By J.D. Morris From Vegas Inc

More than [eight] months after a major division of Caesars Entertainment Corp. filed for bankruptcy, it’s still unclear exactly how the company will emerge on the other side.

Caesars wants a Chicago bankruptcy court to approve a restructuring plan that could shed around $10 billion in debt from the division, but lawsuits from some of the company’s creditors continue to complicate things. One recent court decision in particular threatens to create big problems for the entire casino company.

If Caesars’ plan is successful, the division that filed for bankruptcy will be reorganized under a real estate investment trust setup that will split it into two parts: one that owns casinos and another that manages them. That setup would have Caesars follow in the footsteps of other casino companies — including Penn National Gaming, the company buying the Tropicana — that have made similar moves toward real estate investment trusts.

Despite the lingering questions surrounding the complicated bankruptcy case, however, some basic elements remain clear. Here are some of the main points you need to know about where the case stands.

1. Caesars Palace is the company’s only Las Vegas property included in the bankruptcy for now.

This has been true all along, but it’s worth reiterating.

Caesars Entertainment is a massive company that’s split into multiple divisions. The only division that filed for bankruptcy in January was Caesars Entertainment Operating Co., which has been described as the largest of the company’s units.

Accordingly, the only Las Vegas property included in the original bankruptcy filing is Caesars Palace. That means all of Caesars’ other properties on the Strip — such as the Flamingo, the Paris and the Linq hotel — were not. However, that may change (see next point).

Other areas where Caesars operates weren’t so lucky. Harrah’s Reno, Harrah’s Lake Tahoe, Harveys Lake Tahoe, Caesars Atlantic City and Bally’s Atlantic City were among the properties included in the bankruptcy filing in January.

So what does being a part of the filing mean for Caesars Palace? Not much at the moment. The property — as with other Caesars casinos — is open for business as usual, the company says.

2. But recent events suggest the whole company could go into bankruptcy.

The case hit an important milestone last week, and it did not work out well for Caesars.

Judge Benjamin Goldgar refused to shield the Caesars parent company from lawsuits by its creditors while the operating division is in bankruptcy. Caesars is appealing the decision, but it was denied a request this week that would have sped that process along.

That has further complicated the company’s attempt to stop suits against it before a judge in New York “can consider imposing billions of dollars in liability on the parent,” Bloomberg reported.

Caesars has said the suits could force the parent company into bankruptcy as well.

The creditors’ lawsuits generally have to do with the legitimacy of asset transfers Caesars made before the bankruptcy. The company is standing its ground.

“We believe our defenses in the New York litigation are strong and will continue to contest those cases vigorously,” Caesars spokesman Stephen Cohen said in a statement after Goldgar’s ruling last week. Cohen said the ruling was a “technical interpretation of bankruptcy law and did not address in any way the merits of the New York litigation.”

3. At the same time, Caesars has made progress in gathering support from creditors.

Days before the ruling last week, Caesars announced that a “significant amount” of second-lien debt holders signed an agreement that gives them a “substantial improvement” in what they can recover from the bankruptcy. Holders who sign the agreement could receive two different sets of $200 million in convertible notes, the company said.

Caesars needs more than 50 percent of its second-lien debt holders to sign the agreement for it to become effective. The company did not say last week exactly how close it was to that goal, but Bloomberg reported that the group owned about 30 percent of junior notes.

Caesars said the parent company and the operating division were working to capture further support of the agreement.

4. The case itself has already become really expensive.

A case as complicated as this one is bound to produce a hefty stack of legal bills. And they’re piling high: According to the Associated Press, the Caesars case resulted in about $47 million in professional fees and expenses from Jan. 15 through the end of May.

UNLV law professor Nancy Rapoport is leading the fee committee that’s reviewing all those costs. She said in a previous interview that such committees usually consider the ratio of the fees to everything else going on in the case. It’s “typically pretty proportional” to the amount of money at stake in the overall case, she said, “but it’s still a lot of money.”

5. It’s going to take a long time to resolve.

Don’t hold your breath for a conclusion to this case anytime soon. According to Bloomberg, Caesars’ original plan envisioned an exit from the bankruptcy by Feb. 9, but its newer plan is to emerge by July 15 of next year.

For more on this story go to: http://vegasinc.com/business/gaming/2015/jul/31/5-things-keep-mind-caesars-bankruptcy-progresses/

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