Sen. Christopher Dodd, a presidential candidate and chairman of the Senate Banking Committee, said: "Most often, individuals are forced into bankruptcy by a devastating medical event or the loss of a job."

The Connecticut Democrat said his bill would allow judges to consider the individual circumstances of debtors in bankruptcy cases so that families and children are protected.

The bill would ensure that medical debts can always be discharged in bankruptcy and that mortgages can be restructured to help borrowers stay in their homes, he said.

Student loans would also be dischargeable under the bill, and child support and alimony payments would be settled first.

"Our bankruptcy laws should not punish these vulnerable members of our society, but instead should help them get back on their feet while protecting them and their families from added suffering at the hands of creditors," Dodd said.

The bill would seek to undo some aspects of bankruptcy reform passed in 2005, which Dodd said he opposed at the time.

Some of Dodd's Senate colleagues and lawmakers in the House of Representatives have sponsored their own versions of bankruptcy reform, but no single bill has won widespread support.

Last month, the House Judiciary Committee debated but could not pass a far-reaching measure that would let bankruptcy judges erase mortgage debt.

The Troy, Mich.-based company, which is still struggling with credit market fallout, said it wants to push back its Nov. 8 hearing to later this month. Delphi said it needs to talk with its committees and consider amendments to its investment agreement, which is key to helping the company exit bankruptcy.

Delphi has asked the U.S. Bankruptcy Court in Manhattan to delay the hearing. The court will consider the request on Thursday.

The company has been trying to re-solidify its financing since trouble among sub-prime housing lenders sparked tightening in the credit markets. Delphi said Monday it still plans to exit bankruptcy in the first quarter, despite the hearing delay.

Delphi didn't provide specifics about the objections. However, Wilmington Trust Co., one of Delphi's creditors, recently said in a court filing that the new plan "lacks adequate information regarding a number a number of issues that are critical to make intelligent and informed decisions." Wilmington said the new plan doesn't tell senior debt holders how much they will recover.

Delphi has said that unsecured creditors, who were slated to be repaid 80 percent on their claims with Delphi's new common stock and 20 percent in cash, will instead get a higher percentage of stock and the option to buy additional shares at the discounted price of $34.98.

Current shareholders will no longer be able to buy shares in the reorganized company at a discount, but they will still have the option of purchasing as many as 12.7 million shares of Delphi's new common stock at face value of $41.58 a share.

General Motors Corp., Delphi's former parent and biggest customer, will also receive less cash. The auto maker will now receive a $750 million second-lien note and $1.2 billion in junior convertible preferred stock instead of $2.7 billion.

"We are pleased with the prompt action by the bankruptcy court in approving our first day motions," CEO Joe Malugen said. "This approval will allow our stores to continue to operate so that we can continue to serve our customers while implementing strategies to enhance our financial performance."

Movie Gallery's Canadian operations were not included in the filing. The final hearing about its financing from creditors is scheduled for Nov. 6.

The company announced in September plans to close 520 unprofitable stores across the country, including 14 in Alabama. It also entered into a restructuring program to reduce $1 billion debt incurred after buying the Hollywood Video chain in 2005.

New Century Financial Corp. (NEWC.PK: Quote, Profile, Research), the largest U.S. subprime lender now under bankruptcy protection, was authorized on Thursday to obtain up to $150 million of financing to keep operating under Chapter 11.

The package, which was announced Monday as the company announced its bankruptcy filing, includes up to $150 million of debtor-in-possession financing from The CIT Group and Greenwich Capital Financial Products Inc.
 
According to the Associated Press, U.S. Bankruptcy Judge Kevin Carey said he would agree to the interim financing. Carey earlier granted the lender interim authority to pay "its utility bills, remaining employees and other necessary expenses until the company's assets can be sold next month" the AP reported.

The Irvine, California-based company collapsed amid rising delinquencies and defaults, a federal criminal investigation into its accounting and trading in its securities, and orders by or agreements with at least 17 U.S. states to stop lending.

New Century has said it agreed to sell its loan servicing unit to hedge fund Carrington Capital Management LLC for $139 million, and some loans to Greenwich Capital for $50 million.

A federal jury on Monday convicted Mark Cocchiola and Steven Venechanos on 38 counts that included conspiracy, bank fraud, securities fraud, mail and wire fraud.

Cocchiola founded of the Paterson-based company; Venechanos was its chief financial officer and corporate secretary.

"These were corrupt businessmen," U.S. Attorney Christopher J. Christie said in a statement. "They bankrupted a company that was in reality a myth built on phony sales. They were driven by unbridled greed without a thought to the investors they charmed with their illusion of Suprema's success."

Cocchiola, 51, of Englewood Cliffs, and Venechanos, 48, of New Milford, could face dozens of years in prison and millions of dollars in fines when sentenced July 10 by U.S. District Judge Stanley R. Chesler. The heaviest penalties are for the 17 bank fraud charges, each of which carries up to 30 years in prison and a $1 million fine.

Cocchiola and Venechanos were indicted in July 2005. They were convicted following an eight-week trial in which the jury deliberated eight days.

The former controller of Suprema, along with a former manager and four former customers, pleaded guilty to charges including securities fraud and food adulteration charges.

Suprema was liquidated after filing for bankruptcy protection in March 2002.

Prosecutors said that Suprema used the illusion of its growth to conduct a series of secondary stock offerings, netting Suprema millions from investors. Meanwhile, Cocchiola got over $2.5 million, and Venechanos over $1 million, from selling their holdings.

Prosecutors also said that in the second half of 2001, nearly 20 percent of Suprema's reported inventory was imitation cheese that had been relabeled as higher-priced real cheese.

Subprime mortgage lender New Century Financial has filed for bankruptcy protection.

Once one of the largest providers of subprime mortgages in the United States and now a casualty of the slumping housing market and aggressive lending practices, the company said it is immediately firing 3,200 workers -- more than half its workforce. Company officials hope the business can be sold.

New Century officials also said they will sell the company's loan servicing business to Carrington Capital Management and its affiliate for approximately $139 million, subject to the approval of bankruptcy court.

New Century, based in Irvine, Calif., filed the bankruptcy action in Delaware.

More than two dozen subprime lenders have shut down in recent months, and others are scrambling to stay in business.