A federal judge approved on Friday the $5.7 million sale of the Archdiocese of Agana's (Guam) Accion Hotel property, the Pacific Daily News reported. The proceeds will help pay clergy sex abuse claims. U.S. District Court Chief Judge Frances Tydingco-Gatewood, at a hearing, granted the archdiocese's motion for authorization to sell the beach side Yona property to Guam-based TF Investment LLC. Judge Tydingco-Gatewood's decision comes more than a week after the investor previously court-approved to buy the property, Georgia-based bSide Partners, pulled out of its $6.1 million purchase.
Albany Bishop Edward Scharfenberger, who is temporarily leading the diocese in Western New York, said that he is close to making a decision on bankruptcy for the Buffalo church, News10.com reported. The cloud of bankruptcy has hung over the Buffalo diocese since the Child Victims Act went into effect in New York State earlier this year. The Rochester diocese has already filed for chapter 11 bankruptcy. Scharfenberger was named administrator of the Buffalo diocese in December after Buffalo Bishop Richard Malone stepped down amid allegations that he mishandled the scandal.
Yesterday, the Supreme Court granted certiorari in City of Chicago v. Fulton, 19-357 (Sup. Ct.), to resolve a circuit split and decide whether inaction can violate the automatic stay under Section 362(a), Rochelle's Daily Wire reported. The case will likely be argued and decided before the high court’s term ends in late June. An opinion by Bankruptcy Judge Brian F. Kenney of Alexandria, Va., demonstrates how the Supreme Court could dramatically impair the efficacy of bankruptcy by ruling that creditors are not required to unwind actions they have already taken when notified of bankruptcy. Former matrimonial counsel had a judgment against the debtor for more than $10,000. The law firm had obtained a garnishment order under which $1,000 was being held by the clerk of the state court after having been deducted from the debtor’s wages. A hearing was scheduled in state court to rule on turning the garnished funds over to the firm as the judgment creditor. One month before the hearing in state court, the debtor filed a chapter 7 petition, listed the judgment as a debt, gave notice of the filing to the judgment creditor, claimed an exemption in the $1,000, and filed a suggestion of bankruptcy in the state court. Claiming to have performed legal research, the judgment creditor responded to the debtor by saying he was unaware of any obligation to take affirmative action to terminate the garnishment. The judgment creditor said he would appear in state court on the return date, where he expected the state court judge would rule “as the Court deems appropriate.”
Bankruptcy Judge Dennis Montali yesterday approved PG&E Corp.’s $13.5 billion settlement with victims of Californian wildfires, and the company’s stock rallied as the utility gained momentum to emerge from bankruptcy in June as planned, Reuters reported. The settlement provides cash and PG&E stock to a trust for the benefit of individual wildfire victims. Judge Montali also approved an $11 billion agreement with insurance companies, locking up the last and two most significant creditor groups. Adding momentum to PG&E’s plan, a lawyer for Governor Gavin Newsom (D) told Judge Montali the governor viewed the wildfire settlement as fair. “We don’t want to stand in the way of that,” Nancy Mitchell said. On Friday, Newsom rejected the PG&E reorganization plan and said the company would need a new board of directors and stronger finances to comply with a recently enacted wildfire law, known as A.B. 1054.
As his coal mining company hurtled into bankruptcy, Robert E. Murray, the former chief executive, paid himself $14 million, handed his successor a $4 million bonus and earmarked nearly $1 million for casting doubt on man-made climate change, new court filings show, the New York Times reported. The company, Murray Energy, filed for bankruptcy protection in October, reporting $2.7 billion in debts and more than $8 billion in obligations, in large part to pension and health care plans for workers. But those debts appear to have done little to scale back the spending habits of Murray, a prominent supporter of President Trump who helped engineer dozens of climate change and environmental rollbacks over the past three years. The 79-year-old coal executive has been a vocal denier of the established science that human activities like the burning of coal are causing climate change and once warned that his dying industry must receive subsidies from the federal government “to make sure grandma doesn’t die on the operating table.” According to filings made public this week, Murray paid himself $14 million for one year’s wages as chairman of Murray Energy while his then-president, Robert D. Moore, who has since become chairman, earned $9 million annually in addition to his retention bonus.
As scrutiny of Purdue Pharma’s role in the opioid epidemic intensified during the past dozen years, its owners, members of the Sackler family, withdrew more than $10 billion from the company, distributing it among trusts and overseas holding companies, according to a new audit commissioned by Purdue, the New York Times reported. The amount is more than eight times what the family took out of the company in the 13 years after OxyContin, its signature product, was approved in 1995. The audit is likely to renew questions about how much the Sacklers should pay to resolve more than 2,800 lawsuits that seek to hold Purdue accountable for the opioid crisis. The family has offered to contribute at least $3 billion in cash as part of a settlement to resolve thousands of lawsuits brought by state and local governments against Purdue. But 24 states, led by Massachusetts and New York, have refused to sign onto the agreement, arguing that the Sacklers should pay more. The new report, a 350-page forensic accounting prepared by Alix Partners, a consulting firm that Purdue has hired to help guide the company through chapter 11 restructuring, was filed in bankruptcy court yesterday.
Bankrupt utility giant PG&E Corp. has removed a requirement that California Governor Gavin Newsom sign off on its settlement with wildfire victims, trying to buy more time for its restructuring plan, Bloomberg News reported. PG&E reached an agreement yesterday with representatives of the victims of fires ignited by its equipment to eliminate the provision after Newsom said on Friday that the power company’s proposed reorganization plan doesn’t comply with state law. San Francisco-based PG&E announced the decision one day before it was required by the $13.5 billion fire victims deal to respond to Newsom’s rejection and address his concerns. The governor had described the utility’s restructuring plan as falling “woefully short” and called for an entirely new board and a better financing structure, among other things. Killing the clause buys PG&E more time to shape a restructuring plan around the settlement with wildfire victims, which has emerged as the main obstacle to its exit from the biggest utility bankruptcy in U.S. history. The settlement is scheduled for a hearing today in bankruptcy court.
The closure of Hahnemann University Hospital last summer disrupted the lives of thousands who lost jobs there, but a separate, potentially career-altering threat looms for nearly 1,000 medical residents who trained there during the 18 months that California businessman Joel Freedman was running the Philadelphia hospital, the Philadelphia Inquirer reported. The bankrupt hospital has not agreed to buy medical malpractice insurance for residents and fellows that would cover the doctors into the future for incidents while they worked at the hospital. The cost of buying the insurance on their own “ranges from prohibitive at best to impossible depending on their specialties," according to a filing last week by the Ad Hoc Committee of Hahnemann Residents and Fellows. U.S. Bankruptcy Judge Kevin Gross scheduled a hearing for today in Wilmington, Del., at which he will gather evidence on whether the bankruptcies should be converted to a liquidation as opposed to a reorganization. In his order, Gross cited the failure of the bankrupt companies to buy the insurance sought by the residents and their advocates. According to U.S. bankruptcy law, “failure to maintain appropriate insurance that poses a risk to the estate or to the public” provides grounds for converting the case to a chapter 7 liquidation from a chapter 11 reorganization.
