Mid Cap
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June 27, 2024
Purdue Ruling Reshapes Conn. Catholic Diocese's Ch. 11 Plan
The U.S. Supreme Court's decision Thursday banning bankruptcy judges from forcing non-debtor third parties to release claims against other non-debtors quickly reshaped a proposed Chapter 11 plan for a Connecticut Roman Catholic diocese, as a creditors committee withdrew a $32 million abuse victim trust proposal and proffered an immediate replacement.
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June 27, 2024
Kavanaugh Rips 'Ruinous' Decision To Kill 3rd Party Releases
In a fiery dissent to the U.S. Supreme Court's split ruling Thursday that eviscerated Purdue Pharma LP's reorganization plan and, along with it, nonconsensual third-party releases in Chapter 11 cases, Justice Brett M. Kavanaugh became the champion of the bankruptcy system, defending its practicality — especially in mass tort cases.
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June 27, 2024
Ch. 7 Can't Free PE Firm From Suit, Diamond Polisher Says
A Canadian diamond polisher urged a Michigan federal judge to keep alive its suit alleging that a lab-grown diamond company's private equity owner knew it couldn't make good on its promise to fund new facilities to process the gemstones, saying the fact that the company is going through bankruptcy can't shield the PE firm from liability for using its alter ego to make fraudulent statements.
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June 27, 2024
Sandy Hook Families Can't Seize Funds From Alex Jones' Co.
A group of families looking to collect a $50 million defamation verdict against Alex Jones' media business can't seize its bank accounts, a Texas bankruptcy judge ruled Thursday, questioning why they asked a state court for control of the accounts hours after the bankruptcy court ordered a Chapter 7 trustee to take over the assets.
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June 27, 2024
Titanic Purdue Ruling Shifts The Balance Of Power In Ch. 11
The U.S. Supreme Court's decision to strike down the Sackler family's liability shield in the Chapter 11 plan of Purdue Pharma LP not only eliminates a key tool to resolve mass tort liabilities through bankruptcy, it gives claimants more leverage and fundamentally changes the insolvency landscape in future cases, experts tell Law360.
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June 27, 2024
Justices Nix 3rd-Party Liability Releases In Purdue Ch. 11 Plan
The U.S. Supreme Court shot down the validity of nonconsensual third-party releases in an opinion issued Thursday in the case of bankrupt drugmaker Purdue Pharma LP, potentially exposing the Sackler family members who own the company to personal liability for the company's role in the opioid crisis.
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June 26, 2024
Eiger Gets OK On Ch. 11 Drug Sale After Tripling Initial Bid
A Texas bankruptcy judge on Wednesday approved Eiger BioPharmaceuticals' $35.1 million sale of its Avexitide product, after the drug company more than tripled an initial bid for the metabolic-disease treatment during a recent auction.
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June 26, 2024
Commitment Issues Raise Questions On Biotech's DIP Loan
Synthetic biologics maker Solar Biotech Inc.'s proposed Chapter 11 loan hit a roadblock Wednesday when a Delaware bankruptcy judge balked at approving the financing package without a firm commitment from the lender, who is also serving as a stalking horse bidder for the debtor's assets.
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June 26, 2024
Cleaning Products Co. Supply Source Cancels Ch. 11 Auction
Cleaning products company Supply Source Enterprises Inc. told the Delaware bankruptcy court it wouldn't go through with a planned auction of all its assets because only its stalking horse bidder made a satisfactory offer.
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June 26, 2024
Small Biz Ch. 11s Soared Before Sub V Liability Limit Lapsed
U.S. bankruptcies under Subchapter V of Chapter 11 surged to a single-day record last week, as small businesses including packaged waffle maker Julian's Recipe rushed to file before the expiration of a key provision that would have made some of them ineligible.
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June 26, 2024
Sleep Tech Co. ProSomnus Can Seek Votes For Ch. 11 Plan
ProSomnus, a developer of devices aimed at preventing sleep apnea, can solicit its creditors' votes on the company's Chapter 11 plan after it made revisions responding to objections raised by the U.S. Trustee's Office, a Delaware bankruptcy judge said Wednesday.
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June 26, 2024
Tech Co. GigaMonster Seeks Vote For Ch. 11 Wind-Down Plan
Defunct internet service provider GigaMonster asked for the Delaware bankruptcy court's sign-off to send its Chapter 11 liquidation and wind-down plan out for a vote by creditors, following a settlement in which the company's unsecured creditors agreed to drop a lawsuit against its controlling investors.
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June 26, 2024
Pricey Chapter 11 Process Fuels Rise In Prepack Filings
Companies that go bankrupt are increasingly opting to first negotiate restructuring deals out of court so they can enter Chapter 11 toting a turnaround plan already accepted by creditors, saving potentially hundreds of thousands of dollars in legal costs and dodging some of the stigma that bankruptcy attracts.
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June 26, 2024
Calif. Atty Won't Contest Claim He Stole Up To $282M
A California lawyer has stopped defending himself against bar discipline charges that accuse him of stealing as much as $282 million from clients, and his posture has forced the cancelation of a trial that was scheduled for this week and makes his disbarment almost certain.
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June 26, 2024
Pharma Co. PhaseBio Can Exit Ch. 11 With Wind-Down Plan
A Delaware bankruptcy judge on Wednesday gave her blessing for pharmaceutical developer PhaseBio Pharmaceuticals Inc. to liquidate its assets and wind down after settlement agreements with creditors and a business partner cleared a path for it to exit Chapter 11 after roughly 19 months.
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June 26, 2024
Ex-BHS Director Ordered To Pay £50M Over Firm's Collapse
A London judge has ordered a former director of the now-defunct British Home Stores to pay £50 million ($63.2 million) in damages after concluding he had committed trading misfeasance and wrongful trading during the company's high-profile downfall.
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June 26, 2024
Mountain Sports Asks Ch. 11 Court For OK On Inventory Sale
Outdoor clothing and sporting goods business Mountain Sports LLC asked a Delaware bankruptcy judge to approve inventory sales by two retail chains the company owns as part of its Chapter 11 case.
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June 25, 2024
2 Federal Judges Stall Biden's Student Loan Debt Relief
Federal judges in Kansas and Missouri on Monday partially blocked the Biden administration from implementing its latest student debt relief program, with both finding that Congress did not give clear authorization through the Higher Education Act for the loan forgiveness plan, as argued by the federal government.
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June 25, 2024
Cigna Objects To Ch. 11 Sale Of Western Pa. Nursing Homes
Cigna Health and Life Insurance Co. filed an objection in Pennsylvania bankruptcy court to the proposed sale of a group of Pittsburgh-area nursing homes, seeking assurances that it will be warned if the nursing homes intend to leave behind their contracts with Cigna as part of the sale.
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June 25, 2024
Texas Appeals Court Reverses Dallas Transit Contractor's Win
A Texas appeals court has revived a subcontractor's lawsuit against a company that oversees the Dallas Area Rapid Transit Authority's services for people with disabilities, saying this week the subcontractor's allegations were strong enough to withstand a motion to dismiss.
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June 25, 2024
Chancery Tentatively OKs $15.5M Lordstown SPAC Suit Deal
A $15.5 million class settlement for a stockholder suit that challenged the special-purpose acquisition company deal that took Lordstown Motors Inc. public won tentative Delaware Court of Chancery approval Tuesday, conditioned on confirmation of one expense claim.
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June 25, 2024
The Future Of AI May Lead Straight To Bankruptcy Court
As interest in artificial intelligence mounts, so do the number of bankruptcies for AI-linked companies, a trend that may be the "tip of the iceberg" as familiar tech-bubble hype yields to the need to turn a profit, experts told Law360.
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June 25, 2024
Bankruptcy Vet Joins Saxton & Stump As Practice Chair
Saxton & Stump LLC announced Tuesday that an attorney with over 35 years of experience working with banks and other corporate entities has become a shareholder and chair of the firm's bankruptcy and financial restructuring group.
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June 25, 2024
AI Video Startup StoryFile Gets OK For Ch. 11 Loan
Artificial intelligence video company StoryFile on Tuesday got final approval from a New York bankruptcy judge to take out a $900,000 loan to fund its bankruptcy case.
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June 24, 2024
Ch. 11 Fee Cases Remanded After 'Very Practical' Decision
Now that the U.S. Supreme Court has decided refunds aren't owed to debtors who overpaid the U.S. Trustee's Office under a previous fee structure, it sent three similar cases that were pending before it back to the lower courts to give them a crack at applying the ruling.