/raid1/www/Hosts/bankrupt/TCR_Public/070721.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

             Saturday, July 21, 2007, Vol. 11, No. 171

                             Headlines

ALLIED HOLDINGS: Posts $853,000 Net Loss in April 2007
INSIGHT HEALTH: Posts $4.6 Million Net Loss in May 2007
CATHOLIC CHURCH: San Diego Files May 2007 Operating Report
CATHOLIC CHURCH: Spokane Files May 2007 Operating Report
VESTA INSURANCE: Florida Select Files May 2007 Operating Report

VESTA INSURANCE: Florida Select Files June 2007 Operating Report
VESTA INSURANCE: J. Gordon Gaines Files May 2007 Operating Report

                             *********

ALLIED HOLDINGS: Posts $853,000 Net Loss in April 2007
------------------------------------------------------      
     
                    Allied Holdings, Inc.      
            Unaudited Consolidated Balance Sheet      
                    As of April 30, 2007      
                       (In Thousands)      
     
                           Assets      
     
Current Assets:      
      Cash and cash equivalents                          $19,687
      Receivables, net of allowances                      46,106
      Related party receivables                           22,270
      Inventories                                          4,929
      Deferred income taxes                                1,907
      Prepayments and other current assets                19,618
                                                       ---------      
         Total current assets                            114,517
     
Property and equipment, net                              139,185
Goodwill, net                                              3,545
Other noncurrent assets                                   31,952
Investment in related parties                             20,732
                                                       ---------      
TOTAL ASSETS                                            $309,931
                                                       =========      
     
Liabilities and Stockholders' Deficit      
     
Current liabilities not subject to compromise:      
       Accounts and notes payable                        $33,710
       Accrued liabilities                                55,258
                                                       ---------      
         Total current liabilities                        88,968
     
Long-term liabilities not subject to compromise      
       DIP credit facility                               205,000
       Postretirement benefits                            14,243
       Deferred income taxes                               1,926
       Other long-term liabilities                        17,780
                                                       ---------      
         Total long-term liabilities                     238,949
     
Liabilities subject to compromise                        199,393
Stockholders' deficit                                   (217,379)
                                                       ---------      
      Total liabilities & stockholders' deficit         $309,931
                                                       =========      

                    Allied Holdings, Inc.      
       Unaudited Consolidated Statement of Operations      
             For the Month Ended April 30, 2007      
                       (In Thousands)      

Revenues                                                 $70,474

Operating Expenses      
      Salaries, Wages & Fringe benefits                   35,431
      Operating supplies & expenses                       15,352
      Purchased transportation                             8,412
      Insurance & claims                                   3,121
      Operating tax & licenses                             2,343
      Depreciation & amortization                          2,293
      Rents                                                  736
      Communications & utilities                             505
      Other operating expenses                               853
      Loss on disposal of operating assets, net               12
                                                       ---------      
         Total Operating Expenses                         69,058
                                                       ---------      
         Operating Income (Loss)                           1,416
     
Other Income (Expense)      
      Interest expense                                    (3,349)
      Investment income                                       62
      Foreign exchange gains, net                          1,523
      Equity in earnings of subsidiaries                     737
                                                       ---------      
                                                          (1,027)
                                                       ---------      
Loss before reorganization items and income taxes            389
Reorganization items                                      (1,242)
                                                       ---------      
Loss before income taxes                                    (853)
Income tax benefit                                             0
                                                       ---------      
NET LOSS                                                   ($853)
                                                       =========
     
The Debtors disclose cash disbursements totaling $5,357,106
during April 2007.

                        About Allied Holdings

Based in Decatur, Georgia, Allied Holdings Inc. (AMEX: AHI, other
OTC: AHIZQ.PK) -- http://www.alliedholdings.com/-- and its  
affiliates provide short-haul services for original equipment
manufacturers and provide logistical services.  The company and 22
of its affiliates filed for chapter 11 protection on July 31, 2005
(Bankr. N.D. Ga. Case Nos. 05-12515 through 05-12537).  Jeffrey W.
Kelley, Esq., at Troutman Sanders, LLP, represents the Debtors in
their restructuring efforts.  Henry S. Miller at Miller Buckfire &
Co., LLC, serves as the Debtors' financial advisor.  Anthony J.
Smits, Esq., at Bingham McCutchen LLP, provides the Official
Committee of Unsecured Creditors with legal advice and Russell A.
Belinsky at Chanin Capital Partners, LLC, provides financial
advisory services to the Committee.  When the Debtors filed for
protection from their creditors, they estimated more than $100
million in assets and debts.  Allied Systems Holdings Inc.,
formerly Allied Holdings Inc., disclosed that effective May 29,
2007, it has emerged from bankruptcy.  (Allied Holdings Bankruptcy
News, Issue No. 53; Bankruptcy Creditors' Service, Inc.
http://bankrupt.com/newsstand/or 215/945-7000)  


INSIGHT HEALTH: Posts $4.6 Million Net Loss in May 2007
-------------------------------------------------------
InSight Health Services Holdings Corp. filed its monthly operating
report for May 2007 with the United States Bankruptcy Court for
the District of Delaware on July 16, 2007.

InSight Health reported a net loss of $4,562,000 on zero
revenues for the period ending May 31, 2007.

At May 31, 2007, InSight Health's balance sheet showed:

        Total Current Assets                    $87,086               
        Total Assets                      ($217,595,000)
        Total Liabilities                             -
        Total Shareholders' Deficit       ($217,595,000)

A full-text copy of InSight Health's May 2007, Monthly
Operating Report is available at no charge at:

               http://ResearchArchives.com/t/s?21a3

                          About InSight Health

Based in Lake Forest, California, InSight Health Services Holdings
Corp. -- http://www.insighthealth.com/-- is a nationwide provider  
of diagnostic imaging services.  It serves managed care entities,
hospitals and other contractual customers in over 30 states,
including the following targeted regional markets: California,
Arizona, New England, the Carolinas, Florida and the Mid-Atlantic
states.  InSight's network consisted of 109 fixed-site centers
and 108 mobile facilities as of Dec. 31, 2006.  The company and
its affiliate, InSight Health Services Corp., filed for Chapter 11
protection on May 29, 2007 (Bankr. D. Del. Case Nos. 07-10700 and
07-10701).  Daniel J. DeFranceschi, Esq., Jason M. Madron, Esq.,
and Mark D. Collins, Esq., at Richards, Layton & Finger, represent
the Debtors.  In schedules filed with the Court, Insight Health
Services Holdings disclosed total assets of $87,102,870 and total
debts of $525,448,053.  Its debtor-affiliates, Insight Health
Services Corp., disclosed total assets of $505,285,296 and total
debts of $525,500,934.  The Court confirmed the Debtors' pre-
packaged Chapter 11 Plan of Reorganization on July 10, 2007.


CATHOLIC CHURCH: San Diego Files May 2007 Operating Report
----------------------------------------------------------

                     Diocese of San Diego
                Statement of Financial Position
                      As of May 31, 2007

ASSETS

Cash and cash equivalents                            $21,479,936
Funds on deposit with administrative offices:
  Perpetual Care Funds                                         -
  Funds on deposit                                             -
  Other funds on deposit                                       -
Marketable securities                                 40,133,154
Accounts receivable, net of allowance
  Parishes and School                                          -
  PSDL Trust                                           1,088,263
  Diocesan Admin Office for Mater Dei                    675,225
  Cemetery trade                                               -
  Tuition, fees and others                             4,348,120
  Juan Diego Trust                                       532,748
Notes and other receivables                              118,360
Planned gifts receivable                                 122,254
Prepaid expenses                                       2,357,998
Inventory                                                 28,711
Loan to parishes, net                                     14,507
Pledges receivable $450,429 allowance                          -
Demand note receivable - CSE                                   -
Revisionary Interest in CSE                           65,000,000
Property and equipment, net                           20,937,082
Other land and buildings, net
  Cemetery inventory - graves, crypts & niches         6,623,363
  Cemetery undeveloped land & outside property         1,365,794
  Mater Dei land and land improvements                13,819,408
  Mater Dei buildings                                 52,850,948
  Oceanside land and land improvements                 5,551,035
Other assets                                                   -
                                                  --------------
Total Assets                                        $237,046,909
                                                  ==============

LIABILITIES AND NET ASSETS

Liabilities:
  Accounts payable and accrued liabilities            $2,195,162
  Special collections                                    392,446
  Accrued vacation                                       339,761
  Construction loan - ALSAM Foundation                38,643,296
  Payable to PSDL Trust                               23,388,572
  Funds on deposit:
     Parish and school funds & endowments                723,792
     Perpetual Care Funds                                    472
     Restricted funds on deposit                               -
     Other diocesan entities funds                             -
  Reserve for worker's compensation claims             1,564,509
  Priest retirement plan liability                     1,965,879
  Planned gifts liability                              1,327,535
  Deferred revenue:
     Annual Catholic Appeal                                    -
     Cemetery                                          3,220,631
     Tuition and other fees                            1,157,079
     Other                                                 3,301
                                                  --------------
  Total liabilities                                   74,922,436
                                                  --------------
Net Assets:
  Unrestricted:
     Undesignated                                    116,516,174
     Insurance reserve funds                           7,334,669
     Bishop's burse                                    1,318,447
     Designated funds                                    320,776
     Property and equipment                           16,554,455
                                                  --------------
  Total unrestricted                                 142,044,521

  Temporarily restricted                              11,720,250
  Permanently restricted                               8,359,702
                                                  --------------
  Total net assets                                   162,124,473
                                                  --------------
  Total liabilities and net assets                  $237,046,909
                                                  ==============

                     Diocese of San Diego
                    Statement of Activities
               For the month ending May 31, 2007

Support and revenue:
  Parish assessments                                  $1,812,123
  Donations and fund-raising                           1,606,957
  Investment income                                    2,254,870
  Interest and other income                              183,273
  Parish & employee insurance reserve funds, net         868,553
  Rental income                                           58,663
  Administrative fees                                    697,062
  Gain on sale of property                                     -
  Cemetery sales                                         913,407
  Tuition, net of tuition assistance                   1,552,400
  Student and other fees                                  69,529
  San Juan Diego English language center                       -
  Concessions/food service                                53,835
  Other                                                   97,104
                                                  --------------
Total support and revenue                             10,167,776

Expenses:
  Administrative fees                                    672,848
  Programs                                               961,057
  Annual Catholic Appeal                                   6,966
  Distribution of restricted donations                    48,199
  Cemetery cost of sales                                 101,945
  San Juan Diego English language center                  39,931
  General:
     Contributions and charitable programs               127,896
     Schools dept. - support for schools                  25,000
     Interest expense
        Funds on deposit                                  90,852
        Other                                             38,142
     Depreciation                                        124,342
     Bad debt expense                                        912
     Recruiting, advertising & public relations           38,873
     Student related expenses                            422,995
     Concessions/food service                             40,204
     Athletics                                            45,940
     Development/special events                            2,895
     Operating expenses                                1,632,585
     Chaplaincies and ministries                         174,344
     Assessments                                          54,390
     Professional fees                                    42,473
     Chapter 11 fees
        Legal fees                                         7,736
        UST fees                                               -
        Accounting fees                                        -
     Insurance                                             1,453
     Other                                               140,577
                                                  --------------
Total Expenses                                         5,092,565

  Funds released from restricted funds                   262,849
  Net change in designated funds                         (12,837)
                                                  --------------
                                                         250,012
                                                  --------------
Increase (decrease) in net assets                      5,075,211
                                                  --------------
Net assets:
  Beginning of month                                 157,049,263
                                                  --------------
  End of month                                      $162,124,473
                                                  ==============

                     Diocese of San Diego
                Cash Receipts and Disbursement
               For the month ending May 31, 2007

Total receipts - prior general account reports       $10,524,369
Less: total disbursements                              6,199,192
Beginning balance                                     17,743,459

Receipts during current period:
  Transfers from main account                             55,000
  Accounts receivable - pre-filing                       221,878
  Accounts receivable - post-filing                          754
  Accounts receivable - assessments pre-filing             4,961
  Accounts receivable - assessments                      603,140
  Other receivables                                      218,160
  Planned gifts collection                             3,000,000
  Receipts - health premiums                           1,158,198
  Rental income                                           14,063
  Annual Catholic Appeal                                 204,272
  Interest                                                10,111
  Dividends                                                  196
  Transfers from Service Recipients
     Workers' compensation premium                       157,115
     Priest health - SIF Portion                           4,876
  Miscellaneous                                            9,863
  Tribunal income                                         51,504
  Southern Cross income                                   13,679
  Programs and ministries                                528,967
  Registration and tuitions                              258,069
  Insurance                                               27,522
  Receipts - reimbursements and other                        382
  Parish and school funds & endowments                   326,382
  Other Diocesan locations' deposits                     158,274
  Stock processing                                       333,415
  Special collections                                    136,647
  Athletics                                                1,318
  Concessions and store sales                             11,563
  Restricted account receipts                             24,787
  Donations                                               26,958
                                                  --------------
Total receipts                                         7,562,067

Balance                                               25,305,526

Less: Total disbursements during current period
  Transfers to Service Recipients                              -
  Transfers to Diocese                                   150,000
  Transfers to Priest Health Account                      55,000
  Transfers to payroll account                           374,655
  Administrative                                           4,897
  A/R CES                                                  4,459
  Athletics                                               16,380
  Bank fees and charges                                   10,468
  Stock                                                   70,456
  Conferences                                             26,871
  Dues/Fees                                               51,134
  Fundraising                                                204
  Education expenses                                     221,768
  Employee benefits                                        7,238
  FF&E                                                    18,631
  Health insurance and benefits                           69,758
  Health insurance claims paid                            96,147
  Health insurance premiums paid                         909,203
  Lay salaries and wages                                 475,378
  Liability insurance                                      8,441
  Maintenance/Repairs                                     42,503
  Medical reimbursements                                  15,482
  Ministries                                              32,909
  Miscellaneous                                            7,303
  Supplies                                                13,734
  Operations                                             219,079
  Payroll                                                 64,465
  Postage                                                 14,450
  Professional fees                                       57,051
  Printing                                                33,401
  Rent                                                    17,600
  Restricted                                              41,992
  Workers' comp - prefunds and losses                    146,989
  Stipends/Services                                       45,237
  Utilities                                               27,929
  Voids                                                   (2,462)
                                                  --------------
                                                       3,348,766
                                                  --------------
Ending balance                                       $21,956,760
                                                  ==============

                    About the San Diego Diocese

The Roman Catholic Diocese of San Diego in California --
http://www.diocese-sdiego.org/-- employs approximately  
3,000 people in various areas of work.  The Diocese filed for
Chapter 11 protection just before commencement of the first of
court proceedings for 140 sexual abuse lawsuits filed against the
Diocese.  Authorities of the San Diego Diocese said they were not
in favor of litigating their cases.

The San Diego Diocese filed for chapter 11 protection on Feb. 27,
2007 (Bankr. S.D. Calif. Case No. 07-00939).  Gerald P. Kennedy,
Esq., at Procopio, Cory, Hargreaves and Savitch LLP, represents
the Diocese.  In its schedules of assets and liabilities, the
Diocese listed total assets of $152,510,888 and total liabilities
of $72,754,092.

On March 27, 2007, the Debtor filed its plan and disclosure
statement.  The Debtor has asked to the Court to extend its
exclusive period to file a chapter 11 plan to 60 days after the
completion of the Mediation Process.  (Catholic Church Bankruptcy
News, Issue No. 96; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).


CATHOLIC CHURCH: Spokane Files May 2007 Operating Report
--------------------------------------------------------

                  Catholic Diocese of Spokane
                         Balance Sheet
                      As of May 31, 2007

ASSETS
  Total Cash Accounts                                 $3,516,929
  Total Transfer Account                                       -
  Total Investments                                    4,085,781
  Total Property                                         495,004
  Total Loans Receivable                               2,476,136
  Total Interfund Loan Receivable                        217,912
  Total Accounts Receivable                              110,152
  Total Land and Buildings & Equipment                 2,120,834
  Total Prepaid Expenses                                 149,988
                                                  --------------
Total Assets                                         $13,172,739
                                                  ==============

LIABILITIES AND NET ASSETS

Liabilities
  Total Deposits Payable                               8,620,765
  Total Interest Payable                                       -
  Total Accounts Payable                                  31,275

Total Long-term Liabilities                            9,269,297

Net Assets
  Total Unrestricted - Fund Balance                  (18,118,569)
  Total Unrestricted Net Assets                      (18,118,569)
  T.R. - Guse Grant Funds                                418,180
  T.R. - Bishop's School Grants Funds                     72,727
  T.R. - Bishop's Discretionary Funds                     65,681
  Total Replacement Fund                              10,653,684
  Total Diocesan D&L Funding                           2,176,115
  Total Guatemala Funds                                  540,172
  Temporarily Restricted                                       -
                                                  --------------
Total liabilities & net assets                       $13,172,739
                                                  ==============

                  Catholic Diocese of Spokane
                 Income and Expense Statement
               For the month ending May 31, 2007

Total Income                                            $391,836
Total Expenses                                           641,040
                                                  --------------
Net Excess or Deficit                                   $249,203
                                                  ==============

The Diocese of Spokane's Statement of Cash Receipts and
Disbursements for May 2007 shows that cash receipts for the
period total $505,516, while disbursements total $368,410.

                    About The Diocese of Spokane

The Roman Catholic Church of the Diocese of Spokane filed for
chapter 11 protection (Bankr. E.D. Wash. Case No. 04-08822) on
Dec. 6, 2004.  Michael J. Paukert, Esq., at Paine, Hamblen,
Coffin, Brooke & Miller, LLP, represents the Spokane Diocese in
its restructuring efforts.  When the Debtor filed for protection
from its creditors, it listed $11,162,938 in total assets and
$81,364,055 in total debts.

The Diocese of Spokane, the Tort Claimants Committee, the Future
Claims Representative, and the Executive Committee of the
Association of Parishes delivered an Amended Plan of
Reorganization, and a Disclosure Statement describing that Plan
to the Court on Feb. 1, 2007.  The Honorable Patricia C. Williams
approved the disclosure statement on March 8, 2007.  On April 24,
2007, the Court confirmed Spokane's 2nd Amended Joint Plan.
(Catholic Church Bankruptcy News, Issue No. 96; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or   
215/945-7000).


VESTA INSURANCE: Florida Select Files May 2007 Operating Report
---------------------------------------------------------------

                Florida Select Insurance Agency, Inc.
                        Income Statement
                     Month Ended May 31, 2007

Revenue from Total Sales                                     $0
Less:
  Cost of Sales                                               0
                                                   ------------
Gross Profit                                                 $0

Less:
  Operating Expenses                                        (48)
                                                   ------------
Net Profit Operations                                        48

Non-Operating Income (Expenses)
  Interest Earned                                        11,927
  Vendor Refund                                               -
                                                   ------------
Net Profit (Loss)                                       $11,879
                                                   ============

                 Florida Select Insurance Agency, Inc.
             Schedule of Cash Receipts and Disbursements
                     Month Ended May 31, 2007

Cash On Hand (Beginning)                            $3,296,619

Cash Receipts:
  Accounts Receivable                                        0
  Management Fees                                            0
  Loan Proceeds                                              0
  Sale of Property                                           0
  Interest Earned                                       11,927
                                                  ------------
Total Receipts                                          11,927

Cash Disbursements:
  Business Disbursements Form BA-02(B)                      48
                                                  ------------
  Surplus Or Deficit                                    11,879
                                                  ------------
  Cash on Hand (End)                                $3,308,498
                                                  ------------

                       About Florida Select

Based in Birmingham, Alabama, Florida Select Insurance Agency,
Inc. -- http://www.floridaselect.com/-- provides residential    
insurance for Florida and South Carolina property owners.  Florida
Select is an affiliate of Vesta Insurance Group, Inc.  The company
filed for chapter 11 protection on April 24, 2007 (BAnkr. N.D.
Ala. Case No. 07-01849).  Rufus Dorsey, IV, Esq., at Parker Hudson
Rainer & Dobbs LLP, represents Florida Select.

                       About Vesta Insurance

Headquartered in Birmingham, Alabama, Vesta Insurance Group, Inc.
(Other OTC: VTAI.PK) -- http://www.vesta.com/-- is a holding    
company for a group of insurance companies that primarily offer
property insurance in targeted states.

Wyatt R. Haskell, Luther S. Pate, UV, and Costa Brava Partnership
III, L.P., filed an involuntary chapter 7 petition against the
company on July 18, 2006 (Bankr. N.D. Ala. Case No. 06-02517).
The case was converted to a voluntary chapter 11 case on Aug. 8,
2006 (Bankr. N.D. Ala. Case No. 06-02517).  Eric W. Anderson,
Esq., at Parker Hudson Rainer & Dobbs, LLP, represents the Debtor.
R. Scott Williams, Esq., at Haskell Slaughter Young & Rediker,
LLC, represents the petitioning creditors.  In its schedules of
assets and liabilities, Vesta listed $14,919,938 in total assets
and $214,278,847 in total liabilities.

J. Gordon Gaines Inc. is a Vesta Insurance-owned unit that
manages the company's numerous insurance subsidiaries and employs
the headquarters workers.  The company filed for chapter 11
protection on Aug. 7, 2006 (Bankr. N.D. Ala. Case No. 06-02808).
Eric W. Anderson, Esq., at Parker Hudson Rainer & Dobbs, LLP,
represent the Debtor in its restructuring efforts.   In its
schedules of assets and liabilities, Gaines listed $19,818,094 in
total assets and $16,046,237 in total liabilities.

On Aug. 1, 2006, the District Court of Travis County, Texas
entered an order appointing the Texas Commissioner of Insurance
as Liquidator of Vesta Insurance's Texas-domiciled subsidiaries:
Vesta Fire Insurance Corporation; The Shelby Insurance Company;
Shelby Casualty Insurance Corporation; Texas Select Lloyds
Insurance Company; and Select Insurance Services, Inc.

On Oct. 11, 2006, both Vesta and Gaines filed separate Plans of
Liquidation and Disclosure Statements.  They filed an amended Plan
on Nov. 7, 2006, and a Second Amended Plan on Nov. 10, 2006.  The
Court approved the Disclosure Statements of Vesta and Gaines on
Nov. 10, 2006.  On Dec. 22, 2006, the Court confirmed the Third
Amended Plans of Vesta and Gaines.

(Vesta Bankruptcy News, Issue No. 23; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000


VESTA INSURANCE: Florida Select Files June 2007 Operating Report  
----------------------------------------------------------------

              Florida Select Insurance Agency, Inc.
                       Income Statement
                    Month Ended June 30, 2007

Revenue from Total Sales                                    $0
Less:
  Cost of Sales                                              0
                                                  ------------
Gross Profit                                                $0

Less:
Operating Expenses                                      2,733
                                                  ------------
Net Profit Operations                                   (2,733)

Non-Operating Income (Expenses)
  Interest Earned                                       11,667
  Vendor Refund                                            101
                                                  ------------
Net Profit (Loss)                                       $9,035
                                                  ============

               Florida Select Insurance Agency
         Schedule of Cash Receipts and Disbursements
                 Month Ended June 30, 2007

Cash On Hand (Beginning)                            $3,308,498

Cash Receipts:
Accounts Receivable                                         0
Management Fees                                             0
Loan Proceeds                                               0
Sale of Property                                            0
Interest Earned                                        12,766
Vendor Refund                                             101
                                                  ------------
Total Receipts                                          12,867

Cash Disbursements:
  Business Disbursements                                 2,733
                                                  ------------
  Surplus Or Deficit                                    10,134
                                                  ------------
  Cash on Hand (End)                                $3,318,632
                                                  ============

                       About Florida Select

Based in Birmingham, Alabama, Florida Select Insurance Agency,
Inc. -- http://www.floridaselect.com/-- provides residential    
insurance for Florida and South Carolina property owners.  Florida
Select is an affiliate of Vesta Insurance Group, Inc.  The company
filed for chapter 11 protection on April 24, 2007 (BAnkr. N.D.
Ala. Case No. 07-01849).  Rufus Dorsey, IV, Esq., at Parker Hudson
Rainer & Dobbs LLP, represents Florida Select.

                       About Vesta Insurance

Headquartered in Birmingham, Alabama, Vesta Insurance Group, Inc.
(Other OTC: VTAI.PK) -- http://www.vesta.com/-- is a holding    
company for a group of insurance companies that primarily offer
property insurance in targeted states.

Wyatt R. Haskell, Luther S. Pate, UV, and Costa Brava Partnership
III, L.P., filed an involuntary chapter 7 petition against the
company on July 18, 2006 (Bankr. N.D. Ala. Case No. 06-02517).
The case was converted to a voluntary chapter 11 case on Aug. 8,
2006 (Bankr. N.D. Ala. Case No. 06-02517).  Eric W. Anderson,
Esq., at Parker Hudson Rainer & Dobbs, LLP, represents the Debtor.
R. Scott Williams, Esq., at Haskell Slaughter Young & Rediker,
LLC, represents the petitioning creditors.  In its schedules of
assets and liabilities, Vesta listed $14,919,938 in total assets
and $214,278,847 in total liabilities.

J. Gordon Gaines Inc. is a Vesta Insurance-owned unit that
manages the company's numerous insurance subsidiaries and employs
the headquarters workers.  The company filed for chapter 11
protection on Aug. 7, 2006 (Bankr. N.D. Ala. Case No. 06-02808).
Eric W. Anderson, Esq., at Parker Hudson Rainer & Dobbs, LLP,
represent the Debtor in its restructuring efforts.   In its
schedules of assets and liabilities, Gaines listed $19,818,094 in
total assets and $16,046,237 in total liabilities.

On Aug. 1, 2006, the District Court of Travis County, Texas
entered an order appointing the Texas Commissioner of Insurance
as Liquidator of Vesta Insurance's Texas-domiciled subsidiaries:
Vesta Fire Insurance Corporation; The Shelby Insurance Company;
Shelby Casualty Insurance Corporation; Texas Select Lloyds
Insurance Company; and Select Insurance Services, Inc.

On Oct. 11, 2006, both Vesta and Gaines filed separate Plans of
Liquidation and Disclosure Statements.  They filed an amended Plan
on Nov. 7, 2006, and a Second Amended Plan on Nov. 10, 2006.  The
Court approved the Disclosure Statements of Vesta and Gaines on
Nov. 10, 2006.  On Dec. 22, 2006, the Court confirmed the Third
Amended Plans of Vesta and Gaines.

(Vesta Bankruptcy News, Issue No. 23; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000


VESTA INSURANCE: J. Gordon Gaines Files May 2007 Operating Report
-----------------------------------------------------------------

                     J. Gordon Gaines, Inc.
                        Income Statement
                  Month Ended in May 31, 2007

Revenue from Total Sales                                    $0
Less:
  Cost of Sales                                              0
                                                  ------------
Gross Profit                                                $0

Less:
  Operating Expenses                                   (73,449)
                                                  ------------
Net Profit Operations                                   73,449

Non-Operating Income (Expenses)
  Interest Earned                                        2,971
  State Tax Refunds                                          0
  Non-operational income                                     0
  Sale of Property                                           0
                                                  ------------
Net Profit (Loss)                                     ($70,478)
                                                  ============

                     J. Gordon Gaines, Inc.
           Schedule of Cash Receipts and Disbursements
                    Month Ended May 31, 2007

Cash On Hand (Beginning)                              $919,874

Cash Receipts:
  Accounts Receivable                                        0
  Management Fees                                            0
  Loan Proceeds                                              0
  Sale of Property                                           0
  Interest Earned                                        2,971
  Miscellaneous Income                                       0
  Non-operational Income                                     0
  Funding Under Post-Confirmation Agreement            130,190
                                                  ------------
Total Receipts                                         133,161

Cash Disbursements:
  Business Disbursements Form BA-02(B)                 203,639
                                                  ------------
  Surplus Or Deficit                                   (70,478)
                                                  ------------
  Cash on Hand (End)                                  $849,396
                                                  ============

                       About Vesta Insurance

Headquartered in Birmingham, Alabama, Vesta Insurance Group, Inc.
(Other OTC: VTAI.PK) -- http://www.vesta.com/-- is a holding    
company for a group of insurance companies that primarily offer
property insurance in targeted states.

Wyatt R. Haskell, Luther S. Pate, UV, and Costa Brava Partnership
III, L.P., filed an involuntary chapter 7 petition against the
company on July 18, 2006 (Bankr. N.D. Ala. Case No. 06-02517).
The case was converted to a voluntary chapter 11 case on Aug. 8,
2006 (Bankr. N.D. Ala. Case No. 06-02517).  Eric W. Anderson,
Esq., at Parker Hudson Rainer & Dobbs, LLP, represents the Debtor.
R. Scott Williams, Esq., at Haskell Slaughter Young & Rediker,
LLC, represents the petitioning creditors.  In its schedules of
assets and liabilities, Vesta listed $14,919,938 in total assets
and $214,278,847 in total liabilities.

J. Gordon Gaines Inc. is a Vesta Insurance-owned unit that
manages the company's numerous insurance subsidiaries and employs
the headquarters workers.  The company filed for chapter 11
protection on Aug. 7, 2006 (Bankr. N.D. Ala. Case No. 06-02808).
Eric W. Anderson, Esq., at Parker Hudson Rainer & Dobbs, LLP,
represent the Debtor in its restructuring efforts.   In its
schedules of assets and liabilities, Gaines listed $19,818,094 in
total assets and $16,046,237 in total liabilities.

On Aug. 1, 2006, the District Court of Travis County, Texas
entered an order appointing the Texas Commissioner of Insurance
as Liquidator of Vesta Insurance's Texas-domiciled subsidiaries:
Vesta Fire Insurance Corporation; The Shelby Insurance Company;
Shelby Casualty Insurance Corporation; Texas Select Lloyds
Insurance Company; and Select Insurance Services, Inc.

On Oct. 11, 2006, both Vesta and Gaines filed separate Plans of
Liquidation and Disclosure Statements.  They filed an amended Plan
on Nov. 7, 2006, and a Second Amended Plan on Nov. 10, 2006.  The
Court approved the Disclosure Statements of Vesta and Gaines on
Nov. 10, 2006.  On Dec. 22, 2006, the Court confirmed the Third
Amended Plans of Vesta and Gaines.

(Vesta Bankruptcy News, Issue No. 23; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).  

                             *********

Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par.  Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable.  Those sources may not,
however, be complete or accurate.  The Monday Bond Pricing table
is compiled on the Friday prior to publication.  Prices reported
are not intended to reflect actual trades.  Prices for actual
trades are probably different.  Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind.  It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.

Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets.  At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.  
Don't be fooled.  Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets.  A company may establish reserves on its balance sheet for
liabilities that may never materialize.  The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.

A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged.  Send announcements to
conferences@bankrupt.com/

On Thursdays, the TCR delivers a list of recently filed chapter 11
cases involving less than $1,000,000 in assets and liabilities
delivered to nation's bankruptcy courts.  The list includes links
to freely downloadable images of these small-dollar petitions in
Acrobat PDF format.

Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals.  All titles are
available at your local bookstore or through Amazon.com.  Go to
http://www.bankrupt.com/books/to order any title today.

Monthly Operating Reports are summarized in every Saturday edition
of the TCR.

For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911.  For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.

                             *********

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., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland,
USA.  Marie Therese V. Profetana, Shimero R. Jainga, Ronald C. Sy,
Joel Anthony G. Lopez, Cecil R. Villacampa, Jason A. Nieva,
Melanie C. Pador, Ludivino Q. Climaco, Jr., Loyda I. Nartatez,
Tara Marie A. Martin, John Paul C. Canonigo, Sheena Jusay, and
Peter A. Chapman, Editors.

Copyright 2007.  All rights reserved.  ISSN: 1520-9474.

This material is copyrighted and any commercial use, resale or
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re-mailing and photocopying) is strictly prohibited without prior
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herein is obtained from sources believed to be reliable, but is
not guaranteed.

The TCR subscription rate is $775 for 6 months delivered via e-
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for the term of the initial subscription or balance thereof are
$25 each.  For subscription information, contact Christopher Beard
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                    *** End of Transmission ***