Talks were continuing today over the sale of textile giant Burlington Industries after a bankruptcy judge rejected a $6 million break-up fee that formed part of the bid by WL Ross Inc LLC.

Judge Randall Newsome ruled yesterday that Ross will not collect the fee if the firm's reorganisation plan is rejected and its bid to buy the North Carolina-based company fails.

He also said Ross could buy the company for $614m instead of the $620.1m bid already on the table but did not immediately arrange a date for a new hearing to resolve the issues.

Ross attorney Lewis Kruger told Newsome the ruling "could be a problem," the News & Record reported.

Burlington filed for Chapter 11 in late 2001 citing liabilities of $1.1 billion.

It has since cut more than 6,000 jobs and is expected to emerge from bankruptcy protection before the end of this year.