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Revlon Inc. is grappling with a growing number of allegations that some of its hair products cause cancer as the cosmetics company looks to exit chapter 11 protection, Bloomberg News reported. Thousands of consumers are alleging Revlon owes them money because they used the company’s hair relaxer products and later developed cancer. But a deadline to formally lodge such claims against the bankrupt company elapsed in October — just after the National Institutes of Health published a study showing a correlation between some chemical hair relaxers and uterine cancer. On Tuesday, Revlon’s bankruptcy judge extended the deadline by which customers with certain types of cancer can file claims against the company. They now have until April 11, which will also allow them to vote on the bankrupt company’s restructuring plan later this month. “What we’ve got here in my view is a mass tort in the making,” said Sander Esserman, an attorney who spoke on behalf of various cancer claimant groups during the Tuesday bankruptcy hearing. “It’s a dynamic situation, and there will no doubt be many cases in the future as they continue to market and the women develop various forms of cancers that are contestable.” Robert Britton, an attorney representing Revlon, said the company disputes any link between cancer and its hair relaxer products. He added that the exponential growth of claims in a matter of weeks suggests that more vetting of the claimants might be needed.

A plan for the owner of a senior living community in Plano, Texas, to emerge from bankruptcy faces a creditor vote this month, a confirmation hearing in April, and opposition from the trustee for nearly $66.8 million of defaulted revenue bonds, The Bond Buyer reported. BSPV-Plano, LLC, a Texas limited liability company, filed the chapter 11 case in the U.S. Eastern District of Texas Bankruptcy Court in March 2022 after Bridgemoor at Plano, its 318-unit rental project, was beset with problems. Bond trustee The Huntington National Bank said that Bankruptcy Judge Brenda Rhoades approved the company's disclosure statement Feb. 24 despite its opposition and that it expects to file an objection to the plan's confirmation on or before March 29, according to a notice to bondholders posted Monday on the Municipal Securities Rulemaking Board's EMMA website. A court hearing on the plan's confirmation is scheduled for April 13 and 14.

U.S. regulators won’t be allowed to punish executives or advisers involved in the bankruptcy of Voyager Digital Ltd. for creating a new cryptocurrency that would help repay customers of the failed digital asset lender, a judge said yesterday, Bloomberg News reported. The comments by Bankruptcy Judge Michael Wiles reflect a growing conflict between efforts to rehabilitate troubled crypto companies and an increased regulatory push by the Securities and Exchange Commission. SEC lawyers have opposed a legal protection typically given to executives and restructuring advisers of a bankrupt company. The protection blocks lawsuits against those professionals for implementing a court-approved bankruptcy plan. The SEC’s position would “leave a sword hanging over the heads of anybody who’s going to do this transaction,” Judge Wiles said. “How can a bankruptcy case or any court proceeding function with that kind of suggestion?” Judge Wiles’s remarks came during the third day of debate over a plan by Voyager to issue a new cryptocoin and sell itself to Binance.US, the US arm of the world’s biggest crypto exchange. SEC lawyers argue that the proposals likely will violate federal law because, in their view, the new coin is an unregistered security and Binance.US is operating an unregulated securities exchange. SEC lawyer Therese A. Scheuer argued that the legal protections are so broad that Voyager employees and lawyers would have permission to violate securities laws. After several minutes of debate, Voyager lawyers agreed to change the plan to narrow the legal releases.

Alameda Research, the trading arm of the bankrupt digital-asset exchange FTX, has filed a lawsuit against Grayscale Investments alleging “exorbitant management fees” and accusing Grayscale of “improperly preventing redemptions” from the Bitcoin and Ether trusts it manages, Bloomberg News reported. “We will continue to use every tool we can to maximize recoveries for FTX customers and creditors,” John J. Ray III, chief executive officer and chief restructuring officer of the FTX Debtors, said in the statement. “Our goal is to unlock value that we believe is currently being suppressed by Grayscale’s self-dealing and improper redemption ban.” A spokesperson for Grayscale said the lawsuit was “misguided”: “Grayscale has been transparent in our efforts to obtain regulatory approval to convert GBTC into an ETF — an outcome that is undoubtedly the best long-term product structure for Grayscale’s investors. We remain confident in the common sense, compelling legal arguments that will be argued tomorrow before the D.C. Court of Appeals.” For two years, the $14.8 billion Grayscale Bitcoin Trust (ticker GBTC) has been trading at a steep discount to the cryptocurrency it holds. The group of FTX debtors said they are seeking injunctive relief to unlock $9 billion or more in value for shareholders of the two Grayscale trusts.

A long road lies ahead to repair confidence in crypto after unprecedented bankruptcies and hacks, including the major challenge of giving investors a way of insuring against such events, Bloomberg News reported. Stock brokerage accounts often come with some cover against outcomes like bankruptcy but digital-asset platforms provide few if any shields, a reality underlined by the November collapse of Sam Bankman-Fried’s FTX exchange. Investors seeking such policies face a tough task. Traditional insurers are wary and crypto-native solutions in decentralized finance — or DeFi — account for a fraction of the $1.1 trillion digital-asset sector. For instance, funds locked in DeFi insurance protocols amount to about $300 million, compared with more than $80 billion in DeFi services overall, according to data from DeFiLlama. “Last year highlighted the importance of insurance but it seems a very difficult problem for DeFi to solve,” said Riyad Carey, a research analyst at crypto data provider Kaiko. “To properly protect a protocol or position is challenging.” The largest DeFi insurance provider is Nexus Mutual, a member-based service accounting for about 70% of funds locked in crypto-native insurance protocols. Nexus Mutual has paid out roughly $5 million in claims from the bankruptcies of FTX and crypto lender BlockFi. It expects to pay another $2 million but those figures are dwarfed by the billions of dollars eviscerated by FTX alone.

New cryptocoins that Voyager Digital Ltd. plans to issue to pay creditors in bankruptcy are actually securities that should be regulated, a lawyer with the U.S. Securities and Exchange Commission said in court on Friday, Bloomberg News reported. The comments by William Uptegrove, reflecting the views of the SEC staff, may complicate the bankrupt crypto firm’s proposal to repay creditors by issuing the digital tokens, part of a plan that also includes selling itself Binance.US, the U.S. arm of the world’s biggest crypto exchange. Uptegrove was arguing against the proposal and responding to skeptical questions about the SEC staff’s views from the judge overseeing Voyager’s bankruptcy case. The commission itself has not taken a position, the lawyer said. Uptegrove also said SEC staff have concluded that Binance.US is operating an unregulated securities exchange. Earlier Friday, a Voyager restructuring adviser testified that Binance.US is facing an investigation by the SEC. The SEC lawyer’s comments were met with a call for clarity from Binance.US. “It is regrettable that an SEC staff member would make allegations, that Binance.US and platforms like ours are operating an unregistered exchange, without specifying the assets listed on our exchange that the SEC considers to be securities,” a spokesperson for the trading services provider said. Bankruptcy Judge Michael Wiles has held two days of hearings about the Binance.US sale and the related payout plan.

Prosecutors and attorneys for FTX founder Sam Bankman-Fried are requesting the disgraced cryptocurrency entrepreneur be allowed a flip-phone or another device that’s not a smartphone while on bail, the Associated Press reported. The proposal, submitted in a letter Friday, comes as the judge in the case is deciding how to toughen Bankman-Fried’s bail requirements amid concerns the former billionaire might be communicating on electronic devices in ways that can’t be traced. Prosecutors alleged last month Bankman-Fried used a virtual private network that blocks third parties from seeing online activity, known as VPN, to access the internet twice. They also said he sent an encrypted message over the Signal texting app in January to the general counsel of FTX US, a move they argued might indicate witness tampering. Bankman-Fried has pleaded not guilty to charges that he cheated investors and looted customer deposits at FTX, his cryptocurrency platform.

Shareholders of bankrupt bitcoin miner Core Scientific Inc. will have an official voice in its chapter 11 case and a $4.75 million budget from the company to advocate for as large a recovery as possible for its equity, WSJ Pro Bankruptcy reported. Bankruptcy Judge David Jones in Houston said on Friday that he was approving the appointment of an official committee of equity holders after warning that he would closely examine — and potentially claw back — any legal fees incurred by shareholders for unnecessary litigation. Creditors including BlackRock Inc. and Apollo Global Management Inc. had opposed the formation of an official equity committee, saying its fees would eat into recoveries on the company’s secured debt, which isn’t guaranteed to be paid in full. But Core Scientific agreed to fund the equity committee after the rising price of bitcoin fueled hopes that its shares would have value despite its bankruptcy filing. Judge Jones said last week that he would respect the company’s business judgment. He also warned that he would use any tools available if the equity committee pursued litigation that didn’t add value to the chapter 11 estate.