The Fort Lauderdale firm filed for Chapter 11 reorganization in a Fla. federal court, claiming the bankruptcy occurred after the company's former president and only shareholder, James DeRosa, used money earmarked for client use to pay off the company's ongoing losses. JDI Data says DeRosa and the company's former CEO participated in a Ponzi-type scheme to convert the clients' funds to personal funds without the client's knowledge. The firm is surrendering its leased office at 100 W. Cypress Creek Road and has not determined if it will re-open a physical location.
The developer of Banyan Cay Resort in West Palm Beach filed for bankruptcy after facing foreclosure actions from two lenders that seek to recoup $100.4 million. Banyan Cay's parent company submitted its Chapter 11 petition the same day Calmwater Capital won a final judgment for $94.1 million against the development entity, Banyan Cay Resort & Golf, in Palm Beach County Circuit Court. That judgment is tied to an unpaid $61 million construction loan for Banyan Cay. The Banyan Cay Resort Fund is also after a repayment of a $6.3 million messanine loan. Both parties are seeking to acquire an unfinished Banyan Cay hotel project in Miami to sell at auction to help recoup money owed.
The company has filed for Chapter 11 bankruptcy protection for the second time in three years, and secured $51 million in financing to keep its stores open. The company has almost 500 stores, down from about 700 stores in 2020, and it plans to close more. Unpredictable retail spending, which crashed during COVID, is cited as one of the reasons for the bankruptcy filing.
The Third Circuit dismissed the Chapter 11 case of Johnson & Johnson's talc unit that used a controversial "Texas two-step" maneuver, saying the company was not in financial distress and lacked the required good faith to commence its bankruptcy case. The decision reverses rulings from a N.J. bankruptcy judge that allowed the case of LTL Management to proceed as the company tried to deal with billions of dollars in liability related to its talc products, with tens of thousands of claimants alleging it caused deadly diseases including mesothelioma and ovarian cancer. Johnson & Johnson will likely appeal, stating that bankruptcy remains the most fair and efficient way to administer the talc claims.
Ramarama, a Durham real estate developer, has again filed for Chapter 11 bankruptcy protection, listing both assets and liabilities as ranging between $1 million and $10 million. Ramarama's attorney says the company is "committed" to repaying its creditors in a way that maximizes the value of its two building development projects in downtown Durham. Ramarama previously filed for bankruptcy, but it was dismissed with prejudice in 2021 after the company failed to participate in the case. A judge accepted the company's latest filing, but noted that creditors have been harmed by Ramarama's previous bankruptcy filing and unwillingness to participate in the processes necessary for a successful reorganization, and barred Ramarama from refiling any bankruptcy proceeding for one year.
The restructuring process is expected to reduce the company's debt and optimize its capital structure and liquidity. Party City expects to complete the restructuring process in the second quarter of this year. Party City's says its over 800 stores will remain open during the bankruptcy process and it will continue with business as usual. Party City cited pandemic headwinds, a global supply chain crisis and other macroeconomic challenges as the reasons for filing.
Bed Bath & Beyond is preparing to seek bankruptcy protection in coming weeks, following poor sales and an inability to compete with large online and big-box retailers. The retailer is considering skipping debt payments due Feb. 1. The company said it was exploring a range of options to address its plunging sales that included declaring bankruptcy. The retailer said it has not made any final decisions on which course to take.
O'My Foods, which makes O'My Dairy Free Gelato, filed for reorganization in the Eastern District of Virginia. The company listed 50-99 creditors and liabilities between $1 million and $10 million. It listed assets at between $500,000 and $1 million.
Madera Community Hospital, a Madera, Calif.-based healthcare provider with over $200 million in total patient revenue and 106 staffed beds, filed for Chapter 11 bankruptcy and will be permanently closing its doors on Jan. 10, 2023. Madera Community Hospital had previously entered into an agreement with Trinity Health, whereby Trinity would've acquired the struggling hospital. Trinity ultimately decided not to go ahead with the partnership. All patients remaining at the hospital on the closing day will be transferred to other hospitals by Jan. 17, 2023.
An Illinois-based Burger King franchisee put its subsidiaries operating 90 stores in bankruptcy, citing a pandemic-driven revenue decline and increased overhead costs. The Chapter 11 filings submitted by TOMS King Holdings' operating subsidiaries reveal they owe about $35.5 million in secured debt to Bank of America. They owe another $14 million of unsecured debt to certain vendors, landlords and Burger King Corp., according to the filings in the U.S. Bankruptcy Court for the Northern District of Ohio.
Argent Ventures wants to reorganize the finances of the hotel's home, 1601 Broadway, having gained control of the 46-story tower in the heart of Times Square by vanquishing office giant SL Green in court and replacing Vornado Realty Trust. Penson had elbowed his way into the property via the purchase of the $526-million mezzanine debt on which Vornado had defaulted. The 795-room hotel offers 196,300 square feet of office space and 17,800 square feet of retail. The hotel, which occupies floors 15 through 46, closed when COVID arrived, but reopened last month.
Although Aeromexico had successfully emerged from the Chapter 11 process in March 2022, the case was still open. The court closed the case considering, among other things, that Aeromexico's plan of reorganization was substantially consummated. The Mexican carrier first filed for bankruptcy proceedings in June 2020, in the midst of the COVID-19 pandemic.
A group of four FTX customers asked a bankruptcy judge to rule their holdings in the Bahamas-based exchange belong to them, rather than FTX. They want the judge to give customers repayment priority over other FTX creditors, according to a Delaware bankruptcy court filing. The group is also asking to have the suit certified as a class-action case. Authorities accuse the exchange's founder, Sam Bankman-Fried, of fraudulently raising $1.8 billion from investors and using FTX funds to make high-risk bets at his hedge fund, Alameda Research, and cover personal expenses.
More companies backed by PE firms filed for bankruptcy in the U.S. in 2022 compared to the previous year, but the total number of restructurings remained relatively low, according to data from S&P Global Market Intelligence. The tally increased to 49 in 2022 from 42 in 2021. Among the 49 PE portfolio companies that went bankrupt in 2022, the consumer sector accounted for 15 bankruptcies as the most impacted subsector, followed by 11 deals from the healthcare sector.
Davenport Extreme Pools & Spas filed for Chapter 11 bankruptcy protection with the U.S. Bankruptcy Court for the Western District of Kentucky. The company has nearly 100 creditors with an approximate $50,000 in assets and under $50,000 in estimated liabilities.
Keen-Summit Capital Partners confirmed the U.S. Bankruptcy Court for the Western District of Texas, Austin Division, approved bid procedures and an auction related to the approximate $75-million stalking horse contract for the sale of 13 single-story office buildings and one retail strip center in Austin, Tx. The portfolio includes approximately 545,000 square feet of office space and 15,300 square feet of retail. The property owner, WC Braker Portfolio LLC, filed Chapter 11 on May 2, 2022.
3M can't shift responsibility for more than $300 million in damages awarded to veterans over defective combat earplugs to a unit that filed for bankruptcy, a judge ruled. The court sanctioned 3M by ordering it to accept all liability for the faulty ear-protection. The judge said 3M attempted to switch its litigation position in bad faith after almost four years of legal wrangling over more than 230,000 lawsuits involving the products. Analysts say 3M faces more than $7 billion in liabilities over the faulty products. More than a dozen juries have found veterans’ hearing loss was tied to the defective earplugs and ordered the company to pay more than $300 million in damages. 3M also has won six defense verdicts in so-called test trials. 3M said it would appeal the ruling.
Core Scientific is filing for Chapter 11 bankruptcy protection in Texas. The move follows a year of plunging cryptocurrency prices and rising energy prices. Core Scientific mines for proof-of-work cryptocurrencies like bitcoin. The company is still generating positive cashflow, but that cash is not sufficient to repay the financing debt owed on equipment it was leasing. The company won't liquidate, but will continue to operate normally while reaching a deal with senior security noteholders, which hold the bulk of the company's debt.
Voyager Digital selected U.S. exchange BAM Trading Services, d/b/a Binance.US, as the winning bidder for its assets. Binance's bid is valued at approximately $1.022 billion. The company will make a $10-million good faith deposit and will reimburse Voyager for certain expenses up to a maximum of $15 million. Should the deal not close by Apr. 18, 2023, subject to a one-month extension, the agreement allows Voyager to move to return value to customers. Voyager will seek Bankruptcy Court approval to enter into the asset purchase agreement at a hearing on Jan. 5, 2023. The sale to Binance.US will be consummated pursuant to a Chapter 11 plan, which will be subject to a creditor vote and is subject to other customary closing conditions.
The Tides South Beach hotel is headed for a foreclosure auction after the owner lost an $82.2 million judgment. SHEDDF3 VNB, an affiliate of Safe Harbor Equity, won the judgment against CG Tides, CG Tides Village, CG Tides Village I, CG Tides Village II and 1155 Collins, along with guarantor Meyer Chetrit of New York. It was based on $41.8 million in mortgage principal, plus interest and fees starting in 2017, when the default started. The lawsuit concerns the 45-room hotel at 1220 Ocean Drive; the properties at 1201, 1121 and 1225 Collins Ave. with the buildings for the hotel's expansion; and 28,339 square feet in a parking garage at 1155 Collins Ave. All of those properties are scheduled for foreclosure auction on Jan. 17.
Investments SWK LLC submitted its Chapter 11 petition in U.S. Bankruptcy Court in West Palm Beach. The company owns the 46,454-square-foot office building at 351 Cypress Road. In July, Wildstein Investments and 9287-0245 Quebec jointly filed a foreclosure lawsuit against Investments SWK and Wray over a $4.6 million mortgage. The office building was constructed on the 2.4-acre site in 1984.
The owner of the 492-room Holiday Inn in Manhattan's Financial District, an LCC called Golden Seahorse, filed for Chapter 11 protection in a New York bankruptcy court, saying it was facing receivership after defaulting on a $137 million loan thanks to the COVID-19 pandemic. Opened in October 2014 and located two blocks from the World Trade Center, the owner said that while sagging occupancy rates have recovered sufficiently for it to resume loan payments, its loan servicer was granted a court order to appoint a receiver in September. Golden Seahorse aims to secure a payment deal, but a sale is possible if an agreement can't be reached.
Urban Commons filed for Chapter 11 bankruptcy on the hotel portion of the Wagner at the Battery, just weeks after a lender filed a petition to foreclose on the Lower Manhattan asset. In the filing, the company declared $22.9 million in claims against the property, the biggest of which is $13.7 million from the Battery Park City Authority. The agency is Urban Commons' landlord on a ground lease at the site, 2-10 West Street across from Battery Park City. Urban Commons bought the hotel from a JV of Millennium Partners and Westbrook Partners in 2018. The hotel, which forms the base of a 36-story tower, has 298 rooms across 12 floors. Above it are 120 condo units. The hotel closed when the pandemic began in early 2020 and has yet to reopen.
Markam Transport filed for Chapter 11 bankruptcy protection. The company filed for protection with estimated liabilities and assets up to $10 million each, according to a filing in U.S. Bankruptcy Court Eastern District of Michigan. The business, registered to Mark Donatiello, has more than 50 creditors, mostly from Michigan. The largest creditors include Huntington National Bank, owed more than $2 million, and BMO Harris, owed more than $400,000. Markam, incorporated in 2010, reported $3.2 million in sales and $2.8 million in income last year.
Freon Logistics, a Bakersfield-based trucking company, filed for bankruptcy. Documents filed in Eastern District of California U.S. Bankruptcy Court show the company, which provides truckload, less-than-truckload, intermodal, repair and maintenance and warehousing services, is seeking Chapter 11 protection. Freon Logistics employs about 500 people. The bankruptcy filing said the company expects the business to be profitable while the case is underway.
Beleaguered cryptocurrency exchange FTX may have more than 1 million creditors, according to a new bankruptcy filing, hinting at the huge impact of its collapse on crypto traders. When it initially filed for Chapter 11 bankruptcy protection, FTX indicated that it had more than 100,000 creditors with claims in the case but in an updated filing, lawyers for the company said there could be more than one million creditors.
Beleaguered cryptocurrency platform FTX filed for bankruptcy protection and CEO Sam Bankman-Fried resigned. FTX and a bevy of affiliates said they had more than 100,000 creditors and tens of billions of dollars in assets and liabilities. It marks the largest crypto-related bankruptcy ever, and a demise remarkable for its swiftness as well as its size. In January, FTX raised money from Silicon Valley's most sophisticated investors, at a valuation of $32 billion, but the bankruptcy will likely wipe out billions of equity value, leaving investors including Sequoia Capital and Thoma Bravo with stiff losses.
Fast Radius filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code in the District of Delaware. The company requested the court establish certain sale and marketing procedures, which include a proposed bid deadline of Dec. 5, 2022. The company said it's in active discussions with one or more potential partners and continues to explore and evaluate strategic alternatives. Fast Radius filed customary motions requesting that the court authorize the company's ability to use cash on hand and operating cash flows to support its continued operation throughout this process, including payment of employee wages and benefits without interruption.
Borrego Community Health Foundation filed for Chapter 11 bankruptcy protection in the U.S. Southern District of California. Borrego Health claims assets of approximately $50-100 million, and liabilities in the same amount. Unlike typical subcontracted dental care from FQHCs, these uniquely constructed agreements by Borrego Health paid private dental providers on an encounter fee basis, and not via a fee-for-service methodology. As such, without intensive oversight by Borrego Health's chief dental officer, Dr. Timothy S. Martinez, and his subordinate staff, fraud and abuses were seemingly encouraged. The FBI subsequently raided Borrego Health and its retained billing contractor, Premier Healthcare Management.
Movie theater chain Cineworld Group announced a bankruptcy settlement with its landlords and lenders, clearing the way for the company to borrow an additional $150 million and make a $1 billion debt repayment. Landlords and junior creditors dropped their opposition to the billion-dollar debt repayment after Cineworld agreed to pay at least $20 million in rent that will accrue after Sept. 30. Britain's Cineworld, which filed for bankruptcy protection in Texas with less than $4 million in cash on hand, previously did not intend to make any post-September rent payments until the end of its bankruptcy. Cineworld also agreed to explore a potential sale of the business and allow creditor input on its business plan.
Obstetric and Gynecologic Associates of Iowa City and Coralville PC filed for Chapter 11 protection in an Iowa federal bankruptcy court in the face of a record $97.4 million malpractice verdict for its involvement in a 2018 delivery that left an infant with brain injuries. The clinic cited the malpractice judgment as its primary liability, and according to the Chapter 11 petition, the clinic has less than $1 million in assets.
A Delaware judge approved the Chapter 11 plan after a brief hearing on an updated plan enabled in part by an earlier sale of the business to Southerland Page for $70.6 million plus assumption of specified liabilities. The company, which was founded in 1972, sought protection after years of debt restructuring efforts. EYP Group Holdings says it suffered a series of defaults, litigation and workout efforts that left the business shackled with high-interest debt, depleted by lender sweeps of its cash. Under the plan, sale proceeds will be distributed to creditors with agreements reached on assumption of liabilities by Southerland Page and "narrow" claims retained by a litigation trust established as part of the plan.
Online lender Kabbage asked a Delaware bankruptcy judge to approve a nearly $58 million settlement of its disputes with Customers Bank stemming from their participation in the federal Paycheck Protection Program. Under the terms of the deal filed with the court, Customers Bank will pay Kabbage $23 million and give up on nearly $35 million in claims for payments withheld by Kabbage during their dispute over the processing of PPP loans last year. Kabbage operated an online small-business lending platform before selling the majority of its business to affiliates of American Express in October 2020. It filed for bankruptcy Oct. 3, saying it made the move in the face of the cost of dealing with disputes related to its $7 billion in PPP loans to small businesses affected by the COVID-19 pandemic.
Global Processing, a non-GMO soybean processing company in Kanawha, Iowa, filed for Chapter 11 bankruptcy. The company has been in business since 2019, but the Idaho Department of Agriculture and Land Stewardship suspended its grain dealer and warehouse licenses due to the company's failure to have sufficient funds to cover producer grain checks as well as its failure to file required monthly financial statements. According to the bankruptcy filing, the company owes between $10 million and $50 million to between 100 and 199 creditors, some of which include Archer Daniels Midland, BNSF Railway Company, Farm Credit Services of America, Midwest Soya International, Union Pacific Railroad and Hansen-Mueller.
Revlon's attorneys said the cosmetics company is engaging with possible purchasers as a way to exit from Chapter 11 as quickly as possible. Revlon is exploring a possible sale of the company and has begun sending nondisclosure agreements to interested bidders. Revlon junior creditors argued in court that rushing toward a sale before the 2022 holiday season would only benefit senior lenders who forced the company to accept unrealistic deadlines as part of Revlon's $1.4 billion bankruptcy loan. That court-approved loan requires Revlon and its lenders to reach a bankruptcy restructuring agreement by mid-November, which doesn't leave enough time for stakeholders to review Revlon's new business plan or offer a realistic path for rehabilitating the company, according to a lawyer for the junior creditors.
Bankrupt Texas petrochemical producer TPC Group announced a $30-million settlement with junior creditors, including people with injury and property damage claims related to a 2019 fire explosion and fire at a Port Neches, Texas, refinery. The firm filed a prepackaged Chapter 11 case in June after reaching an agreement with bondholders to eliminate $950 million of $1.3 billion in secured debt and shed liabilities from an explosion and fire at its plant in Port Neches, Texas. A bankruptcy plan based on that agreement would have left just $5 million for junior creditors and litigation claimants. The settlement increases junior creditors' recovery to $30 million and ensures that a higher percentage of those funds will go to litigation claimants. Bondholders, who will not be fully repaid in TPC's restructuring, agreed not to collect any money from the $30 million fund.
A Kimberly-Clark affiliate that distributed tainted hand sanitizer products received approval for its Chapter 11 plan after amending the documents to reflect agreement with state and federal environmental regulators on the destruction of the poisonous stock. U.S. Bankruptcy Judge David R. Jones said he was concerned about the ability of 4E Brands Northamerica LLC to comply with regulations about the planned destruction of methanol-tainted sanitizer if it moves forward with its selected contractor for the storage and incineration of the products. Regulators with the Texas Commission on Environmental Quality objected to the debtor's choice of disposal company, saying hand sanitizer Latitude Liquids had been ordered to shut down its operations after an investigation revealed several violations of safety protocols, including the existence of a pit at its Shamrock, Texas, facility, indicating a possible intent to improperly dispose of the tainted products. 4E Brands' chief restructuring officer David M. Dunn told the court about 4,500 pallets of poisonous sanitizer products have been consolidated at Latitude's Shamrock site, with another 1,500 pallets at other Texas facilities slated to be transported there in the coming weeks. After some discussions among the parties, the plan was amended to include a pledge that neither 4E Brands nor Dunn will abandon the sanitizer products and that if no acceptable plan has been provided by Latitude by 45 days after the Chapter 11 plan becomes effective, then Dunn will switch to a new service provider.
Two companies that were warned by the U.S. Food and Drug Administration about unsound manufacturing practices petitioned for Chapter 11 bankruptcy reorganization. The majority owner and president of Ultra Seal Corporation of New Paltz and Ultra-Tab Laboratories Inc. states in an affidavit that the company's practices "did not meet industry standards or FDA expectations." In 2018, the FDA cited Ultra Seal for inadequate equipment cleaning procedures and other violations, and in 2020, Ultra-Tab was cited for similar violations.
A Delaware bankruptcy judge said she will approve the $28 million sale of health and wellness product distributor NewAge Inc. The company, which distributes lines of health, wellness and beauty products through a worldwide multilevel marketing network, filed for Chapter 11 protection in August with $149 million in debt. The company said it had reached an agreement with longtime independent sales associate John Wadsworth, under which Wadsworth provides $16 million in debtor-in-possession financing and puts up that and the $12 million in secured debt he purchased just before the bankruptcy as a stalking horse credit bid for NewAge's assets. Last month, objections by the unsecured creditor's committee to the proposed auction were resolved by Wadsworth's pledge to provide up to $1.5 million to pay unsecured claims.
A combination of legal damages, a failed distribution deal and stagnant sales overwhelmed Miami-based energy-drink maker Bang. Court papers filed in Florida revealed Bang's parent company, Vital Pharmaceuticals, owes more than $500 million to its arch-rival, Monster Beverage Co., and a small California juice maker. It owes another $115 million to PepsiCo, its old distributor. Vital listed total assets and liabilities of as much as $1 billion each in its bankruptcy petition.
Michigan auto supplier Instaset Plastics is seeking Chapter 11 protection in U.S. Bankruptcy Court in Detroit in a bid to stay afloat long enough to be sold to an injection molding company. The bankruptcy filing is the result of a half-dozen years of financial issues for the company, which supplies plastic parts, such as interior door handles, for automakers such as GM and Ford. The company now is hoping to secure another loan from a creditor to keep operations going until it's taken over by Holland, Mich.-based Clarion Technologies. According to the filing, Instaset's assets total $1.3 million, with just $9,974 cash on hand. It owes Huntington Bank $557,311, and owes WGS $692,745.
Online lender Kabbage filed a Chapter 11 liquidation plan in Delaware bankruptcy court, saying it made the move in the face of the cost of dealing with disputes stemming from its $7 billion in Paycheck Protection Program loans. Kabbage, which does business as KServicing, said it's involved in multiple government investigations and stakeholder disputes stemming from its involvement in the PPP that are interfering with its ability to manage its remaining loan portfolio and wind down its business after the sale of most of its assets to affiliates of American Express in 2020. In October 2020, AmEx acquired the majority of Kabbage, which operated an online small business lending platform. It currently exists to service the $1.3 billion in outstanding PPP loans and $17 million in outstanding small business loans not included in the deal. In its filings, the company said it currently owes the federal government $541 million that was advanced to make PPP loans. The company previously stated it had facilitated more than $7 billion in PPP loans to almost 300,000 businesses, saving an estimated 945,000 jobs. In 2020, it became the second largest PPP lender in the country.
Unsecured creditors of hand sanitizer distributor 4E Brands Northamerica LLC objected to the company's proposed Chapter 11 plan, telling a Texas bankruptcy court the plan would give up potentially valuable claims against the debtor's parent company without sufficient consideration in return. In its objection, the official committee of unsecured creditors said it wasn't invited to participate in plan discussions with the debtor and its parent, 4E Global SAPI de CV - a Mexican affiliate of Kimberly-Clark - and the proposal that resulted doesn't seek to serve the interests of creditors and personal injury claimants. The claims against the parents, which the committee argues are being given up for a "pittance," arise from 4E Global's manufacture of hand sanitizer products tainted with poisonous methanol acquired from unscrupulous suppliers during the height of the COVID-19 pandemic. 4E Brands is an entity whose operations were focused on helping to import the products made by 4E Global into the U.S. The debtor instituted a voluntary recall of its products, but the committee argues that hundreds of people were injured by the tainted sanitizer and that at least four people may have died as a result of exposure to it. According to the plan disclosure statement, the settlement includes forgiveness of the 4E Global-provided DIP loan and $23.5 million in intercompany transfers along with the full payment of costs associated with destroying the contaminated sanitizer, with a minimum payment of $2.2 million. The parent company also pledged up to $2.1 million to pay other claims and wind down costs.
Dynamic Restaurant Holdings, the company that operates pizza franchises Happy Joe's Pizza and Ice Cream and Tony Sacco's, sought federal bankruptcy protection, blaming its issues on the lingering impact of the COVID-19 pandemic as well as high labor and food costs. Dynamic has $5.3 million in secured debt and said it hopes to close company stores. Dynamic operates six Happy Joe's locations and franchises more than 30 additional units.
The owners of Lower East Side party venue the Bowery Savings Bank filed for Ch. 11 protection to stave off a forced sale after defaulting on their $12 million loan from Wells Fargo. The company, 130 Bowery Acquisition, was forced to declare bankruptcy and fell behind on its loan once the building's sole tenant, events organizer Capitale NYC, missed its rent payments during the pandemic. The owners put the 40,000-square-foot former bank at 130 Bowery Street up for sale in January for about $35 million, a month before Wells Fargo sued them for allegedly missing two years of payments on their loan. Wells Fargo hoped to force a sale of the 129-year-old building through an auction, but a bankruptcy filing will give the owners time to sell the property at a higher price.
Cineworld Group, the parent company of movie theater chain Regal Cinemas, filed for bankruptcy as it works to get its nearly $5 billion in debt under control. As part of its Ch. 11 proceedings, Cineworld obtained $1.94 billion in debtor-in-possession financing to continue and said it would work with landlords in the U.S. to improve lease terms for its theaters. Cineworld has been weighing a bankruptcy filing as it wrestled with its failure to improve attendance numbers from pandemic lows plus upcoming maturities from its debt load.
A bankruptcy judge ruled that Revlon's office and retail leases at 200 Park Ave. South could be legally terminated as part of the company's Ch. 11 proceedings. The company filed for bankruptcy protection in June amid faltering sales and a heavy debt burden. Terminating its leases at the building, which is owned by ABS Partners, could save Revlon $17 million.
A U.S. bankruptcy judge declined to appoint an equity committee in Revlon's bankruptcy, rejecting a minority shareholder demand for a greater say in the cosmetics company's restructuring. The judge found shareholder interests were already represented in the bankruptcy by Revlon, majority shareholder MacAndrews & Forbes, and the minority shareholder group led by investment advisor Mittleman Brothers LLC, which is free to continue advocating for shareholders on an unofficial basis. Revlon filed for Ch. 11 in June, saying its debt load left it too cash-poor to make timely payments to critical vendors in its cosmetics supply chain.
Johnson & Johnson's talcum powder liability spinoff asked the Third Circuit to reject ovarian cancer and mesothelioma patients' calls to dismiss its Ch. 11 filing, claiming it was a good-faith effort to fairly deal with its talc liability. LTL Management said the plaintiffs were wrong to claim that handling the liability through bankruptcy was a bad faith move, claiming that since juries have delivered wildly varying results in talc cases, bankruptcy distribution was the fairest way to compensate claims. The company further argued that bankruptcy proceedings would save millions in "deadweight" litigation costs incurred from handling the cases in state court.
A Delaware bankruptcy judge approved $1.4 million in Chapter 11 financing for NASA contractor Masten Space Systems from the stalking horse bidder in an auction Masten hopes to run in a month. California-based Masten filed for Chapter 11 protection in July with $21.6 million in unsecured claims, primarily by the company's vendors. According to court filings, the company, founded in 2004, had primarily engaged in the development of reusable suborbital rockets and other space and rocket technology before winning a $79.5 million NASA contract in 2020 to transport a scientific research payload to the lunar South Pole as part of NASA's Artemis program, with a launch on a SpaceX rocket set to take place in 2023. In his Chapter 11 declaration, company founder David Masten said the project forced the company to rapidly scale up its facilities and workforce, but that it experienced difficulties due to the COVID-19 pandemic. The project was far more expensive than any prior one Masten Space Systems had handled, and the company lacked experienced managers to handle the expenses. Design changes led to cost overruns, and by February the company was unable to pay its vendors, he said.
Joel Schreiber filed a Chapter 11 petition in a New York bankruptcy court ahead of a planned foreclosure sale of the Broadway Trade Center in Los Angeles after lender Starwood declined to grant an extension for $214 million in debt for the property. The historic 1.12 million-square-foot property is completely vacant and takes up half a city block at 801 South Broadway. Schreiber's Waterbridge Capital acquired the property with Continental Equities for $122.3 million in August 2014, and secured entitlements for 624,500 square feet of office and 345,000 square feet of retail space, along with more than 100 hotel rooms and residential use.
A Texas bankruptcy judge gave J.C. Penney permission to settle nearly $30.3 million in claims for just more than $12.4 million, which the estate said was more efficient than attempting to fight the claims in court. The company said the settlement was largely for personal injury claims brought against the retail chain that would have required "fact-intensive litigation." The motion said the settlements were being sought for 96 claims - 84 general liability claims, seven trade claims and five employee benefit claims.
3M urged a federal judge not to interfere with its plan to move claims that its military-issue earplugs caused hearing damage into bankruptcy court, where the company believes it can resolve them more favorably than in federal mass tort litigation in Florida. The filings came in response to motions filed by veterans seeking to block 3M from avoiding lawsuits by putting its Aearo Technologies subsidiary, the original maker of the earplugs, which it bought in 2008, into bankruptcy. Plaintiffs said they suffered injuries including tinnitus and hearing loss after using Aearo's CAEv2 earplugs in combat or training because they did not form an adequate seal.
Endo Pharmaceuticals warned investors that it may very soon become the next opioid maker to seek refuge in bankruptcy, saying a Chapter 11 filing could be imminent in the face of continuing opioid suits and substantial debt. The drugmaker said it opened restructuring talks with senior creditors as it attempts to deal with opioid liability, other legal actions and $8.2 billion in debt. It said since January it has agreed to more than $137 million in opioid settlements, including a $65-million deal with the state of Florida, a $25-million deal with the state of Alabama and a $10-million deal with the city of San Francisco. The company is also facing multiple antitrust actions. Endo would follow major opioid manufacturers Purdue Pharma and Mallinckrodt into Chapter 11. Both received approval for reorganization plans that established trust funds to pay opioid claims.
The former owner of two Philadelphia hospitals proposed a settlement in Delaware bankruptcy court that would resolve a long-running dispute with entities that own the real estate upon which the facilities sit. Center City Healthcare said it had reached a deal that disposes of a series of legal controversies over the Philadelphia properties involving entities affiliated with Paladin Healthcare Capital founder Joel Freedman. The deal would see the debtor share in the proceeds from the eventual sale of property in Philadelphia where the now-shuttered Hahnemann University Hospital is located. The debtor will also receive $6.65 million in cash and will benefit from the withdrawal of more than $1 billion of claims asserted by Harrison Street Real Estate and MBNF Investments against the bankruptcy estate.
OSG Group filed for bankruptcy listing as much as $10 billion in debt and $1 billion in assets. The company is owned by Aquiline Financial Services Fund III, employs more than 4,700 people worldwide and has about 6,000 clients.
According to data provided by Epiq Bankruptcy, there were 212 commercial Chapter 11 filings registered in July 2022, a decrease of 13% from the 245 filings in July 2021. Overall commercial filings decreased 8% in July, as the 1,592 filings were down from the 1,723 commercial filings registered in July 2021. Small business filings decreased 3% to 104 in July from 107 in July 2021. Total bankruptcy filings were 30,848 in July, a 5% decline from the July 2021 total of 32,399. July's commercial Chapter 11 filings decreased 53% from the 449 filings in June.
Gold Standard Baking LLC won a bankruptcy court's approval to sell its business to 37 Baking Holdings LLC for $20 million in credit plus assumed liabilities, allowing the Chicago-based bakery to keep operating. Gold Standard, which produces more than 1.7 million pounds of baked goods per week on average and is a leading croissant supplier in the U.S., filed for bankruptcy in June with $140 million in long-term debt and plans in place for a sale to its secured lenders.
A Delaware bankruptcy judge approved $147 million in Chapter 11 financing for mortgage lender First Guaranty Mortgage after the company reached a deal with its unsecured creditors on the terms of the loan. The judge approved First Guaranty's DIP financing and the payment of more than $1.4 million in employee bonuses after the unsecured creditors' committee dropped its objections to both proposals. The mortgage lender and affiliate Maverick II Holdings LLC filed for Chapter 11 protection in June.
A New York bankruptcy judge approved a $1.4 billion Chapter 11 financing package for Revlon over the objections of the company's unsecured creditors, saying the terms were ultimately fair and reasonable. The judge said although some arguments raised by the unsecured creditors' committee had merit, he found no reason to override Revlon's judgment that the financing was the best possible deal for all the parties in the Chapter 11. Revlon hit bankruptcy in June, saying it has encountered a serious liquidity crunch in the face of continuing supply chain issues that have left it unable to meet customer demand for its products, a situation that has constrained its access to the full amount under its asset-based lending facilities.