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A lawyer for families of victims of the 2012 Sandy Hook mass shooting on Thursday urged a Connecticut jury to hold conspiracy theorist Alex Jones accountable for building a “lie machine” that profited off of falsehoods about the tragedy, Reuters reported. The attorney, Chris Mattei, said during his closing arguments that Jones and his Infowars website encouraged legions of followers to harass and threaten Sandy Hook families with false claims that they were actors complicit in a government plot to seize guns. “He built a lie machine that put this stuff out,” Mattei said. “You reap what you sow.” Jones and his company, Free Speech Systems LLC, have already been found liable for defamation. The state court jury in Waterbury, Connecticut, is charged only with deciding how much they must pay for claiming the killing of 20 young children and six staff members at Sandy Hook Elementary School in Newtown, Conn., was staged. During his closing arguments Thursday, Jones’ lawyer urged jurors to ignore the polarizing political undercurrents of the case and focus narrowly on the plaintiffs' actual losses.

Kabbage Inc., a small-business credit platform that sold most of its assets to American Express Co. in 2020, filed for bankruptcy facing federal investigations and private lawsuits for its alleged mishandling of thousands of Paycheck Protection Program loans, WSJ Pro Bankruptcy reported. The Federal Reserve Bank of San Francisco declared Kabbage in default last week on a federal liquidity facility for PPP lenders, according to bankruptcy papers filed by the company on Tuesday. Its chapter 11 filing on Monday covers the remnants of Kabbage’s business that were left behind after the October 2020 sale of most of its assets — but not its existing PPP loan book — to Amex. Kabbage, which does business as KServicing, isn’t affiliated with Amex and has continued to service PPP loans that it originated for itself and its partner banks. It has been winding down its operations, but ran out of time and money as federal prosecutors, congressional investigators and other authorities probe its PPP lending and loan-servicing practices. The Atlanta-based company’s restructuring adviser, Deborah Rieger-Paganis, said in a sworn declaration Tuesday that Kabbage is embroiled in costly investigations and litigation despite its adherence to Small Business Administration guidance about the popular relief program. The Justice Department has been cracking down for years on alleged fraud in COVID-19 relief programs, especially the PPP, which issued forgivable, government-guaranteed business loans to keep checks flowing to American workers during the COVID-19 pandemic. U.S. attorneys in Boston and Houston have been investigating whether Kabbage improperly approved fraudulent PPP loans, as well as the company’s fraud and money-laundering controls, court papers show.

A New Jersey bankruptcy judge on Tuesday paused consumer-protection lawsuits brought by New Mexico and Mississippi linking Johnson & Johnson's talc-based products to cancer, Dow Jones Newswires reported. Judge Michael Kaplan of the U.S. Bankruptcy Court in Trenton, N.J., agreed to extend the legal stay protecting J&J's bankrupt talc unit to the parent company, even though it isn't in chapter 11. Judge Kaplan ruled the talc subsidiary, LTL Management LLC, and its chapter 11 case would be irreparably harmed if the state attorneys general were allowed to move ahead with their lawsuits against J&J during the bankruptcy. The state lawsuits allege that J&J was aware that its talc-based products contained cancer-causing asbestos but refused to post a warning on its products, which the company denies. The accusations raised by New Mexico and Mississippi concern the central dispute in LTL's bankruptcy case and would disrupt it if they were allowed to move forward, Judge Kaplan said. The judge also indicated he wouldn't put the state lawsuits on hold indefinitely and would revisit his ruling in December. Although the pause will benefit J&J, Judge Kaplan said the benefits to the company are relatively small compared to the potential harm to LTL and its prospect for settling all talc-related claims against it in chapter 11.

Celsius Network Ltd., the crypto lender that filed for bankruptcy, said that co-founder Daniel Leon resigned this week, Bloomberg News reported. “We confirm that Daniel Leon resigned from his position at Celsius and is no longer part of the organization,” the company said in a statement Tuesday to Bloomberg News. Fellow co-founder and Celsius chief executive officer, Alex Mashinsky stepped down last week. The once high-lying crypto lender is going through bankruptcy after having left thousands of investors in a lurch after making risky bets before the collapse of cryptocurrency prices. In July, the company disclosed a $1.19 billion deficit. The bankruptcy judge in the case recently appointed an examiner to look into allegations of misconduct against the company and its management. Celsius claimed to take on traditional banks, by letting people invest their coins and receive interest on them. In many of its YouTube videos, the company downplayed risks of such investing.

The company behind Alex Jones' conspiracy site, Infowars, has picked a new chief restructuring officer to guide his business through chapter 11 after a bankruptcy judge rejected a prior pick over an undisclosed conflict, Dow Jones Newswires reported. Infowars parent Free Speech Systems LLC on Monday sought bankruptcy court permission to hire Patrick Magill as its new CRO. Mr. Magill is a licensed certified public accountant in retired status with more than 40 years experience assisting private and public companies, according to court documents. Infowars' founder Alex Jones signed an engagement agreement with Mr. Magill's firm on October 3, court papers say. Mr. Magill was selected weeks after U.S. Bankruptcy Judge Christopher Lopez declined FSS' request to hire a different CRO and a lawyer because they failed to disclose their connections to a prior chapter 11 case involving different Infowars affiliates. Judge Lopez also ordered an independent trustee assigned to the chapter 11 case to conduct an investigation of Infowars. FSS said Monday that the trustee has indicated that she'd support appointment of Mr. Magill as the company's new CRO.

Bankrupt cryptocurrency lender Celsius Network Ltd. has set dates for the auction of its assets, Bloomberg News reported. Celsius will have a final bid deadline of Oct. 17 at 4 p.m., with an auction if necessary on Oct. 20 at 10 a.m., according to a filing with the U.S. Bankruptcy Court for the Southern District of New York dated Monday. A sale hearing will be held on Nov. 1 at 11 a.m. before Chief U.S. Bankruptcy Judge Martin Glenn via Zoom, the filing said, adding that a large number of participants is expected. Celsius has been one of the most high-profile casualties of this year’s crypto-market meltdown that claimed the likes of the TerraUSD stablecoin, hedge fund Three Arrows Capital and lender Voyager Digital Ltd. Founder Alex Mashinsky recently resigned the chief executive officer role, ceding it to Chief Financial Officer Chris Ferraro, a JPMorgan Chase & Co. alum. Sam Bankman-Fried, the crypto billionaire who has been bailing out distressed industry players in recent months, is considering bidding for Celsius assets, Bloomberg News reported last week, citing a person familiar with his deal-making.

The former owner of Zest soap and Alberto VO5 hair-care products is at the center of a bankruptcy court lawsuit accusing buyout firm Clayton Dubilier & Rice LLC of hiding investment risks during a $250 million bond offering, WSJ Pro Bankruptcy reported. Bond buyers thought in March 2017 that they were investing in a financially strong High Ridge Brands Co., but they didn’t know that private-equity backer Clayton had expressed doubts internally about the portfolio company just weeks before, according to a bankruptcy-court lawsuit unsealed last month. The month before the bonds were sold, a fund partner allegedly called High Ridge’s performance one of the firm’s “worst misses” in more than a decade. High Ridge used the $250 million bond to repay $93 million in debt owed to a Clayton-owned lending vehicle. High Ridge filed for chapter 11 in 2019 and sold virtually all of its assets, but a liquidating trustee is trying to recover money for unpaid bondholders in the bankruptcy. On Friday, Clayton filed papers asking for the lawsuit to be dismissed, saying it is without merit and is based on emails that were taken out of context. The firm also said the $250 million bond benefitted High Ridge, refinancing debt and lowering its interest rate. The liquidating trustee, Alan Halperin, alleged that Clayton omitted key information from an offering memorandum for the bonds, including that in January 2017 High Ridge fired its sales chief and that Walmart changed its store layout in a way that moved a High Ridge body wash away from eye level.