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T R O U B L E D   C O M P A N Y   R E P O R T E R
      
    Monday, March 9, 1998, Vol. 2, No. 46                 
                    
                   Headlines


ALLIANCE ENTERTAINMENT: Hearing on Stipulation and Order
DELOREAN MOTOR: Andersen to Pay $46.2m to Trustee
HOME HOLDINGS: Hearing on Confirmation of Plan
LEVITZ: Seeks to Sell Georgia Property to Home Luxury
MARVEL ENTERTAINMENT: Chase Indicates Willingness on Loans

MARVEL ENTERTAINMENT: Hearing on Confirmation of Plan
MARVEL ENTERTAINMENT: NYSE Reviews Listing
MARVEL ENTERTAINMENT: Reports Fourth Quarter Net Loss
MIDCOM: Must Delay Plan Confirmation Until June 30
MOLTEN METAL: Change of Address

OXFORD HEALTH: Files Schedule 13-G
PHAR-MOR: Founder Acquitted on Jury Charges
PHELPS TECHNOLOGY: Emergency Hearing on Auction Sales
PROCTOR & GAMBLE: Vietnam Unit Averts Bankruptcy
SA TELECOMMUNICATIONS: Greyrock Files Objections

TELE-COMMUNICATIONS: Will File Bankruptcy Due to Lawsuit
TRUSTED HEALTH: Files Chapter 7 After Judgment

                    *******


ALLIANCE ENTERTAINMENT: Hearing on Stipulation and Order
--------------------------------------------------------
The Court has ordered a hearing scheduled to consider
approval of a Stipulation and Order among EMI Music
Distribution, Capitol Records, Inc., and the Debtors,
Alliance Entertainment Corp. on March 19, 1998 in the
Southern District of New York. Pursuant to the terms of the
Stipulation and Order, the Debtors have agreed to reject a
certain distribution agreement between the Debtors and the
EMI Group and the EMI Group has agreed to enter into an
agreement to accept returns of merchandise from the extend
trade credit to the Debtors.


DELOREAN MOTOR: Andersen to Pay $46.2m to Trustee
-------------------------------------------------
A state-court jury here ordered Arthur Andersen to pay the
bankruptcy trustee for DeLorean Motor Co. $46.2 million in
damages for the accounting firm's role in the 1982 collapse
of the auto maker. With interest, the award could rise to
an estimate $110 million.

The jury found that the Big Six accounting firm had
committed negligence and breach of contract when it
rendered clean audit opinions on the now-defunct auto
maker's financial statements for the years 1978 and 1979.

The jury decided, based partly on a surprisingly candid
internal memo, that the accountants knew that John DeLorean
and business associates had committed fraud when they
diverted $17.6 million in corporate funds in 1978. Mr.
DeLorean was later charged with tax fraud but acquitted.
One associate was convicted for conspiracy in Ireland and
imprisoned.

Andersen plans to appeal.
(Wall Street Journal 6-Mar-1998)


HOME HOLDINGS: Hearing on Confirmation of Plan
----------------------------------------------
Home Holdings, Inc. is seeking confirmation of its proposed
Amended Plan of Reorganization, dated March 3, 1998. The
court of the Southern District of New York approved the
Debtor's Disclosure Statement, dated January 15, 1998, as
amended, as containing adequate information and authorized
the Debtor to solicit acceptances of its Plan. The Plan
will be binding on all holders of claims against the
Debtor. Equity security holders, however, will receive no
distributions under the Plan. A hearing to consider
confirmation of the Plan is scheduled for April 3, 1998
before the Hon. Jeffry H. Gallet. March 27, 1998 is the
last date to file objections to the Plan.


LEVITZ: Seeks to Sell Georgia Property to Home Luxury
-----------------------------------------------------
Looking to vacate the Georgia market, Levitz is seeking
approval to sell property and equipment in Doraville, Ga.,
to Home Luxury Corp. of America for $4.5 million.  "The
Debtors are seeking court approval of the Doraville
Property sale to reduce their secured indebtedness and
thereby facilitate the formulation and ultimate
confirmation of a reorganization plan that will yield the
highest possible returns to the Debtors' general unsecured
creditors," the retailer said.


MARVEL ENTERTAINMENT: Chase Indicates Willingness on Loans
----------------------------------------------------------
In connection with the appointment of the chapter 11
trustee for Marvel Entertainment Group, Inc., Chase
Manhattan Bank has advised the Company that it is willing
to lead a syndicate to make loans to Marvel subject to
execution of definitive documentation and agreement on key
terms. The United States Federal District Court for
Delaware's approval is required for such additional loans
to the Company. There can be no assurance such approval
will be granted by the court.


MARVEL ENTERTAINMENT: Hearing on Confirmation of Plan
-----------------------------------------------------
On February 13, 1998 Toy Biz, Inc. and the Secured Lenders'
filed an Amended Joint Plan of Reorganization Proposed by
the Secured Lenders and Toy Biz dated as of February 12,
1998. On February 13 Toy Biz also filed a Second Amended
Disclosure Statement of Toy Biz, Inc. Relating to Amended
Joint Plan of Reorganization Proposed by the Secured
Lenders and Toy Biz, Inc. dated as of February 12. On
February 20, the Court entered an order approving the
Disclosure Statement as containing "adequate information",
which order was amended on March 3.

Under the Toy Biz Plan, prepetition unsecured creditors
will in the aggregate receive up to a maximum of $4 million
in cash, up to a maximum of $4 million in notes, up to a
maximum of 1 million plan warrants, and between 5% to 10%
from litigation recoveries against third parties. Marvel
stockholders will receive subscription rights excercisable
prior to the closing of the combination to purchase common
stock at a price of $9.625 per share, up to a maximum of 4
million such rights. Exercise of the warrants and
subscription rights will dilute the ownership interests of
the other stockholders in the combined company.

Under the Toy Biz Plan, prepetition unsecured creditors
will in the aggregate receive up to a maximum of $4 million
in cash, up to a maximum of $4 million in notes, up to a
maximum of 1 million plan warrants, and between 5% to 10%
from litigation recoveries against third parties. Marvel
stockholders will receive subscription rights excercisable
prior to the closing of the combination to purchase common
stock at a price of $9.625 per share, up to a maximum of 4
million such rights. Exercise of the warrants and
subscription rights will dilute the ownership interests of
the other stockholders in the combined company.

The United States Federal District Court for Delaware
entered an order dated March 3, 1998 permitting the
distribution of up to 12,500,000 already outstanding shares
of Marvel common stock pledged to secure (i) Senior Secured
Discount Notes issued by Marvel Holdings, Inc., (ii) Senior
Secured Discount Notes issued by Marvel (Parent) Holdings,
Inc.; and (iii) Series B Senior Secured Notes issued by
Marvel III, Inc. to the holders of such notes. In addition,
the order authorized the sale by Marvel Holdings, Inc. for
cash of 2,500,000 shares of Marvel common stock currently
held by it in escrow to pay certain administrative
expenses. The chapter 11 trustee is currently determining
whether he will seek a rehearing, a stay of this order
and/or appeal of the order.

A hearing to consider confirmation of the Joint Plan and
any objections thereto shall be held before the Honorable
Roderick R. McKelvie, of the District of Delaware. Any
objection to confirmation of the Joint Plan must be filed
by April 10, 1998.  A hearing to consider confirmation of
the Joint Plan is scheduled on May 4, 1998.


MARVEL ENTERTAINMENT: NYSE Reviews Listing
------------------------------------------
The Company has been notified by the New York Stock
Exchange that the exchange is reviewing whether to continue
listing the Company's common stock on the New York Stock
Exchange.  There can be no assurance that the New York
Stock Exchange will continue to list the Company's common
stock. If the Company's common stock is delisted by the New
York Stock Exchange, the Company may seek to list its
shares on another exchange or on NASDAQ. There can be no
assurance that a listing of its shares will be available.


MARVEL ENTERTAINMENT: Reports Fourth Quarter Net Loss
-----------------------------------------------------
Marvel Entertainment Group, Inc. (NYSE: MRV) reported March
5, 1998 it expects to report a fourth quarter net loss in
the range of $165 - $205 million and a loss for the year
ended December 31, 1997 in the range of $265 - $305
million, which includes the write-down of goodwill. During
the fourth quarter the Company continued to experience the
negative effects of its bankruptcy proceedings across all
lines of business.

Due to the continued market weakness in the trading card
industry and the children's entertainment sticker business,
the Company has determined that its trading card goodwill
has been further impaired and the children's entertainment
sticker business has also been impaired. The Company has
estimated that this impairment will result in a non-cash
charge in the fourth quarter in the range of $115 - $145
million.

The Company incurred approximately $3 million in
reorganization costs, interest-related expenses of $9
million and other non-operating charges of approximately $7
million in the fourth quarter.  

During the fourth quarter, the Company restructured its
publishing and licensing operations and has narrowed
operating losses in these businesses in the fourth quarter
as compared to the third quarter ended September 30, 1997.


MIDCOM: Must Delay Plan Confirmation Until June 30
--------------------------------------------------
Midcom Communications Inc. said it must oppose any attempt
to confirm a liquidating reorganization plan before June 30
or jeopardize $43.5 million held in escrow from its asset
sale to WinStar Communications Inc.  Midcom said the
agreement with WinStar imposes the requirement, and the
best way for the company to adhere to the mandate is to
"control the plan process directly."  Midcom made the
statements in response to the creditors' committee's motion
asking the court to modify the exclusive period for filing
a plan, so that the committee could file its own plan for
the company.
(Federal Filings 5-Mar-1998)


MOLTEN METAL: Change of Address
-------------------------------
Effective March 2, 1998, Molten Metal Technology, Inc. (the
"Company") moved its corporate offices from Waltham, Mass.
to Fall River, Mass. The Company's new address and phone
number are as follows:

Molten Metal Technology, Inc.
421 Currant Road
Fall River, MA 02720
508-675-3900


MOLTEN METAL: Files January Operating Report
--------------------------------------------
Molten Metal Technology, Inc. has filed its Monthly
Operating Report as of January 31, 1998 with the SEC. The
Debtor reports a net loss of $3,799,805 on a net revenue of
$1,797,407. The reported loss includes interest expenses of
$90,855 and Depreciation and Amortization expenses of
$1,217,312.


OXFORD HEALTH: Files Schedule 13-G
----------------------------------
Oxford Health Plans, Inc. has notified the SEC in a 13-G
filing that it is the beneficial owner of 2,090,109 shares
of common stock of FPA Medical Management, Inc., par value
$0.002 per share, representing 5.1% of this class.


PHAR-MOR: Founder Acquitted on Jury Charges
-------------------------------------------
The founder of the Phar-Mor Inc. drugstore chain, who is
serving 18 years in prison for corporate fraud, has been
acquitted of trying to influence a juror in his first
trial.

Monus was charged with obstruction after his first trial,
in 1994, ended in a hung jury. He was accused of telling a
go-between to offer a juror money and give her information
that wasn't presented at the trial.

The Youngstown businessman was convicted the next year of
109 felonies in a fraud scheme that prosecutors said cost
investors about $1 billion. The company estimated its
losses at $500 million and sought bankruptcy court
protection.

A Monus friend, Raymond Isaac of Youngstown, has pleaded
guilty to offering a $50,000 bribe to a juror and faces a
possible 10-year prison term. Monus, 50, denied any
knowledge of the offer.
(APWire 6-Mar-1998)


PHELPS TECHNOLOGIES: Emergency Hearing on Auction Sales
-----------------------------------------------------
An emergency hearing has been scheduled on March 9, 1998 in
the Western District of Missouri, Western Division, in the
case of Phelps Technologies, Inc. The hearing will consider
the Debtors' motion granting authority to sell assets at
auction and approving assumption and assignment of
executory contracts and unexpired Leases. The Debtor
asserted that the expedited hearing was necessary because
of the requirements of the Debtors' post-petition financing
and the potential purchaser of certain of the Debtors'
assets.


PROCTOR & GAMBLE: Vietnam Unit Averts Bankruptcy
------------------------------------------------
US consumer-product giant Procter and Gamble said Thursday
it had clinched an 11th-hour deal with its Vietnamese
partner, saving their troubled joint venture from the brink
of bankruptcy.

The agreement, which will see P&G increase its stake in the
joint venture from 70 to 93 percent, brings to an end a
long and bitter struggle that was closely watched by
foreign investors.

"We are pleased both our partners have found a solution
that is consistent with Procter and Gamble's global
strategies and will enable P&G to continue operating in
Vietnam," said Alan Hed, the company's general manager in
Vietnam.

The deal would involve a new equity injection of more than
40 million dollars by P&G.
(Agence France-Presse 5-Mar-1998)


SA TELECOMMUNICATIONS: Greyrock Files Objections
------------------------------------------------
Greyrock Business Credit objects to a motion by SA
Telecommunications, Inc. for an order authorizing the sale
of substantially all assets of the Debtors, approving a
purchase agreement and an escrow agreement, and approving
the assumption and assignment of certain executory
contracts and unexpired leases in connection with the sale
of Debtors' assets. As of the petition date, the Debtors
owed Greyrock $4.3 million plus interest and fees. Under
the Credit Documents, the Debtors granted to Greyrock a
security interest in substantially all of the Debtors'
assets.

Greyrock asserts that Debtors' purchase agreement with
EqualNet Corporation for the sale of Debtors' assets is
insufficient to repay Greyrock, pre- and postpetition.
EqualNet subsequently cancelled the agreement on January
30, 1998.

Therefore, Greyrock requests that any order entered
approving a sale of Debtors' assets must include a
provision directing the Debtors to apply all cash proceeds
from such sale first to the Greyrock DIP.


TELE-COMMUNICATIONS: Will File Bankruptcy Due to Lawsuit
--------------------------------------------------------
Tele-Communications Inc. would pay $10 million, plus $2.5
million in legal fees, to settle a bitter lawsuit brought
by Interactive Network Inc., a California technology firm,
under a settlement proposal made in court this week.

David Lockton, the chairman and CEO of Interactive Network,
alleged in a 1995 lawsuit that TCI, the nation's largest
cable-TV company and a major backer of Interactive Network,
tried to drive the company into bankruptcy to gain control
of its patents. Lockton consistently said he wanted the
case to go before a jury, which might have included TCI
subscribers. Three fellow Interactive Network board
members, however, recently agreed to a settlement of the
case, overruling Lockton.

TCI will pay $10 million to Interactive Network and $2.5
million to Cotchett, Pitre & Simon, the Bay Area law firm
representing Interactive Network, according to an
Interactive Network statement released by Lockton.

The lawsuit alleged that TCI abandoned Interactive Network
and blocked financing plans at a critical time, while
backing a competitive interactive service in Denver named
Zing, which later went bankrupt. TCI denied the Interactive
Network charges and countersued. TCI's countersuit will
also be dropped as part of the settlement.

The company plans to file a voluntary bankruptcy proceeding
and reorganize. TCI, NBC, Sprint and Motorola will forego
collecting on millions in dollars of loans made to
Interactive Network, and will convert that debt to common
stock at a maximum price of $5 per share. A retired federal
judge in San Francisco, Charles B. Renfrew, will oversee
the settlement.
(Denver Post 28-Feb-1998)


TRUSTED HEALTH: Files Chapter 7 After Judgment
----------------------------------------------
Trusted Health Resources, Inc. has filed Chapter 7 after a
$26.6 million judgment was handed down charging the company
had hired a six-time convicted felon as a home-health aide.
It is the largest personal injury verdict in Massachusetts
history, according to Attorney Timothy G. Lynch of Robins,
Kaplan, Miller & Ciresi, LLP. Lynch represented the estate
of John Ward, a 32-year-old quadriplegic with cerebral
palsy, who was beaten and stabbed to death along with his
grandmother, Alba Pellegrini, in their Dorchester, Mass.
home in 1991 by Jesse L. Rogers, a six-time convicted felon
hired by defendant Trusted Health Resources, Inc. to take
care of Ward.

The judgment against Trusted Health and the Visiting Nurse
Association of Boston, which retained Trusted Health, was
awarded by a jury in Suffolk Superior Court on Wednesday,
Feb. 25, 1998. It was the largest negligent security
verdict ever in the U.S. Trusted Health filed for
bankruptcy under Chapter 7 and VNA of Boston reached a
settlement with the Ward estate on Friday, Feb. 27, 1998.
As a condition of the settlement, neither party can discuss
the amount agreed upon.



                   *********

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