Kmart Wins Key Bankruptcy Ruling

Kmart Corp. won final approval from U.S. Bankruptcy Court to pay lawyers and advisors helping to reorganize the retailer, and the judge allowed payments to keep garbage from piling up at stores nationwide.

The court also approved Kmart payments to suppliers of alcoholic beverages for shipments made before its bankruptcy-protection filing, in order to keep the supplies coming, something the retailer called essential to maintaining a steady stream of customers. Several suppliers stopped shipments to the retailer after not receiving payments.

Judge Susan Pierson Sonderby gave Kmart the green light to pay $6 million to maintain shipments of imported goods from Martha Stewart, Kathy Ireland and other core brands.

Kmart became the largest retailer to file for bankruptcy when it sought protection in Chicago on Jan. 22.

Sonderby also approved a $6.4-million payment to Weyerhaeuser Co., which holds a garbage hauling contract for Kmart’s 2,100 stores nationwide.