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When jurors size up FTX founder Sam Bankman-Fried for the first time, they might not know much about the world of cryptocurrencies. The prosecution and defense each could try to use that to their advantage, the Wall Street Journal reported. Jury selection gets under way today in the criminal case against Bankman-Fried, who is on trial for a series of actions that allegedly led to the abrupt meltdown of the FTX crypto exchange last year. Bankman-Fried is charged with stealing billions of dollars from customers of the FTX crypto exchange and using the money in large part to cover risky bets by its sister hedge fund, Alameda Research. The case involves some complex financial transactions, including allegations that Bankman-Fried instructed a deputy to take a big position in a digital token to manipulate its market price.

A former Pfizer minerals business that supplied talc for cosmetic products has filed for bankruptcy to deal with hundreds of personal injury lawsuits, saying that the drug giant is increasingly unwilling to cover those claims, WSJ Pro Bankruptcy reported. Barretts Minerals becomes the latest business to file for chapter 11 with a goal of resolving talc liabilities, a group that has also included Johnson & Johnson’s LTL Management, Imerys Talc America, Cyprus Mines and Whittaker Clark & Daniels. As awareness of talc litigation grows, the number of personal injury lawsuits that Barretts faces has grown to roughly 550, from 14 before 2018, David Gordon, chief restructuring officer of Barretts, said in a sworn declaration filed yesterday in the U.S. Bankruptcy Court in Houston. Although Barretts no longer sells talc intended for use in cosmetic products, the alleged injuries are primarily due to exposure to asbestos supposedly contained in cosmetic products that used the company’s talc, Gordon said. Barretts, which is headquartered in Dillon, Mont., and has two mines there, was spun off by Pfizer in 1992, when the healthcare business wanted to divest its minerals businesses. Minerals Technologies became an independent company that included Barretts, taking over the specialty minerals businesses.

After a merger with MEI Pharma was unsuccessful, Infinity Pharma has filed for bankruptcy, just as executives had warned when the deal fell through, FierceBiotech.com reported. The Cambridge, Mass.-based biotech filed for chapter 11 bankruptcy on Friday “after considering all strategic alternatives,” according to a regulatory filing dated Sept 28. The company will continue to operate at a reduced level while a restructuring transaction or asset sale is conducted. At the same time, board member Adelene Perkins resigned from her role as chair. Infinity cut three-quarters of its staff and three board members in July after a planned combination with MEI Pharma fell through. Infinity had warned in March that the merger may be the last chance to avoid bankruptcy for the cancer-focused company. Infinity was developing eganelisib in several mid-stage studies, including urothelial cancer and in solid tumors. As the financial troubles mounted, the company tried to look for a strategic transaction to keep the med going. Ultimately, those efforts did not secure a company-saving deal. Meanwhile, MEI has been trading barbs via press release with two shareholders Anson Funds and Cable Car Capital LLC, as the two firms try to remove board members. On Monday, MEI adopted a stockholder rights plan, also known as a poison pill defense, to try and deter the firms from taking control.

Gardner, Mass.-based Heywood Healthcare has voluntarily filed for chapter 11 protection, the organization announced yesterday, Boston25news.com reported. Heywood Healthcare operates Athol Hospital, Heywood Hospital, Heywood Medical Group, Heywood Rehabilitation Center, Murdock School-based Health Center, The Quabbin Retreat, and Winchendon Health Center. “Core hospital services will continue to operate as usual,” Rozanna Penney, co-CEO of Heywood Healthcare, said in a statement Monday. In a statement on its website, Heywood Healthcare said, “In the midst of the pandemic, Heywood Healthcare and community hospitals across the Country were adversely affected by workforce and supply chain challenges and the revenue shortfalls it caused. Heywood Healthcare was also impacted by a costly and lengthy electronic medical record (EMR) transition, while managing its aging infrastructure, and engagement in a milestone construction project, also significantly impacted by the current economic landscape.” Over the past few months, Heywood Healthcare said that it “has made significant progress. Strong volume, responsible fiscal management, excellent operational stewardship, robust revenue cycle work and a dedicated workforce has contributed to improving its financial performance.”

Indiana-based Elmer Buchta Trucking company filed for chapter 11 bankruptcy in September, showing the industry’s turmoil amid challenging demand, TruckingDive.com reported. The carrier, which began business over 80 years ago and transports coal, cited cash flow issues after coal prices declined since December 2022, resulting in less business. “The decision to file for chapter 11 bankruptcy was a carefully considered move to restructure our debt, streamline our operations and positions us for future expansion,” the company said on Sept. 26. In bankruptcy filings, Elmer Buchta Trucking reported $26.2 million in liabilities and $5.6 million in assets; Buchta Leasing reported $27.1 million in liabilities and $23.3 million in assets; WBF reported $24.3 million in liabilities and $502,000 in assets; and ElenaRose Capital reported $6.7 million in liabilities and no assets. Elmer Buchta Trucking CEO Doug Prohaski said in a statement that the company’s core business remains strong. U.S. coal production reached its apex in 2008 at nearly 1.2 billion short tons, and last year, the country produced nearly half that amount. Coal consumption in April of this year dipped below a 2020 pandemic low, and government energy policies have been shifting customers toward other energy sources. A decline in demand across multiple sectors, combined with a surplus of carriers in the past year, has put pressure on freight rates in recent quarters, leading many carriers to exit the trucking business altogether.

WeWork said yesterday that it would not make two sets of interest payments totaling about $95 million, a move meant to jump-start negotiations with its lenders at the same time it tries to cut costs with its landlords, the New York Times reported. The missed interest payments will undoubtedly spur speculation of a bankruptcy filing. But WeWork says it has the cash on hand, and the company has a 30-day grace period to make the payments, which were due Monday. At the end of June, it had $205 million in cash and access to a credit line worth $475 million. “I believe they will absolutely understand our decision to enter into the grace period,” WeWork’s interim chief executive, David Tolley, said in an interview. He called the move “typical” as a “precursor to a conversation.” Skipping an interest payment is not necessary to negotiate with lenders. But it is a move sometimes used by indebted companies to put pressure on lenders to restrike deals under more favorable terms. In the first half of this year, WeWork’s operations consumed $530 million. The co-working company warned investors in August that “substantial doubt exists about the company’s ability to continue as a going concern,” without taking measures like decreasing its lease costs and making its debt load more manageable. In early September, WeWork said that its lease costs made up more than two-thirds of its operating liabilities, a heavy weight on its cash flow that it was trying to alleviate by renegotiating nearly all of its leases and pulling out of some unprofitable locations.

The U.S. Supreme Court on Friday granted the U.S. Solicitor General’s petition for a writ of certiorari in Office of the U.S. Trustee v. John Q. Hammons Fall 2006 LLC, 22-1238 (Sup. Ct.), to decide whether chapter 11 debtors are entitled to refunds for overpayment of fees for the U.S. Trustee System, according to a special analysis from ABI Editor-at-Large Bill Rochelle. In Siegel v. Fitzgerald, 142 S. Ct. 1770 (Sup. Ct. June 6, 2022), the Court unanimously held that the 2018 increase in fees paid by chapter 11 debtors to the U.S. Trustee System was unconstitutional because it was not immediately applicable in the two states with Bankruptcy Administrators rather than U.S. Trustees. The Court in Siegel explicitly left open the question of remedy. The government had been contending that prospective relief was sufficient. In other words, the government believes it is enough for the Court to have ruled that fees must be uniform throughout the country in the future. Alternatively, the government wants courts to rule that someone should retroactively collect underpayments from debtors in Bankruptcy Administrator districts.

Small-business bankruptcy filings are rising this year, a signal that increased interest rates, tighter lending standards and higher operating costs are straining entrepreneurs. At the same time, some government aid programs that helped entrepreneurs through the COVID-19 pandemic have ended, the Wall Street Journal reported. The Federal Reserve’s efforts to slow inflation by raising interest rates have been particularly painful for small businesses, which tend to operate with thinner profit margins and smaller cash reserves than larger companies. The increased bankruptcies are coming from filings under Subchapter V, a newer provision in federal bankruptcy code that makes it easier for financially stressed small businesses to restructure. Nearly 1,500 small businesses filed for Subchapter V bankruptcy this year through Sept. 28, nearly as many as in all of 2022, according to the ABI. Many small businesses came out of the pandemic in solid financial shape and are looking to grow. The share of business owners who expect revenue and profits to increase in the next 12 months grew in September, as did the share of those planning to expand their workforce, the survey found. Still, needed capital is more expensive to access and can be difficult to obtain. Small businesses have fewer options for raising capital than bigger companies, which can issue stock or bonds, or go to private-equity investors and other sources for funding, said Soneet Kapila, a bankruptcy trustee and ABI President.

The Catholic Archdiocese of Baltimore filed for bankruptcy protection Friday, less than two days before a new state law takes effect allowing victims of child sexual abuse to sue institutions, no matter how long ago the abuse took place, the Washington Post reported. The legal action will shift to a bankruptcy court, where the process — if successful — will set a permanent end-date when alleged victims of abuse related to the church can file claims, rather than opening a permanent window as the law intended. Each diocesan bankruptcy is unique, experts say, and outcomes depend on the court, insurance arrangements and the legal setup of the diocese. Some legal analysts said the move by the country’s oldest Catholic diocese could limit damages for some survivors, while other experts say it could more equitably distribute Baltimore’s assets and offer anonymity and streamlined financial awards, which some accusers may value. It wasn’t immediately clear Friday what impact filing under chapter 11 of the bankruptcy code will mean for the archdiocese’s 153 parishes and dozens of ministries, including within the city of Baltimore. Baltimore is the 36th U.S. Catholic diocese or religious order to file for such protection since the Catholic clergy sex abuse crisis exploded into public view in the early 2000s. Baltimore will be the sixth diocese to file in 2023.

The labor union for West Coast dockworkers filed for bankruptcy to fend off a judgment holding it liable for what a federal jury found to be illegal slowdowns and work stoppages at the Port of Portland in Oregon, WSJ Pro Bankruptcy reported. The International Longshore and Warehouse Union filed for chapter 11 protection in a San Francisco court to halt litigation brought by a former terminal operator of the Port of Portland that threatened to deplete the labor union’s cash reserves. The ILWU, which represents dockworkers at major U.S. ports in Los Angeles, Long Beach and Oakland, Calif., is fresh off ratifying a new, six-year contract for about 22,000 workers at 29 ports from California to Washington state to end a period of labor uncertainty for some of the nation’s busiest ports. The dockworkers union also has been facing a looming trial on claims that it illegally slowed down operations over several years at the Port of Portland, then operated by an affiliate of Philippines-based maritime company International Container Terminal Services Inc.