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Old Dominion Freight Line stepped up competition for bankrupt trucker Yellow’s sprawling North American real-estate holdings, outbidding a rival operator with a $1.5 billion offer for the properties, WSJ Pro Bankruptcy reported. The bid surpasses a $1.3 billion proposal by Estes Express Lines and signals a potentially spirited bankruptcy court-supervised auction for the network of 169 truck terminals that would provide Yellow with more than enough money to roughly cover the loans the company accumulated before its chapter 11 filing this month. Yellow was in business for 99 years before the company collapsed this summer. Its terminals include sought-after sites close to major metropolitan areas that are ideal for trucking and logistics companies looking to store and deliver goods quickly to homes. A lawyer for Yellow said earlier this month in bankruptcy court that the company had received formal expressions of interest in Yellow’s assets from almost 100 parties. Executives at several rival trucking companies have said they would be interested in buying some of Yellow’s locations. ODFL’s bid was disclosed in a court filing, setting up the Thomasville, N.C.-based operator as the stalking horse bidder, meaning its offer is subject to higher or better proposals at a court-supervised auction, for Yellow’s properties.

FTX-affiliated cryptocurrency trading firm Alameda Research was granted a $175 million unsecured claim on the estate of bankrupt crypto lender Genesis Global Capital, according to a court filing dated Wednesday, Reuters reported. The settlement marks a significant reduction from the nearly $3.9 billion claim that FTX, which is also bankrupt, had asserted earlier this year. Genesis said the settlement was "fair and equitable" and would allow the company to avoid pursuing "protracted litigation," the outcome of which would be "inherently uncertain." Once-prominent digital asset exchange FTX and lender Genesis Global are two of several crypto firms that went belly up after a turbulent 2022 hit investor sentiment for bitcoin and other crypto tokens. FTX has previously said Genesis was a primary "feeder fund" for Alameda, loaning it crypto assets that it used for further loans and investments. As part of the settlement, the companies also agreed to release all claims against each other.

Mallinckrodt said on Tuesday that it was preparing to seek bankruptcy protection for the second time in three years after struggling to make a required $200 million settlement payment to opioid victims, Reuters reported. The drugmaker, one of the largest makers of opioids, said that it is negotiating a restructuring support agreement with its stakeholders, while deferring deadlines for missed debt payments and opioid settlement payments to next week. The agreement contemplates a second bankruptcy filing that would result in no recovery for holders of its ordinary equity shares, Mallinckrodt said. The Ireland-based company failed to make scheduled payments to its lenders and opioid creditors in June, and it has sought several short-term extensions of the debt deadlines. Mallinckrodt emerged from bankruptcy last year after winning court approval for a reorganization plan that included a $1.7 billion settlement. It paid the first $450 million of that settlement after emerging from bankruptcy, but it failed to make a $200 million payment due in June. The company on Tuesday said it has reached an agreement to extend the opioid payment due date to Aug. 22.

Sinclair Broadcast Group Inc. wrongfully drained at least $1.5 billion from its regional-sports-network subsidiary in the years leading up to its bankruptcy, a new lawsuit alleges, MarketWatch.com reported. In a lawsuit filed last month but made public Wednesday, Diamond Sports Group — which broadcasts nearly half of all Major League Baseball, National Basketball Association and National Hockey League games — accused its parent company of a “nefarious strategy” that sent it “careening toward bankruptcy.” According to the lawsuit, which was filed in U.S. Bankruptcy Court for the Southern District of Texas, Sinclair took more than $100 million a year in management fees from Diamond after acquiring the sports network for $10.6 billion from the Walt Disney Co. DIS, -0.82% in 2019, loaded it with billions in debt and funneled resources from the company while its business was left to languish. According to the suit, MLB Commissioner Rob Manfred testified that Sinclair Executive Chairman David Smith told him in late 2021 that he intended to “continue to milk” Diamond out of hundreds of millions in management fees along with “whatever else” he could take from the company until Sinclair’s original investment in the regional sports network was recouped.

The Texas-investment firm that sought to take over Mercy Hospital in Iowa City is now asking the court to appoint an examiner to investigate the hospital's bankruptcy filings ahead of its sale to the University of Iowa, the Des Moines Register reported. Preston Hollow Community Capital, a major investor in the 194-bed Iowa City hospital, called into question the hospital's plans to liquidate through a bankruptcy fire sale process to the university health system for $20 million. In court filings this week, the Dallas-based company accused Mercy Iowa City leadership of mismanagement, leading to the hospital's "financial freefall" in recent years. As a result, Preston Hollow Community Capital asked the court to approve "a comprehensive financial and legal review" of the hospital, its board of directors, its former managing partner MercyOne and its other partners, including Allscripts Healthcare Solutions, an electronic health records vendor. "In order to achieve that outcome, Preston Hollow Community Capital has requested the court appoint an examiner in line with longstanding provisions of the U.S. Bankruptcy Code," the company said in a statement. "This step will help maximize financial recovery for all creditors, including the pensions of hospital employees and retirees, while at the same time ensuring the sale process is fair and accurately reflects the hospital’s overall value to the community." Mercy Iowa City officials disputed the allegations made by the investment firm in a statement this week. Read more.

The financially troubled healthcare sector will be the focus of the ABI Healthcare Program, September 18-19, 2023, in Nashville, Tenn. For more information and to register, click here.

Lawyers for the Sandy Hook families who won historic defamation damages against the Infowars conspiracy theorist Alex Jones told a federal bankruptcy judge in Houston on Tuesday that Mr. Jones should not be allowed to use his chapter 11 filing to evade $1 billion-plus verdicts made against him, the New York Times reported. The families asked that Judge Christopher Lopez order Mr. Jones to pay them the full damage awards, with no possibility of a trial or a forced settlement over a lesser amount — in legal terminology, to make Mr. Jones’s debts to the families “non-dischargeable” through bankruptcy. If the judge rules in the families’ favor, Mr. Jones would likely be working the rest of his life to pay the debt. Mr. Jones spent years spreading lies that the 2012 shooting that killed 20 first graders and six educators at Sandy Hook Elementary School in Newtown, Conn., was a hoax aimed at gun control. Families of 10 victims sued him for defamation, and in trials in Texas and Connecticut were awarded about $1.4 billion in damages. As the cases went to trial, Infowars declared bankruptcy, and Mr. Jones declared personal bankruptcy late last year. The families have been fighting him in bankruptcy court ever since.

Lordstown Motors said on Tuesday it had reached a $40-million settlement with Karma Automotive over a 2020 lawsuit in which the now-bankrupt electric vehicle firm was accused of stealing proprietary technology, Reuters reported. The settlement, placed with the bankruptcy court for approval, involves $5 million to be paid as royalty for the use of Karma's intellectual property, which Lordstown was accused of having misappropriated. California-based Karma had sued Lordstown for allegedly poaching its employees and stealing technology used in vehicles' infotainment systems. That case is scheduled for trial in September. In June, electric truck company Lordstown filed for bankruptcy protection and put itself up for sale after failing to resolve a dispute over a promised investment from Taiwan's Foxconn. According to a filing, Lordstown's debtors have requested the settlement to be approved by the bankruptcy court on or before August 28, but a hearing has not been scheduled so far. In case the settlement is not approved and the case goes to trial, Lordstown will continue to defend against Karma's claims, the filing added.

FTX founder Sam Bankman-Fried allegedly used $100 million in funds he stole from his customers to make political campaign contributions ahead of the 2022 midterm elections, federal prosecutors wrote in a superseding indictment on Monday, The Hill reported. The prosecutors allege that Bankman-Fried embezzled customer deposits to, among other accusations, “help fund over a hundred million dollars in campaign contributions to Democrats and Republicans to seek to influence cryptocurrency regulation.” This comes just days after Judge Lewis A. Kaplan revoked Bankman-Fried’s bail and sent him to jail, saying that there was probable cause to suggest he had attempted to “tamper with witnesses at least twice” since his December arrest. He had previously been under house arrest as he awaits trial over allegations that he defrauded his investors and unlawfully diverted millions of dollars’ worth of cryptocurrency from FTX customers. The new charges in the superseding indictment allege that Bankman-Fried also directed two FTX executives to avoid political contribution limits and conceal where the money was coming from.

Prosecutors in the criminal case against Sam Bankman-Fried, the founder of the collapsed cryptocurrency exchange FTX, on Monday provided the most detailed account to date of the evidence they plan to use to convict him at trial in October, the New York Times reported. In a 70-page court filing, the prosecutors said they would draw on testimony from some of Bankman-Fried’s closest advisers, as well as an expert witness and other employees of FTX and Alameda Research, a crypto hedge fund he also founded. The prosecutors also said that they planned to use notes that Caroline Ellison, one of Bankman-Fried’s top lieutenants, took after conversations with him, including a memo titled “Things Sam Is Freaking Out About.” And they said that they would introduce a recording of a meeting in which Ms. Ellison told Alameda employees that she had worked with Mr. Bankman-Fried to siphon funds from FTX customers’ accounts. Bankman-Fried, a onetime crypto mogul who built FTX into one of the world’s largest virtual currency exchanges, was arrested in December and charged with orchestrating a sweeping scheme to use customer deposits to finance real estate purchases, charitable giving and donations to politicians. Ellison and two other top FTX executives, Gary Wang and Nishad Singh, have pleaded guilty to participating in the effort and agreed to cooperate with prosecutors. Bankman-Fried faces seven charges of wire fraud, securities fraud, commodities fraud and money laundering. He has pleaded not guilty and is scheduled to go on trial on Oct. 2. Last week, he was sent to jail after the judge overseeing the case revoked his bail over allegations that he was trying to intimidate witnesses.