Category Archives: Bankruptcy

Official advisers to Washington Prime Group Inc. stockholders, skeptical of the Columbus-based company's proposed sale to SVPGlobal, are trying to slow down the mall landlord's bankruptcy.

A government-appointed group of Washington Prime stockholders has asked Judge Marvin Isgur to extend key deadlines in the insolvency proceedings by more than a month, arguing in court papers that the group's advisers don't have enough time to evaluate the real estate investment trust's Chapter 11 exit plan. Washington Prime may be worth more than the plan implies, but more time is needed to figure that out, the group says.

Washington Prime entered bankruptcy last month after the pandemic forced shoppers to stay home, crushing its tenants and sapping revenues. But rising vaccination rates and a resurgent U.S. economy have begun to reverse the company's fortunes, making it difficult to pin a value on its portfolio of roughly 100 shopping centers across the U.S. The company's website indicates it has nine malls in Ohio, including Great Lakes Mall in Mentor and Southern Park Mall in Youngstown.

The company plans to exit bankruptcy by handing ownership to investment firm SVPGlobal in exchange for debt forgiveness, assuming no better offers come in. But the plan's August approval deadline leaves relatively little time for competing bidders to make moves, and the company has said new offers must be all-cash and exceed $2.3 billion.

Critics say the timeline is especially cramped given the size and complexity of the company, while Washington Prime's lawyers have said its sale process is more than adequate. The stockholder group said its valuation consultant Newmark Valuation & Advisory needs more than the three weeks currently allotted to determine whether the sale to SVPGlobal is fair.

"With so much positive change in such a short period of time, it is very difficult today to discern the Debtors' worth, other than to say it is undoubtedly on the upswing," lawyers for the stockholders wrote in court papers. Through the proposed deal, "SVP seems to be 'buying' the Debtors' assets and business for a price that may not reflect true inherent value but is, rather, exploitative of momentary economic disruption."

Washington Prime and a representative for SVPGlobal declined to comment.

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Washington Prime investors seek to slow the mall owner's bankruptcy - Crain's Cleveland Business

As if partaking in the powerful drug it aggressively marketed, being at the forefront of the opioid boom was a dizzying high for Purdue Pharma. But it ultimately proved crippling for the manufacturer of OxyContin.

On Tuesday, the company revealed that its bankruptcy plan has received overwhelming support. The move will allow Purdueto settle thousands of lawsuits it faced over its role in helping trigger and fuelthe opioid crisis.

Among nearly 5,000 state and local creditors, 97% voted to accept the chapter 11 reorganization plan. A confirmation hearing is set for Aug. 9.

RELATED: OxyContin maker Purdue wins 15 states support in controversial $4B bankruptcy plan

This is an unprecedented expression of support for a restructuring of this size and complexity, in favor of a plan that will provide needed resources to those affected by the opioid crisis, Purdue Pharma CEO Steve Miller said in a release.

The vote came less than three weeks after 15 states signed off on Purdues controversial plan, which would transform the company into a nonprofit in exchange for excusing it from future litigation. Purdues owners, the Sackler family, would agree to settle for $4.5 billion to be paid over nine years, said the New York Times.

According to the House Committee on Oversight and Reform, which has been investigating Purdues role in the opioid crisis, the combined assets of the family are $11 billion. The committee estimated that opioid sales generated roughly $30 billion in revenue for Purdue.

RELATED: Purdue reaches $8B settlement on federal opioid chargesbut will it ever pay that amount?

There is considerable government pushback for the plan. On Monday, in Purdues home state of Connecticut, Sen. Richard Blumenthal (D) and attorney general William Tong voiced support for closing the loophole that allows large companies to declare bankruptcy to sidestep litigation. Tong will testify before a House Judiciary subcommittee on the issue this week.

Last week, Reuters reported that Johnson & Johnson is also considering a bankruptcy plan, which would entail establishing a new company in which to funnel lawsuits over its talcum products and then declaring it bankrupt.

Also last week, J&J and three distributors agreed to a landmark opioid settlement which resolved lawsuits for $26 billion.

Purdue has spent years in court battling opioid lawsuits. In October of 2020, it settled with the Justice Department for more than $8 billion to plead guilty and settle federal criminal and civil claims linked to its OxyContin actions.

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Purdue points to creditor support for bankruptcy plan to escape opioid litigation but will Congress follow - FiercePharma

The Insolvency and Bankruptcy Code (Amendment) Bill, 2021, which proposes a pre-packaged insolvency resolution mechanismfor micro, small and medium enterprises, was passed in the Lok Sabha on Wednesday.

The bill replaces the Insolvency and Bankruptcy Code (Amendment) Ordinance, 2021, which was promulgated on April 4, when Parliament was not in session, and amends the Insolvency and Bankruptcy Code, 2016.

Moneycontrol explains what the pre-packaged insolvency resolution process is,how it will be implemented, how it differs from the corporate insolvency resolution process (CIRP) and what its benefits are.

What is a pre-packaged insolvency resolution mechanism?

A pre-packaged insolvency resolution mechanism is an alternative method of providing a corporate rescue plan for MSMEs.

Under this framework, a debtor initiates and participates in the resolution proceedings with lenders through an informal process. Once the promoters of the company and the secured creditors agree on a resolution plan, they can approach the National Company Law Tribunal for approval.

How is the pre-packaged resolution initiated?

An MSME that has not met its payment obligation of10 lakh can initiate this scheme with approval from lenders that have advanced 66 percent of the debt amount.

What isthe corporate insolvency resolution process?

Under the existing CIRP model, an insolvent borrower is taken to bankruptcy court by the creditors for a timebound resolution and the process allows other entities to bid for the stressed entity.

How does the pre-packaged resolution process differ from CIRP?

Under CIRP, the promoter of a stressed unit cannot bid for it. A resolution professional is appointed to oversee the companys activities and the incumbent promoters have to step down. The resolution professional also manages the bidding and resolution process, for which there is a 270-day deadline.

Under the pre-packaged resolution model, the stressed borrower can prepare a resolution plan with the creditors, which could involve selling the company to an investor, before approaching the NCLT. The borrower retains management control of the company until a resolution is decided.

The time limit for the resolution has been drastically reduced to 120 days 90 days to submit a resolution plan and 30 days for the NCLT to approve or reject it. Promoters can also bid for their companies in the case of a buyout.

What are the benefits of the pre-packaged model?

For the NCLT, it will be a relief because the tribunal is burdened with several cases that can take several months. The tribunal will only have to reject or approve a resolution plan for MSMEs.

The promoters can continue to be in charge of their company until a settlement is reached and business activities can go on unhindered. The shorter time available for resolution will ensure that a companys assets are not eroded.

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Explained: All you need to know about the Insolvency and Bankruptcy Code (Amendment) Bill, 2021 - Moneycontrol.com

Our process begins with our distressed company analysis. Our analysts use proprietary technology and methods to discover companies that exhibit signs of stress.

When a company does file for bankruptcy, we kick into gear. We compile a database of case information for all companies that file for bankruptcy in the 94 U.S. Bankruptcy Courts in near real time.

We also track and report on public companies currently operating under Chapter 11 protection, in addition to all companies with 50MM in assets or liabilities. This process allows us to continue collecting information about the public companies bankruptcies, including: plans of reorganization and disclosure statements, debtor-in-possession financing information, professional retention data, 363 sales motions, key employee incentive plans, monthly operating reports, claim transfer activity, securities and security pricing data, committee information, and much more.

Our platform allows subscribers to flesh out extensive details pertaining to individual bankruptcies, identify a group of companies that meet specific criteria, or stay on top of the industry as a whole.

BankruptcyData has revolutionized the way in which professionals interested in the bankruptcy sector consume, share, manage, and leverage vital data, research, and analysis. We provide a competitive advantage to those interested in making more informed decisions regarding the bankruptcy and distressed sectors

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BankruptcyData

Filing bankruptcy can help a person by discarding debt or making a plan to repay debts. A bankruptcy case normally begins when the debtor files a petition with the bankruptcy court. A petition may be filed by an individual, by spouses together, or by a corporation or other entity.

All bankruptcy cases are handled in federal courts under rules outlined in the U.S. Bankruptcy Code.

There are different types of bankruptcies, which are usually referred to by their chapter in the U.S. Bankruptcy Code.

Bankruptcy Basics provides detailed information about filing.

The rules of procedure that govern how Bankruptcy Courts operate are called the Federal Rules of Bankruptcy Procedure.

Seeking the advice of a qualified lawyer is strongly recommended because bankruptcy has long-term financial and legal consequences. Individuals can file bankruptcy without a lawyer, which is called filing pro se. Learn more.

You can either browse the Bankruptcy Code using the menu on the right side of you screen or you can proceed directly to the Table of Contents.

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U.S. Bankruptcy Code | 2020 Official Edition

Editorial Note: Forbes Advisor may earn a commission on sales made from partner links on this page, but that doesn't affect our editors' opinions or evaluations.

When you file for Chapter 7 or Chapter 13 bankruptcytwo of the most common individual bankruptciesit can remain on your credit reports for up to ten years. After a bankruptcy is listed on your reports, it causes serious damage to your credit score until its removed. This means you will likely have trouble qualifying for a mortgage, auto loan or personal loan.

However, the good news is that you can take steps to speed up the credit rebuilding process. Lets take a look at how long both types of bankruptcies remain on your credit reports. Afterward, well walk you through some steps you can take to improve your credit score.

Experian can help raise your FICO Score based on bill payment like your phone, utilities and popular streaming services. Results may vary. See site for more details.

After you file for a Chapter 7 bankruptcy, it remains on your credit reports for up to ten years and youre allowed to discharge some or all of your debts. When you discharge your debts, a lender cant collect the debt and youre no longer responsible for repaying it.

If a discharged debt was reported as delinquent before you filed for bankruptcy, it will fall off of your credit report seven years from the date of delinquency. However, if a debt wasnt reported delinquent before you filed for bankruptcy, it will be removed seven years from the date you filed.

A Chapter 13 bankruptcy stays on your credit reports for up to seven years. Unlike Chapter 7 Bankruptcy, filing for Chapter 13 bankruptcy involves creating a three- to five-year repayment plan for some or all of your debts. After you complete the repayment plan, debts included in the plan are discharged.

If some of your discharged debts were delinquent before filing for this type of bankruptcy, it would fall off your credit report seven years from the date of delinquency. All other discharged debts will fall off of your report at the same time your Chapter 13 bankruptcy falls off.

Since your credit score is based on the information listed on your credit reports, the bankruptcy will impact your score until it is removed. This means a Chapter 7 bankruptcy will impact your score for up to 10 years while a Chapter 13 bankruptcy will impact your score for up to seven years. However, the impact of both types of bankruptcies on your credit score will lessen over time. Plus, If you practice good credit habits, you could see your score recover faster.

Also, how much your credit score decreases depends on how high your score was before filing for bankruptcy. If you had a good to excellent score before filing, this likely means your credit score will drop more than someone who already had a bad credit score.

If your credit has taken a major hit because of bankruptcy, you can rebuild it. Here are five steps you can take.

Related: 7 Easy Ways To Rebuild Your Credit After Bankruptcy

Monitoring your credit report is a good practice because it can help you catch and fix credit reporting errors. After going through bankruptcy, you should review your credit reports from all three credit bureausExperian, Equifax and Transunion. Due to Covid-19, you can view your credit reports for free weekly through April 20, 2022 by visiting AnnualCreditReport.com.

While reviewing your reports, check to see if all accounts that were discharged after completing bankruptcy are listed on your account with a zero balance and indicate that theyve been discharged because of it. Also, make sure that each account listed belongs to you and shows the correct payment status and open and closed dates.

If you spot an error while reviewing your credit reports, dispute it with each credit bureau that includes it by sending a dispute letter by mail, filing an online dispute or contacting the reporting agency by phone.

Payment history is the most important credit factor, which accounts for 35% of your FICO credit score. If you repay any outstanding debts you have on time, it could improve your credit score. However, if you make late payments or default on a loan, your credit score can suffer further damage.

Another key credit score factor is your credit utilization ratioit accounts for 30% of your FICO Score. Your credit utilization ratio measures how much of your credit you use versus how much you have available. For example, if your available credit is $10,000 and you use $2,000, your credit ratio is 20% ($2,000/$10,000).

Although its often recommended that you keep your ratio below 30%, you may be able to rebuild your credit faster by keeping it closer to 0%.

After filing for bankruptcy, its unlikely that you will qualify for a traditional credit card. However, you may qualify for a secured credit card. A secured credit card is a credit card that requires a security depositthis deposit establishes your credit limit.

As you repay your balance, the credit card issuer usually reports your payments to the three credit bureaus. Repaying your balance on time can help you build credit. Once you cancel the card, a credit card provider typically issues you a refund for your deposit.

When shopping for secured credit cards, compare annual fees, minimum deposit amounts and interest rates to secure the best deal.

If you dont want to take out a secured credit card, you can ask a family member or friend who has good credit to add you as an authorized user on one of their credit cards. You may see an increase in your credit score if the issuer reports the cards positive payment history to the three main credit bureaus. However, your score could take a dip if the primary cardholder makes a late payment or maxes out their credit limit.

Depending on which type of bankruptcy you file, it can remain on your credit report for up to ten years. This can negatively impact your ability to access credit for a long time. However, as time passes, its impact on your credit score will lessen. If you want to get a head start on repairing your credit score after bankruptcy, take some of the actions mentioned above.

Experian can help raise your FICO Score based on bill payment like your phone, utilities and popular streaming services. Results may vary. See site for more details.

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How Long Does A Bankruptcy Stay On Your Credit Report? - Forbes

By T. D. Thornton

The law firm representing Ahmed Zayat in his $19-million bankruptcy pleading asked a federal judge Monday for permission to walk away from the case based on Zayat's alleged non-payment of $368,273 to the firm in outstanding legal fees.

The representation of the Debtor has consumed an extremely significant amount of the available resources of our firm, wrote attorney Jay Lubetkin of Rabinowitz, Lubetkin & Tully, LLC, in a July 26 motion to withdraw filed in United States Bankruptcy Court (District of New Jersey).

The Debtor has been consistently advised that absent satisfactory arrangements for the payment of the outstanding fees and expenses due to our firm and newly incurred billings, the firm would have no alternative but to seek to withdraw from representation of the Debtor, Lubetkin wrote.

The purportedly insolvent owner and breeder of Triple Crown champ American Pharoah hired the firm when he filed for Chapter 7 bankruptcy protection nearly one year ago.

Lubetkin's firm has also been defending Zayat in an adversary proceeding filed against him by MGG Investment Group, LP, for allegedly obtaining a $24-million loan by fraud and then not repaying it. MGG wants that debt ruled as non-dischargeable.

Zayat's bankruptcy case has repeatedly been slowed by allegations from the trustee assigned to the case that Zayat and his family members have been uncooperative and obstructive as the trustee tries to trace millions of dollars in possibly fraudulent transfers.

Lubetkin wrote in his court filing that at the outset of their legal relationship, Zayat promised to pay what he owed in legal fees based on 60-day receivable terms. He later agreed to make at least $50,000 monthly minimum payments.

At the time of his initial bankruptcy filing in September 2020, Zayat told the court he had only $314.22 to his name.

Lubetkin wrote that Zayat has not paid his firm since May 5, 2021.

If the Debtor were to satisfy his previously expressed commitment to keep our receivables within 60-day terms, it would require an immediate payment of $232,899 and a further payment of $76,717 when the billing governing July's efforts is tendered, Lubetkin wrote.

I attempted at least nine times during the month of July to communicate with the Debtor regarding status of payments to our firm, without substantive or satisfactory response by the Debtor, Lubetkin wrote.

As for who might next represent Zayat, Lubetkin wrote in his filing that Zayat himself fully understands the Chapter 7 bankruptcy process and is fully capable of representing himself.

Lubetkin wrapped up his motion for withdrawal by noting that when he finally did manage to reach Zayat July 21, it seems as if Zayat tried to tell him he was fired before Lubetkin could quit.

[W]hile not knowing what the Debtor's intentions were at the time of the communication, Lubetkin wrote, the Debtor requested that I write to the Court to advise my firm was 'no longer defending the Debtor, which may be interpreted as the Debtor terminating his relationship with our firm.

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Zayat's Bankruptcy Lawyers Want to Sever Ties Over $368K in Unpaid Fees - Thoroughbred Daily News

The company and law firm names shown above are generated automatically based on the text of the article. We are improving this feature as we continue to test and develop in beta. We welcome feedback, which you can provide using the feedback tab on the right of the page.

(Reuters) - Here is a look at some upcoming events of interest to the bankruptcy law community. Unless otherwise noted, all times are local, and court appearances are virtual due to the COVID-19 pandemic.

Monday, July 26

11:15 a.m. Brazos Electric Power Cooperative will seek approval to extend by four months its exclusive period to file a Chapter 11 plan. Its unsecured creditors committee filed a limited objection, asking a judge to impose certain deadlines for the co-op to meet if he approves the extension. The case is In re Brazos Electric Power Cooperative Inc, U.S. Bankruptcy Court, Southern District of Texas, No. 21-30725. For Brazos: Louis Strubeck of OMelveny & Myers. For the committee: Thomas Moers Mayer of Kramer Levin Naftalis & Frankel.

Tuesday, July 27

9:30 a.m. The federally-appointed financial oversight board for Puerto Rico will return to court to present a settlement with two large bond insurers that would resolve their longstanding objections to the commonwealths debt restructuring process. Lawyers for the board and insurers said recently that they had reached a tentative deal with the bond insurers but did not reveal any terms. The case is In re Commonwealth of Puerto Rico, U.S. District Court, District of Puerto Rico, No. 17-03283. For the oversight board: Martin Bienenstock of Proskauer Rose. For Ambac Assurance: Atara Miller of Milbank. For Financial Guaranty Insurance Co: Martin Sosland of Butler Snowe.

Wednesday, July 28

10 a.m. The U.S. House of Representatives' Judiciary Subcommittee on Antitrust, Commercial and Administrative Law will hold the first of what it says will be a series of hearings on potential bankruptcy law reforms. The potential reforms involve the use of non-consensual releases for non-bankrupt parties and the payment of executive bonuses during bankruptcies.

Thursday, July 29

10 a.m. The Boy Scouts of America will hold a preliminary hearing on its proposed settlement with representatives of about 60,000 men who brought sexual abuse claims against the youth organization. Insurers remain opposed to the deal. The case is In re Boy Scouts of America, U.S. Bankruptcy Court, District of Delaware, No. 20-10343. For the Boy Scouts: Jessica Lauria of White & Case. For insurer Century Indemnity Co: Tancred Schiavoni of OMelveny & Myers.

2 p.m. After postponing a July 19 hearing on the matter, Purdue Pharma will seek approval to pay up to $5.4 million in bonuses to five top executives if they meet certain performance goals and up to $16.1 million to another 506 employees. The request has prompted opposition from the U.S. Department of Justices bankruptcy watchdog, the U.S. Trustee. The case is In re Purdue Pharma LP, U.S. Bankruptcy Court, Southern District of New York, No. 19-bk-23649. For Purdue: Marshall Huebner of Davis Polk. For the U.S. Trustee: Paul Schwartzberg.

Friday, July 30

10 a.m. Skincare products maker Avadim Health will seek approval of its proposed sale. The deadline for interested buyers to submit their bids is July 26. If multiple bids are made, an auction will be held on July 29. The case is In re Avadim Health Inc., U.S. Bankruptcy Court, District of Delaware, No. 21-10883. For Avadim: Laura Davis Jones of Pachulski Stang Ziehl & Jones.

Know of an event that could be included in Week Ahead in Bankruptcy? Contact Maria Chutchian at maria.chutchian@thomsonreuters.com

Maria Chutchian reports on corporate bankruptcies and restructurings. She can be reached at maria.chutchian@thomsonreuters.com.

The rest is here:

Week Ahead in Bankruptcy: July 26, 2021 - Reuters

Johnson & Johnson has engaged law firm Jones Day to advise the company as it explores placing a subsidiary in bankruptcy to help settle thousands of personal injury claims linking talcum-based baby powder to cancer, people familiar with the matter said.

Jones Day has been advising J&J on options for addressing talc-related claims, including a possible bankruptcy filing by a subsidiary containing those legal liabilities, the people said. The company has told personal-injury lawyers during settlement discussions that such a bankruptcy filing was under consideration, The Wall Street Journal reported on Monday.

J&J said Tuesday it hasnt decided on a course of action with respect to the thousands of talc lawsuits it faces, except to defend the safety of talc and fight pending claims. The company declined to comment further. Jones Day didnt immediately respond to a request for comment.

Filing a subsidiary for bankruptcy would give J&J several legal tools to resolve current liabilities and future claims over talc-based products, which the company stopped selling in the U.S. and Canada last year.

J&J faced 28,900 injury lawsuits across the U.S. over talc as of April, according to the companys most recent quarterly report, which also said the number of tort claims continues to grow.

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Johnson & Johnson Taps Jones Day to Explore Talc Bankruptcy - The Wall Street Journal

HARTFORD, Conn. (WTNH) Some Connecticut leaders are taking on Big Pharma Monday.

U.S. Senator Richard Blumenthal and Attorney General William Tong will meet at the state Capitol in Hartford to raise awareness about an act that would close a bankruptcy loophole that would allow big companies to avoid paying the full amount of the lawsuits filed against them.

A proposed bankruptcy for Stamford-based Purdue Pharma would require the Sackler Family to pay over nine years only a small fraction of the fortune that they amassed through the sale of opioids. Tong and Blumenthal say thats unacceptable.

Recently, the Sackler family, the owners of Stamford-based Purdue Pharma, the maker of Oxycontin, declared Chapter 11 Bankruptcy.

That followed a series of lawsuits filed against them due to opioid overdoses.

More than a thousand families wrecked by the addiction and opioid crisis in our state. And I dont see any recognition by the Sacklers or Purdue that they played an essential role in this or that theyre responsible, Attorney General Tong said.

The Justice Department blasted Perdue Pharmas bankruptcy plan, saying it allowed the company to avoid liability for alleged wrongdoing by profiting off of one of the most severe public health crises the United States has ever experienced.

According to the Centers for Disease Control and Prevention (CDC), opioid overdose deaths have claimed more than 500,000 lives since 1999.

The state leaders will discuss the SACKLER Act (Stop Shielding Assets from Corporate Known Liability by Eliminating Non-Debtor Releases) in Hartford at noon Monday.

Later this week, Tong will testify before a House Judiciary subcommittee on this very issue.

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CT leaders to raise awareness of Act that would close Purdue Pharma bankruptcy loophole - WTNH.com