TCR_Public/990115.MBX T R O U B L E D   C O M P A N Y   R E P O R T E R
     
  Friday, January 15, 1999, Vol. 3, No. 10

                 Headlines

ABL: Phoenix Tops List of ABL Creditors
AMERICAN RICE: Seeks Nod For Sixth DIP Amendment
BROTHERS GOURMET: Seeks Approval of Bidding Procedures
CALDOR CORP: Close To Liquidation - Sells Leases
HAYES CORP: Panel Will Seek Chapter 11 Trustee - Under Seal

LEVITZ FURNITURE: Seeks To Enter Into Agency Agreement
LIBERTY HOUSE: Stipulation Regarding Consulting Agreement
LIVENT INC: Former Officers Indicted
LIVENT INC: Statement of Garth Drabinsky
LYNX GOLF: Seeks Time To Assume/Reject Leases

MCCULLOCH: Strategic Distribution Comments On Bankruptcy
NEWTWAVE: Seeks To Pay Search Firm $300,000 To Find New CEO
PETSEC ENERGY: To Raise $68.5M With Sale of Interests
RINCON ISLAND: Committee Taps Oil and Gas Advisor
RINCON ISLAND: Committee Taps Baker & McKenzie

SCOOP INC: Debtor Taps Latham & Watkins
SOUTHMARK CORP: Fee Disgorgement Bars Malpractice Suit
THE SCORE BOARD: Hearing on Disclosure statement Set
UNISON HEALTHCARE: Opposition to Filkoski's Objection
VENTURE: Notice of Effective Date
VOICE IT: Court Denies Employ of Special Counsel

DLS CAPITAL: Bond Pricing For Week of January 11

                 *********

ABL: Phoenix Tops List of ABL Creditors
---------------------------------------
Phoenix Home Life Mutual Insurance Co., perhaps the
American Basketball League's biggest corporate fan, is now
its biggest creditor, on the hook for a $6 million bank
loan it may never recover.

Hartford-based Phoenix, which guaranteed payment of a loan
from Fleet Bank, is taking by far the biggest hit among
more than 1,000 creditors who will lose money as a result
of the ABL's bankruptcy.

But a day after state Attorney General Richard Blumenthal
announced an investigation into possible antitrust
violations by the rival WNBA women's basketball league, a
bankruptcy lawyer for the ABL said the league plans
its  own antitrust lawsuit, a move that might provide more
money for season-ticket holders and others hurt by the
league's demise.

The lawyer, Michael B. Lubic of Los Angeles, said he could
offer no details of the league's legal plans and would not
even identify the defendant, although it is almost
certainly the NBA and WNBA.

But Lubic did confirm that when the ABL files a detailed
list of assets with the bankruptcy court, the league
intends to list the proceeds of an as-yet unfiled antitrust
lawsuit as a potential source of money -- money that
would go  directly to the league's creditors.

In the company's New Year's Eve filing, the ABL claimed
assets of less than $500,000 and debts of more than $10
million. Players and some season-ticket holders will be at
the top of the list when the league's assets are
liquidated.  But with $2.8 million owed to ticket holders
and an additional $750,000 in unpaid wages, even those
"priority" creditors may see only pennies on the
dollar.

Unsecured creditors -- a long list of businesses from Fleet
to CBS Sports to  Reebok -- may see nothing at all.

The ABL's second-largest creditor is Larry Hunt, a Georgia
man who was partners in business -- and crime -- with ABL
co-founder Bobby Johnson. Hunt and Johnson pleaded guilty
last month to federal charges that they plotted a  
$9.5 million Medicaid fraud scheme.

Hunt owned stock in the ABL and, after a dispute, the
league agreed to buy back the stock, although Hunt had not
collected all the money by the time the league went under.
His debt with the ABL is listed at  $1.9 million, but it's
unlikely Hunt will collect anything. As part of his plea
agreement, Hunt was sentenced to three years in prison and
agreed to forfeit all of his assets. In fact, the  
U.S. Marshals Service in Altanta, which seized Hunt's
assets, is also listed as a creditor.

There are more than 1,000 other creditors, including
advertising and media companies, sporting-goods
manufacturers, players, ticket holders and
game  arenas. Only nine are owed $100,000 or more.

The city and county of Denver are out more than $43,000 for
the eight games already played by the league,  and that
doesn't take into account money lost on games that weren't
played, said Bobbi McFarland, business manager for the  
county's theaters and arenas.

The 20 biggest unsecured creditors listed by the American
Basketball League  Inc. in its bankruptcy filing:

Fleet Bank   $6.08 million   Loan guaranteed by
Hartford    Phoenix Home Mutual

Larry Hunt    $1.9 million   Stock repurchased by ABL
Lithonia, Ga.

Nat'l Sports Partnership $320,000.00   Television
Los Angeles

Fox Sports Bay Area   $281,000.00 Television
Woodbury, N.Y.

Near North Ins. Brokerage $279,379.00        Insurance
Chicago

U.S. Marshals Service    $270,000.00   Seized assets of
Larry Hunt Atlanta (portion of repurchased stock)

Gish, Sheerwood & Friends  $222,737.88  Advertising
Nashville

Cavalli & Cribbs  $200,277.56  Advertising
Palo Alto, Calif.

CBS Sports   $100,000.00   Media exposure
New York

Gear For Sports   $97,164.97    Apparel
Chicago

ANC Sports Enterprises   $88,850.00   Signs
Purchase, N.Y.

Baden & Co.  $83,324.75   Advertising
King of Prussia, Pa.

PMTV   $79,903.00     TV production
King of Prussia, Pa.

Stuart Leeb  $67,309.00  Landlord
Palo Alto, Calif.

Venture Law Group   $66,601    Legal services
Menlo Park, Calif.

Emerald City Media Services   $52,843.17   TV production
New York

Associated Travel  $49,264. Travel agent
Ontario, Calif.

Jarrad-Ingram    $45,249.99  Public relations
Nashville

Reebok  $43,712.85     Equipment
Atlanta

City & County of Denver $43,176.58  Landlord
Denver, Colo.
(Copyright@ The Hartford Courant 13-Jan-99)


AMERICAN RICE: Seeks Nod For Sixth DIP Amendment
------------------------------------------------
American Rice Inc. is seeking an emergency order approving
the sixth amendment to its debtor-in-possession financing
agreement.  The DIP financing is necessary to prevent the
rice processor's business from grinding to a halt.
"Specifically, Debtor would be forced to terminate business
operations immediately if it could not continue to use cash
collateral, and borrow additional funds from the Working
Capital Lenders," according to the Jan. 4 memorandum.
Noting that the agreement's fifth amendment expired on Dec.
31, American Rice anticipated that, by Jan. 4, its working
capital lenders would agree to continue to provide
financing through May 31, at the latest, in accordance with
a budget. American Rice received interim approval on Sept.
11 to borrow up to $8 million over four months from its
bank group, led by First Union National Bank (FTU).  At
that point, the company had been seeking a facility with
less availability than its original $85 million DIP
agreement.(The Daily Bankruptcy Review and ABI Copyright c
January 14, 1999)


BROTHERS GOURMET: Seeks Approval of Bidding Procedures
------------------------------------------------------
The debtors, Brothers Gourmet Coffees, Inc., et al, seek an
order approving proposed bidding procedures with respect to
the sale of the debtors' business and approving certain
terms of stock purchase agreement.

Brothers executed a Stock Purchase Agreement with BGC
Acquisition Corp. pursuant tot he contract the Proposed
Buyer has agreed to purchase 1-00% of the equity of
Brothers, a s reorganize under a plan of reorganization,
for consideration consisting of approximately $20.75
million in cash and the assumption of certain specified
obligations.  PricewaterhouseCoopers LLP has valued the
total consideration under the contract at approximately
$23.81 million.  In agreeing to permit its proposal to be
subject to the receipt of higher and better offers, the
Proposed Buyer has conditioned its offer on Brothers being
authorized to pay the Proposed Buyer a due diligence fee of
$100,000 to defray the Proposed Buyer's reasonable expenses
incurred in connection with its efforts to purchase the
debtor's business, which fee would be deposited into escrow
upon entry of an order granting this motion.  Brothers also
agrees to pay the proposed buyer a break up fee of $450,000
under certain specified circumstances.

The auction is set for March 3, 1999 among bidders having
submitted a qualified bid.  The deadline to submit an offer
to purchase the debtor's business is 5:00 PM EST on
February 22, 1999.  Higher bids must increase the proposed
sale transaction by at least $750,000.


CALDOR: Close To Liquidation - Sells Leases
-------------------------------------------
Reportedly Close to Liquidation Caldor Corp. has sold 62 of
its store leases to three major discount chains, according
to the Bergen Record, and it is rumored that the discount
retailer may begin liquidating as early as next week. Last
week the company stopped paying suppliers, and lenders have
been applying pressure for Caldor to cease business and
liquidate. Caldor, which has been under chapter 11
protection since 1995 and was to emerge from bankruptcy
this spring, has been losing money continuously. Creditors
of the Norwalk, Conn., chain have pushed the company to
liquidate to stem their losses. According to an unnamed
source, Caldor sold 34 prime leases to Kohl's Corp., 18 to
Kmart and 12 to Target. Caldor has not discussed its plans
or the reported sales of the leases and said only that
negotiations are confidential. (ABI 14-Jan-99)


HAYES CORP: Panel Will Seek Chapter 11 Trustee - Under Seal
-----------------------------------------------------------
Hayes Corp.'s official committee of unsecured creditors is
seeking permission to file under seal its emergency motion
requesting the appointment of a Chapter 11 Trustee or, in
the alternative, the conversion of the cases to Chapter 7.  
Remarking that "the Debtor's efforts at reorganization have
failed," the panel said it has lost confidence in the
ability of Hayes' board to manage the announced
liquidation.  Moreover, the filing notes that the only
parties with a continuous stake in the outcome of the case
are debtor-in-possession lender NationsCredit Commercial
Corp. and prepetition unsecured and other creditors.  The
filing requests that only the court, Hayes, NationsCredit,
and the U.S. Trustee have access to the emergency motion.
(Federal Filings Inc. 14-Jan-99)


LEVITZ FURNITURE: Seeks To Enter Into Agency Agreement
------------------------------------------------------
The debtor, Levitz Furniture incorporated, et al., seeks an
order authorizing the debtors to enter into an agreement
with a joint venture among Hilco Trading Co., Inc., Garcel,
Inc. d/b/a great American Asset Management, the Nassi
Group, LLC and Gene Rosenberg Associates to act as the
debtors' agent for conducting certain store closing sales
at 27 stores on the terms and conditions set forth in the
Agency Agreement.

The store closing sales shall commence no later than
February 1, 1999 and shall run until April 30, 1999, unless
otherwise consented to by the merchant.  The agent has
agreed to pay the debtors the sum of 80% of the aggregate
cost value of the merchandise and for first quality
optional sets and first quality stand alone pieces of
additional Levitz inventory and shall be 50% of cost value
for less than optimal items.  In addition to the Guaranteed
Amount, the agent agrees to pay 1% of the proceeds received
form the sale of the augmented inventory.  The agreement is
subject to higher and better offers, and a termination fee
of l$270,000 is provided.


LIBERTY HOUSE: Stipulation Regarding Consulting Agreement
---------------------------------------------------------
Liberty House, Inc., debtor and the Official Committee of
Usnecured Creditors enter into a Stipulation with reference
to a consulting agreement with Kurt Salmon
Associates.("KSA")

KSA will assist the debtor by developing and managing the
debtor's master project plan.  Once implemented the plan
will be used to manage all of the information technology
projects that are currently active or scheduled for
implementation at Liberty House.  Specifically, the plan
will monitor, track and report the status of all
information technology projects as they relate to Year 2000
compliance. KSA will develop the plan system procedures and
guidelines; implement an "issues tracking" database program
on the Liberty House network for plan project leaders in
order to track all project issues; implement a "bug
tracking" database program; report plan finding through a
weekly summary report; compile budgets, forecasts and cash
flow data; and compile weekly project status reports.  KSA
will also educate and train Liberty House personnel to use
the plan system.  The fee to be paid to KSA under the
agreement is estimated not to exceed $69,560.


LIVENT INC: Former Officers Indicted
------------------------------------
Two former top officers of the troubled theatrical group
Livent Inc., were indicted Wednesday for masterminding a
scheme to inflate the company's financial records and
defraud investors.

The indictment filed in U.S. federal court* in Manhattan  
names Garth Drabinsky, 48, Livent's former chairman, and
Myron Gottlieb, 55, former president. The two were also
named in a related civil suit filed by the Securities and
Exchange Commission.

Toronto-based Livent, whose Broadway productions have won  
18 Tony awards, including Best Musical for "Kiss of the
Spider Woman," filed for Chapter 11  bankruptcy protection
on Nov. 18, 1998. The filing came four months after
it  restated more than two years of financial results due
to accounting irregularities.

The company restated the results dating back to 1996 to
reflect a reduction in net income of C$85.1 million over
that period. The Nov. 18 restatement included a C$45.8
million loss in the theater company's second quarter.

Livent suspended Drabinsky and Gottlieb on Aug. 10. Its
stock was suspended in Toronto and New York the same day
and now trades on Canada's over-the-counter market.

According to the U.S. Attorney's office in Manhattan, two
other former officers, Maria Messina, chief financial
officer, and Gordon Eckstein, senior vice president of
finance and administration, have pleaded guilty in the  
criminal case.

Authorities alleged the defendants were involved in an
eight-year fraudulent accounting scheme orchestrated by
Drabinsky and Gottlieb.

Former senior management of Livent allegedly inflated
earnings, revenues and fixed assets reported by the company
in financial statements filed with the SEC and disseminated
publicly since 1995, according to the charges.

As a result of the filings, Livent overstated results of
its operations and financial conditions. The scheme
allegedly affected at least 17 filings made by Livent
during its first three fiscal years as a publicly traded
company in the United States starting in 1995 and continued
through the first quarter of fiscal 1998.     "At the end
of each fiscal quarter, Drabinsky, Gottlieb and
others directed the accounting staff to simply erase from
Livent's general ledger millions of dollars of direct
operating expenses and general and administrative expenses
that had been incurred and recorded by Livent's  
controllers," the indictment charges.

>From 1990 through 1994, even before Livent became a U.S.
public company, Drabinsky and Gottlieb allegedly engaged in
a kickback conspiracy to siphon off about $C7 million for
themselves through inflated invoices paid to vendors.

Drabinsky and Gottlieb allegedly directed Eckstein to
capitalize the majority of this amount into preproduction
cost accounts.

As a result Livent overstated pre-tax earnings in its
fiscal years 1991 and 1992 financial statements that were
included in the company's registration statement in May
1995 to register 12 million shares of common stock in the  
United States. That registration statement also overstated
the company's preproduction costs in fiscal 1994 by $C4
million.

Authorities also alleged that, beginning in 1994, Drabinsky
and Gottlieb directed elaborate manipulations of  books,
record and accounts. These manipulations were allegedly
designed to understate expenses in order to inflate
earnings, portray unsuccessful theatrical products as
profitable and to meet quarterly and annual projections
provided to Wall Street analysts.

One manipulation, for example, involved the improper
shifting between accounting periods of show preproduction  
costs, like advertising, to fixed assets, such as the
construction of theaters in Chicago and New York.      
($1=$1.53 Canadian) (Reuters:Financial-01/13/99)


LIVENT INC: Statement of Garth Drabinsky
----------------------------------------
STATEMENT FROM GARTH H. DRABINSKY AT TORONTO PRESS
CONFERENCE:

Thank you ladies and gentlemen for attending. Let me assure
you at the outset that the charges brought against me today
in the U.S. are baseless. I would never have knowingly
permitted the release of false financial statements about
Livent. I can say that I never instructed Livent's
accounting staff to engage in illegal or improper
accounting practices, nor did I know of any illegal or
improper accounting practices.

So how did we get to this point - a criminal indictment and
the bankruptcy protection of the company? This is the
legacy of the company's new management. On August 10th,
1998, new management issued a press release advising that
it had uncovered accounting irregularities in the books and
records of Livent. For reasons still unknown to me they
announced, in a highly public fashion, that Mr. Gottlieb
and myself were suspended - a decision made prior to any
independent investigation of the allegations.

Clearly, and for reasons best known to them, new management
wanted me out. This precipitous and deliberate action has
caused incalculable pain to me and was deliberately
designed to damage my reputation and to inflict a heavy
toll on my personal resources. It also set in motion the
calamitous events that were to follow both individually and
corporately. Rather than run the company, new management
has focussed a preponderance of its attention on bringing a
civil law suit against Mr. Gottlieb and me, and on
motivating American and Canadian authorities to take quick,
ill-conceived action against us. In the process they have
abandoned the company's shareholders, squandered the
company's franchise and caused the company to seek
bankruptcy protection. In due course, the truth will
emerge.

Typical of the reckless allegations launched at us by new
management, is Livent's Statement of Claim filed against
Myron and me. That Statement contained, by way of glaring
example, an insidious allegation that Mr. Gottlieb
and I were net sellers of Livent shares, suggesting that
we were jumping ship because we had inside information that
Livent might be in financial trouble. Nothing could be
further from the truth. In fact, in the twelve month period
culminating in the April 13, 1998 Investment Agreement with
Mr. Ovitz, Mr. Gottlieb and I had invested an additional
$3.5 million in the company; we have sold no shares since a
reported private transaction in February 1995.

When Mr. Gottlieb and I selected the Ovitz/Furman
investment for Livent, we were not compelled to do so. At
that time, there were a number of other viable corporate or
financing alternatives. However, we accepted the compelling
representations of our then investment banker, Roy Furman,
who argued that this transaction would best enable Livent
to grow and maximize value to shareholders.

We clearly appreciated that prior to any such investment,
the books and records of Livent would and should be closely
scrutinized and its management and accounting staff would
be, and were, closely questioned in a rigorous ``due  
diligence'' process by KPMG, Ovitz and Furman. Ours were
not the actions of men trying to hide alleged illegal
accounting practices. We knew of no alleged  
illegal accounting practices.

I am, first and foremost, a theatrical producer. My
personal role at Livent was heavily focussed on the
creative aspect of the company. Without hit shows,  
Livent could not exist. The simple reality is that managing
and developing as many as 15 to 20 contemporaneous
productions, overseeing the worldwide marketing of those
productions and developing new theatre venues left me
little time for anything else.

While this is a personal tragedy, the implications of this
concerted and false personal attack go well beyond one
individual. As I have said, Livent has been placed in
bankruptcy protection. Its share price has been devastated.
Its remaining employees, particularly in Canada, are left
in a state of uncertainty. The toll on the artistic
community of Canada and its impact on tourism and related
economic activity in Toronto and Vancouver has yet to be
measured.

It is important for you to know that, although I was not
obliged by law to do so, I have co-operated with the U.S.
Department of Justice. I voluntarily travelled to the
United States to be interviewed. There was no question
which the prosecutor asked that I did not answer fully and
directly. Unfortunately, it was clear that the decision to
file charges against me was set in stone in advance of that
meeting.

The RCMP, who are conducting a separate investigation, have
publicly stated that their investigation may take some
considerable time. Obviously, I am distressed that the U.S.
Department of Justice has felt the need to make such a
hasty decision to file charges after only a few months.

It has always been my intention to have the facts
surrounding these allegations fully explored by the civil
Courts in Canada and this U.S. indictment changes  
nothing. I will press ahead with the civil case.

I would like to remind members of the public, and
particularly those who have been kind enough to express
their continuing support for me amidst a sea of  
troubles, that it is the function of the Courts to
distinguish between mere accusations and the truth. This is
undoubtedly a difficult moment for me. The financial
resources of the U.S. government are arrayed against me.
However, I shall fight on until the truth has been
established and my reputation has been restored. I am
innocent and have committed no criminal wrongdoing. The
final act of this tragedy has yet to be played out and,
when it is, Myron Gottlieb and I have complete confidence
that we will be vindicated.  


LYNX GOLF: Seeks Time To Assume/Reject Leases
---------------------------------------------
LGI Liquidating Corp., f/k/a Lynx Golf, Inc. seeks an
extension of the time period by which LGI must assume or
reject unexpired leases of nonresidential real property,
including the lease of its headquarters through June 1,
1999.  

LGI's recently appointed president, P.A. Novelly and the
Official Committee of Unsecured Creditors are currently
negotiating the terms of a plan of reorganization for LGI,
which may involve the assumption of the lease of its
headquarters located in Carlsbad, California.  LGI requires
a reasonable opportunity to investigate the potential value
of the lease to the estate as a component of its
reorganization.  LGI is current on its postpetition
obligations.  A hearing on the motion is scheduled on
January 19, 1999 at 2:00 PM before Judge Peter W. Bowie,
U.S. Bankruptcy Court, Southern District of California.  
This relief is necessary in order to allow LGI to complete
the auction on January 20, if the auction proceeds, and to
wrap-up related activities on site.

On October 21, 1998, the court entered an order approving
the sale of substantially all of LGI's operating assets to
Folfsmith International, Inc.  LGI was authorized to employ
McCormack Auction Company as its auctioneer to conduct an
auction at LGI's headquarters.  The debtor's disclosure
statement hearing is set for January 19, 1999 and LGI's
motion to extend the exclusivity period is also set for
that date.


MCCULLOCH: Strategic Distribution Comments On Bankruptcy
--------------------------------------------------------     
Strategic Distribution, Inc. (Nasdaq/NM: STRD) reported
today that it incurred an estimated pre-tax loss of up to
$1.1 million in connection with the bankruptcy of McCulloch  
Corporation.  McCulloch, an international manufacturer of
gasoline-powered and electric portable outdoor equipment,
filed a voluntary petition for relief under chapter 11 of
the United States Bankruptcy Code.

The bankruptcy proceeding was announced on January 12,
1999, and therefore it is not yet possible for the Company
to predict the recovery on amounts owed to it by McCulloch.
Unpaid invoices as well as the value of inventory
specially  held and for which McCulloch is obligated to
pay, total approximately $1.1  million. Therefore, the
Company views this as the maximum loss that it may incur in
connection with McCulloch. The Company will recognize some
or all of the estimated pre-tax losses related to the
bankruptcy in its financial  statements for the fourth
quarter of 1998.

Strategic Distribution, Inc. is a provider of industrial
supply services to commercial and industrial customers. The
Company provides proprietary services that reduce costs and
inefficiencies in the procurement and management of
maintenance, repair and operating ("MRO") materials. For  
large industrial facilities, the Company's In-Plant
Store(tm) program offers a comprehensive MRO outsourcing
solution through which the company manages all aspects of
industrial supply and logistics. The Company also offers
proprietary MRO cataloguing services developed by INTERMAT?
to a wide range of industrial clients, including customers
of the In-Plant Store program.


NEWTWAVE: Seeks To Pay Search Firm $300,000 To Find New CEO
-----------------------------------------------------------
NextWave Telecom Inc. is requesting court approval to pay
an executive search firm up to $300,000 to locate a new
president and chief executive for the company.  "To
optimize both speed and success in attracting such a
candidate, the Debtors believe that the expertise and
resources of an international executive search firm,
specializing in filling such challenging high-level
positions, are required," asserts the Jan. 8 motion. The
CEO likely will assume responsibility for attracting
additional financial resources, leading negotiations with
strategic partners and seeking to create corporate
alliances. (Federal Filings Inc. 14-Jan-99)


PETSEC ENERGY: To Raise $68.5M With Sale of Interests
-----------------------------------------------------
On December 22, 1998, Petsec Energy Ltd issued a press
release announcing the execution of a letter agreement by
its wholly owned subsidiary, Petsec Energy Inc. ("PEI"),
with Apache Corporation whereby PEI agreed to sell
50% of its working interests in certain oil and gas
properties in the Gulf of Mexico for US$68.5 million in
cash to Apache. The transaction is subject to due
diligence and the execution by the parties of definitive
agreements. The effective date is January 1, 1999 with
closing anticipated on or before February 1, 1999 at which
time Apache will assume operatorship of the leases.

Press Release dated December 22, 1998 of Petsec Energy Ltd
with respect to letter agreement between Petsec Energy Inc.
and Apache Corporation:

22 December 1998

PETSEC ENERGY TO RAISE US$68.5 MILLION WITH CASH SALE OF
CERTAIN U.S.A. OIL AND GAS INTERESTS

Sydney, Australia - Petsec Energy Ltd (ASX: PSA and NYSE:
PSJ), today announced that its wholly owned subsidiary,
Petsec Energy Inc. had signed a letter agreement with
Apache Corporation to sell 50% of its working interest in
certain oil and gas properties in the Gulf of Mexico for
US$68.5 million (A$110 million) in cash.

Upon completion of the transaction, Petsec will hold a 100%
working interest in 21 leases in addition to a 50% working
interest in 23 joint venture leases. All of these leases
are situated in the shallow waters of the Gulf of Mexico.

The company intends to use the proceeds from the sale to
repay a significant proportion of its senior bank debt, for
capital expenditures and to provide working capital.

Petsec Energy Ltd Managing Director Terry Fern said, "The
joint venture with Apache broadens our scope. Jointly we
will explore and develop the remaining reserve potential on
those leases, while our management and technical team will
direct their efforts towards the exploration and
development of the company's remaining 100% owned portfolio
of exploration properties. The company is preparing for the
upcoming Federal Lease Sale in March 1999 as well as
seeking additional opportunities through joint ventures
with similarly focused Gulf of Mexico operators."

"This transaction represents the end of our review of
strategic alternatives.  Reducing bank debt in this period
of depressed commodity prices will enable us to
significantly improve the financial strength and
flexibility of the company.  Significant reductions in
general and administrative expense will also be
achieved. The company's profile will be different from that
when it entered the strategic process, in answer to the
changing dynamics of the industry. I'm confident our
management and technical team will grow Petsec in this
difficult market", Mr. Fern said.

The company is selling 50% of its working interest in
producing leases at Main Pass 6, 7, 84, 91 and 104, Grand
Isle 45, South Marsh Island 7, Ship Shoal 193, 194 and West
Cameron 237, 543 and 544. Petsec is also selling 50% of its
working interest in non-producing leases at Main Pass 90,
91E, 93 and 105, Ship Shoal 192 and West Cameron 542 and
653. The company currently owns a 100% working interest in
all of the above mentioned leases.

The transaction is subject to due diligence in regard to
title, environmental and mechanical condition of the
surface facilities and also to the execution by the parties
of a mutually acceptable purchase and sale agreement and
joint operating agreement. The effective date is January 1,
1999 with closing anticipated on or before February 1, 1999
at which time Apache will assume operatorship of the
leases.


RINCON ISLAND: Committee Taps Oil and Gas Advisor
-------------------------------------------------
The Official Committee of Unsecured Creditors of the
debtor, Rincon Island Limited Partnership applies to retain
and employ Randall & Dewey, Inc. as oil and gas advisor for
the Committee.  The Committee desires to retain Randall &
Dewey to assist in analyzing and evaluating the market
values for the oil and gas mineral interests and related
properties owned by Rincon Island Limited Partnership and
Windsor Energy US Corporation.  


RINCON ISLAND: Committee Taps Baker & McKenzie
----------------------------------------------
The Committee of Unsecured Creditors are seeking an order
authorizing the Committee to employ Baker & McKenzie as
General Counsel.  The Committee believest that the services
of Baker & McKenzie are equired to enable the Committee to
be adequately advised and to fully perform its duties under
the Bankruptcy Code in representing the interests of all
unsecured creditors.


SCOOP INC: Debtor Taps Latham & Watkins
---------------------------------------
The debtor, Scoop Inc. f/k/a Karlsson-Del Rey
Communications, Inc. and NewsMakers Information Services
Inc. filed a notice that it will file its application for
authority to employ Latham & Watkins as Special Corporate
Counsel.

The firm will render the following types of professional
services:

a) To advise and represent the debtor in connection with a
proposed transaction in which the debtor will be combined
with another entity;

b)To advise and represent the debtor in all matters related
to compliance with federal and state securities laws; and

c)To take such other action and perform such other services
as the debtor may require of the firm in connection with
the proposed transaction.  

The debtor requests that the court approve the employment
of the firm effective as of November 6, 1998.  The firm has
accrued fees and expenses in the aggregate amount of
approximately $5,146 since that date.  The firm did not
receive a prepetition retainer.  The firm does hold a
prepetition claim against the debtor's estate in the amount
of $208,523.


SOUTHMARK CORP: Fee Disgorgement Bars Malpractice Suit
------------------------------------------------------
The U.S. Court of Appeals for the Fifth Circuit has found
that claims for professional misconduct are bankruptcy
court core proceedings. In the case, Southmark Corp. v.
Coopers & Lybrand, the Appellate Court also ruled that
prior bankruptcy court-ordered professional fee
disgorgements preclude malpractice lawsuits that are based
on infractions that caused the fee disgorgement.  The
dispute began after Southmark hired Coopers & Lybrand to
investigate and analyze potential litigation against third
parties, including Coopers & Lybrand client Drexel Burnham
Lambert Inc.  Coopers, which went on to form financial
advisory giant PricewaterhouseCoopers LLP, told the court
at the time of its retention that "it did some accounting
work for Drexel," but failed to disclose its "substantial
auditing" duties for the underwriter.  Coopers & Lybrand
subsequently advised Southmark -- wrongly -- that it had no
causes of action against Drexel, according to Southmark.
(Federal Filings Inc. 14-Jan-99)


THE SCORE BOARD: Hearing on Disclosure statement Set
----------------------------------------------------
A Disclosure statement and plan were filed by The Score
Board, Inc. and The Score Board Holding Corp. on December
31, 1998.  The court shall conduct a hearing as to the
adequacy of such statement before Honorable Gloria M. Burns
on February 10, 1999, 10:00 AM, 3rd Floor Courtroom, U.S.
Courthouse 15 N. 7th St., Camden, NJ.


UNISON HEALTHCARE: Opposition to Filkoski's Objection
-----------------------------------------------------
On December 24, 1998, the court approved the settlement of
a number of class actions presently pending against Unison
Healthcare Corporation and its former officers and
directors, including Jerry M. Walker, former president of
Unison.

the claims asserted by the plaintiffs in the class actions
approximated $38 million , but are being settled for a
total of $4.25 million, plus $1 million in pre-bankruptcy
shares of Unison common stock.  The only objection to the
settlement came from John Filkoski, who has filed a
separate lawsuit in Colorado against Unison and its former
officers and directors.  Filkoski and members of his family
have alleged that their damages total approximately $3
million.  After considering Filkoski's arguments, the court
overruled his objection.

The proposed settlement is being funded by AESIC Insurance
Company, which issued a D&O policy in the amount o f$5
million to Unison and its former officers and directors.

Filkoski argues that if the proceeds of the AESIC policy
are used to settle the class claims, and if he opts out of
the class, there may not be any additional insurance
coverage available to pay the claims asserted by him and
his family in the Colorado litigation.  Filkoski claims
that Unison's attorneys falsely represented to the court
that there was another layer of coverage available that
would pay the Filkoskis' claim.  

Jerry M. Walker, in this memorandum in opposition to
Filkoski's motion to reconsider states that the Filkoski
family's share of the approved settlement is approximately
$200,000. Walker states that at most, Filkoskis can recover
only their pro rata share of the settlement proceeds.  If
the court affirms its prior order, entering the settlement,
the Filkoskis will have to either accept their pro rata
share or opt out of the class and take their chances in
separate litigation.  The chance that they take is that
other insurance proceeds will be available to cover their
claims if they are successful in their assertion of them.  
Walker states that it is in the best interests of the
debtor and its former officers and directors that the court
affirm its previous order approving the settlement.  The
settlement will eliminate a huge potential liability that
could consume other assets of the bankruptcy estates.


VENTURE: Notice of Effective Date
---------------------------------
The Venture Stores, Inc. modified first amended plan of
liquidation under Chapter 11 of the Bankruptcy Code
confirmed by order of the U.S. District Court for the
District of Delaware on November 23, 1998 has become
effective on December 29, 1998.


VOICE IT: Court Denies Employ of Special Counsel
------------------------------------------------
On January 4, 1999, Honorable Roland J. Brumbaugh, U.S.
Bankruptcy Judge entered an order in the case of Voice It
Worldwide, Inc. denying the application for authority to
employ Special Counsel.


DLS CAPITAL: Bond Pricing For Week of January 11
------------------------------------------------
Following are indicated prices for selected issues:

Acme Metal 10 7/8 '07          11 - 13 (f)
Amer Pad & Paper 13 '05        58 - 60
Amresco 9 7/8 '05              82 - 84
Atel 0/14 1/2 '04              13 - 16
Asia Pulp & Paper 11 3/4 '05   62 - 64
Boston Chicken 7 3/4 '05        4 - 5 (f)
Brazos 10 1/2 '07               7 - 10 (f)
Brunos 10 1/2 '05              11 - 14 (f)
Cityscape 12 3/4 '04           12 - 14 (f)
E & S Holdings 10 3/8 '06      43 - 46
Globalstar 11 1/4 '04          77 - 79
Geneva Steel 11 1/2 '01        17 - 20 (f)
Goss Graphic 12 '06            65 - 68
Hechinger 9.45 '12             68 - 72
Hills 12 1/2 '02               93 - 95
Mobilemedia 9 3/8 '07          11 - 13 (f)
Penn Traffic 8 5/8 '03         46 - 49
Planet Hollywood 12 '05        35 - 39
Royal Oak 12 3/4 '06           40 - 45 (f)
Samsonite 10 3/4 '08           83 - 88
Service Merchandise 9 '04      34 - 36 (f)
Sunbeam 0 '18                  12 - 13
Trism 10 3/4 '00               49 - 53
Trump Castle 11 3/4 '05        79 - 81
Zenith 6 1/4 '11               16 - 18 (f)

                 *********

S U B S C R I P T I O N   I N F O R M A T I O N     

Troubled Company Reporter is a daily newsletter, co-
published by Bankruptcy Creditors' Service, Inc.,
Princeton, NJ, and Beard Group, Inc., Washington, DC.  
Debra Brennan and Lexy Mueller, Editors. Copyright 1998.  
All rights reserved.  ISSN 1520-9474.  

This material is copyrighted and any commercial use, resale
or publication in any form (including e-mail forwarding,
electronic re-mailing and photocopying) is strictly
prohibited without prior written permission of the
publishers.   

Information contained herein is obtained from sources
believed to be reliable, but is not guaranteed.   
  
The TCR subscription rate is $575 for six months delivered
via e-mail. Additional e-mail subscriptions for members of
the same firm for the term of the initial subscription or
balance thereof are $25 each.  For subscription
information, contact Christopher Beard at 301/951-6400.  
       
          * * *  End of Transmission  * * *