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Bankruptcy
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March 06, 2024
Yellow Corp. Faces Pension Funds' Arbitration Bid In $6B Spat
Eleven retirement funds urged a Delaware bankruptcy judge Wednesday to order Yellow Corp. to arbitrate their claims worth over $6 billion, arguing it would be efficient to take the dispute before a benefits plan expert, while the trucking firm insisted that arbitration would delay its ongoing Chapter 11 proceedings.
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March 06, 2024
SVB Parent Co. Sues Receivers Over $1.9B In Withheld Funds
Silicon Valley Bank's former parent company has sued the Federal Deposit Insurance Corp. in its capacity as receiver for its defunct subsidiary and Silicon Valley Bridge Bank in California federal court, alleging it was wrongfully denied its administrative claims to recover approximately $1.9 billion in account funds and other deposit claims.
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March 06, 2024
BlockFi, FTX Strike Global Deal To Settle Bankruptcy Disputes
Fallen cryptocurrency giants BlockFi Inc. and FTX have settled their wide-ranging feud, with BlockFi allowed claims for $874.5 million and FTX to lay claim to roughly $600 million worth of liquidated Robinhood shares, formally ending all disputes and litigation between the two companies.
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March 06, 2024
11th Circ. Told IRA Account Isn't Exempt From $1.6M Ruling
An attorney representing a group of creditors told the Eleventh Circuit on Wednesday that the individual retirement account belonging to a medical doctor-turned-developer isn't exempt from a $1.6 million judgment related to fraud, saying the Florida federal bankruptcy court ignored a ruling made in an Alabama state court.
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March 06, 2024
Del. Judge Asks If Byju's Ch. 11 Clawback Bid Is A Legal Claim
A Delaware bankruptcy judge asked for more briefing on a temporary restraining order demand by the U.S. arm of Indian tech giant Byju's Wednesday, saying he wasn't sure he had the authority to issue such an order in the debtor's $533 million clawback action because Byju's is seeking the return of cash assets.
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March 06, 2024
Judge Rejects Equity Challenge To Virgin Orbit Ch. 11
A Delaware bankruptcy judge on Wednesday told Virgin Orbit LLC shareholders that she wouldn't retract confirmation of the satellite launch company's Chapter 11 liquidation plan, because Virgin Orbit appropriately sought approval even if the scheme left equity holders without hope of recoveries.
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March 06, 2024
Kwok Trustee Asks For Ch. 11 Pause During NY Criminal Trial
The Chapter 11 trustee overseeing the $374 million case of Chinese exile Ho Wan Kwok has urged a Connecticut bankruptcy judge to pause a racketeering suit and roughly 270 avoidance actions, saying the stay would lighten the court's administrative burden while also allowing Kwok to face trial in New York.
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March 06, 2024
Genesis Parent Co. Says NY Fraud Suit Is 'Baseless Innuendo'
Crypto conglomerate Digital Currency Group Inc. and its CEO told a New York trial court on Wednesday that the state attorney general's claims that it defrauded customers out of more than $3 billion are "a thin web of baseless innuendo, blatant mischaracterizations and unsupported conclusory statements" that should be permanently tossed.
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March 06, 2024
'Joker' Producer Accused Of Funding Films Via Ponzi Scheme
Movie producer Jason Cloth and a Chicago-area investment brokerage are facing an $80 million proposed class action that was recently leveled in Illinois state court by an investor who says the filmmaker has mishandled money he's pulled in for several projects and raised new funds to pay older investors.
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March 06, 2024
Sewer Deal Kept On Ice During Appeal In Philly Suburb's Ch. 9
A Philadelphia bankruptcy judge Wednesday rejected a utility's latest effort to lift the automatic stay triggered by the City of Chester's Chapter 9 bankruptcy, which has delayed a $276.5 million sewer sale, saying it would require her to answer questions that are on appeal from a similar motion she nixed last year.
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March 06, 2024
Otterbourg Formalizes Bankruptcy, Mass Torts Practice Group
As many BigLaw firms continue chasing bankruptcy talent, Otterbourg PC announced the formalization of a cross-departmental mass tort bankruptcy practice group under the leadership of a recently hired restructuring attorney and a longtime Otterbourg litigator.
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March 06, 2024
Gemini Scores Arbitration Bid In 'Earn' Crypto Investment Suit
Gemini Trust Co. LLC investors must arbitrate their claims that the cryptocurrency exchange misled them about the firm's interest-bearing accounts and were hurt after the program for the accounts was halted, with a New York federal judge finding that Gemini and its founders have shown that a valid arbitration agreement exists.
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March 06, 2024
Rite Aid Aims To Divest Most Of Its Health Dialog Business
Bankrupt drugstore chain Rite Aid Corp. said Wednesday that it will sell most of its Health Dialog business, which provides personalized health services, to Carenet Health for an undisclosed amount.
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March 06, 2024
Bankruptcy Group Of The Year: Sullivan & Cromwell
Sullivan & Cromwell LLP's bankruptcy practice handled the sprawling bankruptcy of cryptocurrency exchange FTX and the Chapter 11 proceedings of Kidde-Fenwal, the first bankruptcy resulting from PFAS-related product liability, earning it a spot among Law360's Bankruptcy Groups of the Year.
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March 06, 2024
Ex-Stimwave CEO Found Guilty Of Healthcare Fraud
A New York federal jury on Wednesday convicted the former CEO of Stimwave over allegations that the medical device maker sold an implant for chronic pain sufferers with a bogus component in order to drive up billings.
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March 06, 2024
BowFlex Gets OK For $25M DIP, Plans On April Sale
A New Jersey bankruptcy judge on Wednesday gave BowFlex permission to draw on $25 million in Chapter 11 financing as the exercise equipment company heads for what it said will be an April asset sale.
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March 05, 2024
Lordstown Ch. 11 Plan Confirmed After Settlements Reached
A Delaware bankruptcy judge confirmed the Chapter 11 plan of electric vehicle maker Lordstown Motors Corp. over the objection of the Office of the U.S. Trustee after finding that the debtor is eligible for a discharge of its liabilities.
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March 05, 2024
Terraform Says Creditors Sabotaging Dentons Retention
A Delaware bankruptcy judge on Tuesday allowed Terraform Labs unsecured creditors time to catch up on a dispute over the debtor's Denton's retention, a request Terraform dubbed "sabotage" of its defense in an upcoming $40 billion securities fraud trial.
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March 05, 2024
IPwe Seeks Ch. 7 Liquidation After Ch. 11 Financing Loss
Patent trading platform operator IPwe asked a Delaware bankruptcy judge Tuesday to convert its Chapter 11 reorganization to a Chapter 7 liquidation, saying it has lost its source of bankruptcy funding and has no way to continue with its planned going-concern sale.
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March 05, 2024
Robertshaw's Ch. 11 Sale Plan Panned As 'Blatant Favoritism'
Asset manager Invesco asked a Texas bankruptcy judge to block appliance parts maker Robertshaw US Holding Corp.'s proposed bidding procedures for a Chapter 11 sale, calling the debtors' agreement with a lender group and its equity sponsor "blatant favoritism."
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March 05, 2024
EV Maker Proterra's Ch. 11 Plan Gets Thumbs-Up In Del.
A Delaware bankruptcy judge on Tuesday approved the reorganization plan of commercial electric vehicle technology company Proterra, which entered Chapter 11 to overhaul nearly $200 million in funded debt, overruling a handful of remaining objections.
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March 05, 2024
WeWork Seeks 4 More Months Of Ch. 11 Exclusivity
WeWork asked a New Jersey bankruptcy judge to extend the window during which only the coworking space company can propose a Chapter 11 reorganization plan by 120 days, saying the extra time would avoid disruptions to its progress.
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March 05, 2024
Rite Aid Process To Break Leases, Close Stores In Ch. 11 OK'd
A New Jersey bankruptcy judge on Tuesday signed off on procedures for bankrupt retail pharmacy chain Rite Aid Corp. to potentially shutter 210 rented stores with fast-approaching lease rejection deadlines, overruling objections from two landlords.
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March 05, 2024
NC Panel Says Co. Can't Intervene In Insurer Liquidation
A holding company owned by insurance mogul Greg Lindberg shouldn't have been allowed to intervene in the North Carolina insurance commissioner's liquidation of two insolvent insurers, a state appeals court held Tuesday, saying only a company's directors are permitted to do so under state law.
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March 05, 2024
Voyager Creditors Have Left $19M Of Checks Uncashed
The wind-down administrator for defunct cryptocurrency brokerage Voyager Digital Holdings Inc. has told a New York bankruptcy judge that $19 million worth of checks sent to creditors were still unclaimed, setting an April 20 deadline to cash the checks or lose out on recovery for good.
Expert Analysis
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Ghosting In BigLaw: How To Come Back From Lack Of Feedback
Junior associates can feel powerless when senior colleagues cut off contact instead of providing useful feedback, but young attorneys can get back on track by focusing on practical professional development and reexamining their career priorities, says Rachel Patterson at Orrick.
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The Redemption Of 'Too Big To Fail' After SVB Collapse
With many depositors moving their money to banks deemed "too big to fail" in the wake of the recent failure of Silicon Valley Bank, a term seen as a stigma after the Great Recession has become a sign of stability — but granting some banks too-big-to-fail status, and not others, comes with risks, says Christine Docherty at Goodwin.
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Texas Bankruptcy Ruling May Create Uncertainty For Sureties
A Texas federal court’s recent ruling in Markel Insurance v. Origin Bancorp casts uncertainty on the utility of commonly used contractual trust language, and highlights that sureties should not be put to the task of negotiating intercreditor agreements to protect their rights, says Lisa Tancredi at Womble Bond.
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Steps To Success For Senior Associates
Excerpt from Practical Guidance
Adriana Paris at Rissman Barrett discusses the increased responsibilities and opportunities that becoming a senior associate brings and what attorneys in this role should prioritize to flourish in this stressful but rewarding next level in their careers.
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Opinion
SEC Crypto Settlements Run Contrary To Public Interest
Cryptocurrency stakeholders await a Southern District of New York ruling poised to break the harmful trend of U.S. Securities and Exchange Commission no-admit, no-deny settlements, which come at the expense of the public interest and have the potential to create catastrophic consequences in the crypto space, say Samidh Guha, Sophia Weinstock Kielar and David Rosa at Guha.
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Georgia-Pacific Ruling Furthers Texas Two-Step Challenges
With its recent ruling in the case of Bestwall, barring asbestos injury litigation against nondebtor Georgia-Pacific, the Fourth Circuit joins a growing body of courts addressing the Texas Two-Step's legality, fueled by concerns over the proper use of bankruptcy as a tool for addressing such claims, says George Singer at Holland & Hart.
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Legal Profession Must Do More For Lawyers With Disabilities
At the start of Disability Pride month, Rosalyn Richter at Arnold & Porter looks at why lawyers with disabilities are significantly underrepresented in private practice, asserting that law firms and other employers must do more to conquer the implicit bias that deters attorneys from seeking accommodations.
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Opinion
Appellate Funding Disclosure: No Mandate Is Right Choice
The Advisory Committee on Appellate Rules' recent decision, forgoing a mandatory disclosure rule for litigation funding in federal appeals, is prudent, as third-party funding is only involved in a minuscule number of federal cases, and courts have ample authority to obtain funding information if necessary, says Stewart Ackerly at Statera Capital.
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Avoiding Negative Tax Consequences In Loan Modifications
Borrowers who may be caught in the dramatic uptick in nonperforming commercial real estate loans should consider strategies to avoid income and capital gains tax that may be triggered by loan modifications, says Aman Badyal at Glaser Weil.
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How Attys Can Avoid Exposing Their Firms To Cyberattacks
Attorneys are the weakest link in their firms' cyberdefenses because hackers often exploit the gap between individuals’ work and personal cybersecurity habits, but there are some steps lawyers can take to reduce the risks they create for their employers, say Mark Hurley and Carmine Cicalese at Digital Privacy & Protection.
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What Purdue Ch. 11 Means For Future Of Third-Party Releases
The Second Circuit’s highly anticipated ruling approving Purdue Pharma’s bankruptcy plan establishes stringent factors that lower courts must consider before approving nonconsensual third-party releases, but the circuit split on the matter means the issue is far from resolved, say Gregory Hesse and Kollin Bender at Hunton.
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Virginia 'Rocket Docket' Slowdown Is Likely A Blip
After being the fastest or second-fastest federal civil trial court for 14 straight years, the Eastern District of Virginia has slid to 18th place, but the rocket docket’s statistical tumble doesn't mean the district no longer maintains a speedy civil docket, says Robert Tata at Hunton.
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An Investor's Road Map For Distressed Crypto Assets
For investors treasure hunting for distressed crypto assets, there are three key contexts in which these investments can be made, but there are procedures and potential pitfalls that can make or break success, say attorneys at Mayer Brown.
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5 Management Tips To Keep Law Firm Merger Talks Moving
Many law firm mergers that make solid business sense still fall apart due to the costs and frustrations of inefficient negotiations, but firm managers can increase the chance of success by effectively planning and executing merger discussions, say Lisa Smith and Kristin Stark at Fairfax Associates.
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How Wash. Bankruptcy Amendments Will Aid Debtors
Washington state’s recently updated bankruptcy exemptions — which provide greater protection for debtors’ assets, including cash, vehicles and personal injury proceeds — bring the state up to speed in terms of asset protection, and may result in an increase in Chapter 7 liquidation filings, says Richard Symmes at Symmes Law.