  Paragon
states that it is difficult to understand why P&G should
be treated better simply because Paragon has filed for
bankruptcy protection.  

PHELPS TECHNOLOGIES: Bar Date Fixed - March 31, 1998
The court in the case of Phelps Technologies, Inc., and
Phelps Tool and Die Houston, Inc., debtors, entered an
order fixing March 31, 1998 as the bar date for creditors
to file claims.

PHELPS TECHNOLOGIES: Court Approves Professionals
The court in the case of Phelps Technologies, Inc., and
Phelps Tool and Die Houston, Inc., approved applications
to hire Polsinelli, White, Vareman & Shelton as debtor's
counsel, the court also approved the retention of
Silverman Korenthal & Company as financial consultants
for the debtor.

PHELPS TECHNOLOGIES: Extension for Lease Evaluation
The court in the case of Phelps Technologies, Inc.,
ordered that the 60 day limit set forth in the bankruptcy
code in which the debtor must assume or reject an
unexpired lease of nonresidential real property under
which debtor is the lessee is extended to the date of
confirmation of any plan of reorganization in the case.

PHOENIX INFO: Equity Replies to Objections for Counsel
The Official Equity Committee in the case of Phoenix
Information Systems Corp, Phoenix Systems Ltd. and
Phoenix Systems Group, Inc. replies to the debtors'
objections to the Equity Committee's application for
authority to employ Spector Gadon & Rosen as special

The debtors responded to the application alleging that it
would be duplicative of the investigation "intended" by
LeBoeuf, Lamb, Greene & MacRae to hire the Spector firm.  
The Committee submits that neutral counsel should be
retained to investigate the allegations.  The Committee
states that the Spector firm is disinterested and capable
and should be retained to investigate these issues in the
best interest of the entire estate, as opposed to a firm
that represents the interests of a limited faction, such
as the Directors.

RELIANCE ACCEPTANCE: Committee Seeks Co-Counsel
The Official Unsecured Creditors' Committee of Reliance
Acceptance, Group, Inc. et al., applies for an order
authorizing the retention and employment of Pepper
Hamilton LLP and Hopkins & Sutter to serve as co-counsel
for the Committee.

The Committee seeks to retain Pepper Hamilton as its
counsel because of the firm's extensive experience and
knowledge in the field of creditors' rights and business
reorganizations.  Compensation will be payable to the
firm on an hourly basis, plus actually necessary
expenses. The firm is proposing a retainer in the amount
of $25,000.  

The Committee seeks to retain to retain Hopkins & Sutter
as co-counsel to the Committee due to their extensive
experience and knowledge of bankruptcy, business
reorganization and debtor/creditor matters.
The Committee seeks to retain Hopkins & Sutter with
compensation based upon the firm's normal hourly rates
together with a retainer in the sum of $50,000.

SA TELECOMMUNICATIONS: WorldCom Objects to Houlihan
WorldCom, Inc. f/k/a LDDS Communications, Inc. and
WorldCom Network Services, Inc., f/k/a WilTel, Inc.,
objects to the debtors' application for an order
authorizing the retention of Houlihan Lokey Howard &
Zukin Capital as special investment banking advisor to
the debtors.

WorldCom states that the services to be rendered by
Houlihan Lokey are duplicative of the efforts of J. Alix
& Associates.  The very services that the debtors are
seeking Houlihan to perform have already been approved to
be performed by J. Alix according to WorldCom.

WorldCom also argues that if Houlihan Lokey is approved,
they should be required to submit application for
approval of fees prior to being paid, and Houlihan Lokey
should not be paid a distribution preference at the
expense of the estates' other administrative creditors.  
Further, WorldCom states that the indemnification of
Houlihan as provided in the agreement with the debtor is
not appropriate in the bankruptcy context.

SAMSUNG MOTORS: Hopes for Deal with Ford
A South Korean automaker, backed by electronics maker
Samsung, is negotiating with U.S. giant Ford Motor Co.
about a partnership.  Samsung Motors Vice President Lee
Dae-won left Seoul for Detroit, where he will meet Ford
Vice-President Wayne Booker.

Spokesman Jay Kim said the two men will discuss possible
production of Ford vehicles in South Korea, Asia's second
largest auto market.  Kim said other proposals, which
follow a January letter of intent signed by the two
companies, include joint parts production in South Korea.

The Samsung SM520 sedan is a Nissan design built under
license from the Japanese carmaker.  A Samsung statement
Wednesday said "the company is looking forward to
bringing in foreign capital to play a large role in
overcoming the foreign currency crisis."

Samsung has invested $1.78 billion to launch its auto
subsidiary, but has put off expansion plans in the wake
of an economic crisis that devaluated the Korean won by
more than 40 percent and sent businesses to the brink of
bankruptcy.  Domestic auto sales fell more than 70
percent in January compared to the same month a year ago.
Samsung plans to build 83,000 vehicles in 1998.
(UPI: International- 03/11/98)

SMITH TECHNOLOGY: Applies to Employ Deloitte & Touche
Smith Technology Corporation, debtor, is applying for
court authority to employ Deloitte & Touche LLP as tax
refund and tax return consultants for the debtors.

The debtors have also filed an application for an order
authorizing the employment of Follman Properties - Oncor
International as realtors for the debtors.

VENTURE STORES: Seeks Time to Assume or Reject Leases
A hearing will be held March 13, 1998 on the motion of
the debtor, Venture Stores, Inc. to extend the time
within which the debtor may assume or reject unexpired
leases of non-residential real property.

The debtor operates 93 retail stores as well as 3
distribution centers and a return center on premises
which are the subject of agreements denominated as
leases.  The debtor ahs moved to reject nine "Dollar
Store" leases that are not the subject of this request.

Given the importance of the leases to the debtor's
ongoing operations it would be impossible and imprudent,
according to the debtor, to make decisions on the
assumption or rejection of leases at this point in time.  
Since the petition date, the debtor has been attempting
to stabilize its business and handle the vast number of
critical administrative and business decisions required
to adjust to operating in Chapter 11.  Also, twenty of
the debtor's stores have been closed, and the debtor has
spent considerable time in that effort.

Due to the complexity of the case, the size of the case,
and the matters that have occupied the debtor, the debtor
is requesting an extension of the period during which the
debtor must assume and assign or reject unexpired leases
of non-residential real property through and including
September 21, 1998.

WELCOME HOME: Seeks Extension of Exclusivity
The debtor, Welcome Home Inc. a/k/a the Glorious Nest,
home Again, f/k/a Cape Craftsmen, Inc., is seeking
addition time to formulate a plan of reorganization.  the
debtor believes that if granted an additional 60 days to
file a plan and an additional 60 days thereafter in which
to obtain acceptance of such plan, an acceptable plan
will be filed and the debtor will secure the requisite
number and amount of acceptances.

The debtor requests entry of an order extending to and
including May 18, 1998 the time in which the debtor
retains the exclusive right to file a plan, and extending
to and including July 14, 1998, the time in which the
debtor has to obtain acceptance of its plan.


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