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Harbor Custom Development, based in Tacoma, Wash., on Monday announced it has filed for chapter 11 bankruptcy protection, the New Star Tribune reported. The NASDAQ-listed company, known for multifamily housing development in the region and upscale housing development in other parts of the country, said in a news release it had “voluntarily filed for protection under Chapter 11 of the United States Bankruptcy Code in the Western District of Washington at Tacoma ... to pursue an orderly wind down or restructuring of its business.” It stated that it had filed motions “that will allow it to continue operating in the ordinary course of business while it prepares a reorganization plan to ensure that it can maximize value for the benefit of its creditors.” The company said it would continue “to market and sell finished lots and homes and to operate multi-family projects as they work towards stabilization.” Its filing listed total assets of $223,981,000, and total debts of $172,528,500 as of Sept. 30. A profile of the company online showed 41 employees, while its LinkedIn profile lists “11-50” workers. The company this year has seen management reshuffling, with former CEO Sterling Griffin retiring in July. Interim CEO Jeff Habersetzer, the company’s former chief operating officer, has been at the helm since Griffin’s departure. Its chief financial officer, Lance Brown, resigned in July, with the company announcement noting the departure did “not relate to any disagreement with the company’s management, the board of directors ..., or the company’s independent auditors regarding any matter pertaining to the company’s operations, accounting practices, financial disclosures, internal controls, policies, or practices.” The company abandoned plans for a luxury apartment development in Tacoma over the summer. Griffin blamed a dismal first-quarter earnings report this year partially on “ongoing challenges in the broader housing market, including higher mortgage interest rates and inflationary pressures.”

U.S. officials will take money away from victims of the fraud-tainted crypto firm, FTX Trading Ltd. unless a judge rejects the government’s demand for $24 billion in unpaid taxes, the bankrupt company said in a court filing, Bloomberg News reported. The two sides will be in court today arguing over the best procedures to determine how much of the Internal Revenue Service claim is legitimate. FTX wants to set a quick schedule to estimate the claim; the IRS has argued that its audit is ongoing, so asking a judge to estimate how much FTX might owe in taxes is inappropriate. Going forward with a court-supervised estimation process will show that FTX lost money in the three-years it operated, so it could not possibly owe IRS any substantial amount, the company said in court papers filed Sunday. And any money that it could be forced to pay would harm victims of FTX, the company said. In court papers, federal officials said they would eventually amend the $24 billion claim to reclassify at least some as lower-priority, unsecured debt. “The government is not looking for a windfall, only to determine the correct amount of the tax liabilities,” federal lawyers said in the filing. Last month, FTX founder Sam Bankman-Fried was convicted of orchestrating a massive fraud that led to the collapse of his FTX exchange. The company filed for bankruptcy last year after Bankman-Fried agreed to turn over control of his empire to restructuring professionals. Since then, the advisers have been tracking down assets and trying to untangle a complex web of debt owed to various creditors, including customers who put cash and crypto on the trading platform.

Private-equity firm GPB Capital Holdings, facing civil fraud allegations since early 2021, will be liquidated by a court-appointed receiver, signaling the end of a long wait for roughly 17,000 investors whose capital has been tied up since at least 2018, the Wall Street Journal reported. Chief Judge Margo Brodie of the U.S. District Court for the Eastern District of New York put GPB under the control of Joseph Gardemal of Alvarez & Marsal, the firm’s court-appointed monitor since February 2021. As its monitor, Gardemal could veto moves by firm managers but had limited power to do more, and for more than a year he has recommended receivership to expedite the return of investor capital. “We are all looking forward to the prompt return of our invested capital,” said Jay Frederick, an investor in Little Rock, Ark. In early 2021, the Securities and Exchange Commission brought fraud charges against GPB involving around $1.7 billion in investments in what New York’s attorney general described as a “Ponzi-like scheme” that used investor funds to cover promised 8% investment returns. The civil complaint followed criminal indictments against GPB’s founder, a senior executive and the firm’s principal marketer in January 2021.

A potential deal to keep SmileDirectClub Inc. afloat has broken down and the once high-flying tooth straightening startup is shutting down, Bloomberg News reported. The publicly traded company, which filed for bankruptcy in late September, had in recent days been negotiating a deal for its founders to provide fresh capital and buy SmileDirectClub out of chapter 11. But the company failed to get its most important lender and other creditors on board, dooming the effort, attorney Spencer Winters said in bankruptcy court Friday. SmileDirectClub sought bidders for the enterprise over the past two months and found some interest, but all suitors dropped out along the way or submitted unworkable bids. The proposed sale to founders took shape only in recent days, but was conditioned on getting the support of lender HPS Investment Partners and lower-ranking creditors, Winters said. “When it came to the founder-led bid, it was really a Hail Mary,” Winters told U.S. Bankruptcy Judge Christopher Lopez. “We pushed very, very hard this week and it just didn’t come together.” SmileDirectClub’s 2019 initial public offering valued the company at $8.9 billion, and made its founders billionaires. It later struggled with declining revenues and never turned a profit. The company ended up marred in a patent fight with a rival, and cut sales and marketing drastically during the pandemic shutdowns.

The push by creditors of Barretts Minerals to move the talc supplier’s chapter 11 case out of the U.S. Bankruptcy Court in Houston was blocked by presiding judge Marvin Isgur, according to a court filing Thursday. The official unsecured creditors committee in November filed a motion seeking to transfer the case from Texas to Montana, noting that Barretts has its headquarters in that state and conducts its primary business of talc mining there. The committee said that Barretts’s only operations in Texas are a single office suite, a processing and transportation facility in Bay City, and a couple of real-estate properties that contain fast-food restaurants. They argued that the company’s choice of filing in Texas amounts to “blatant forum shopping.” Barretts, the former Pfizer minerals business, filed for bankruptcy in October while facing hundreds of personal injury lawsuits alleging that the talc the company supplied for cosmetics products caused exposure to asbestos. In a response to the committee’s motion, Barretts’s chief restructuring officer, David Gordon, said that of the more than 550 pending talc lawsuits against the business, he isn’t aware of any in Montana. In contrast, he said he is aware of at least six lawsuits against Barretts in Texas. He said that Barretts’s decision to file its chapter 11 case in Houston was the result of “careful consideration of a number of factors, including the location of their assets, the logistics of travel for their executives and professionals, and the costs associated with filing in the Southern District of Texas compared to other jurisdictions.”

The Diocese of Sacramento will seek chapter 11 bankruptcy protection after more than 250 lawsuits claiming sexual abuse by clergy and other staff, Bishop Jaime Soto said on Saturday, CBSNews.com reported. Soto said the diocese intends to seek chapter 11 protection by March 2024. "There are many victim-survivors awaiting compensation for the reprehensible sins committed against them," Soto said in a statement to his parishioners. "The diocese faces more than 250 lawsuits alleging sexual abuse by clergy or other church staff. The reorganization process will allow me to equitably respond to the large number of those who are victim-survivors of abuse." A fund would be created to distribute to all victims, the diocese said. "Without such a process, it is likely that diocesan funds would be exhausted by the first cases to proceed to trial, leaving nothing for the many other victim-survivors still waiting for compensation," the diocese said in a statement. Soto announced in March that filing for bankruptcy was a possibility.

Near Intelligence Inc., a publicly traded software firm that provides data insights to major companies including Wendy’s Co. and Ford Motor Co., filed for bankruptcy on Friday with plans to sell itself, Bloomberg News reported. The Pasadena, Calif.-based company listed estimated assets of at least $50 million and liabilities of $100 million, according to court papers. The bankruptcy filing lets Near Intelligence continue operating while it pursues a court-supervised sales process, according to a statement. Blue Torch Capital, a private credit firm that focuses on middle-market companies, has provided an opening offer of at least $50 million for its assets. Blue Torch Finance will lend the company $16 million to help it keep operating, the statement said.

Three years after entering and exiting chapter 11 bankruptcy protection, the Pennsylvania Real Estate Investment Trust may have to do it all over again, The Real Deal reported. The biggest storm cloud hovering over PREIT is $1 billion in credit facilities, primarily held by Wells Fargo. The maturity date on those facilities is Dec. 10 and the company doesn’t have any more options to extend the deadline. This matches the rest of the company’s financial picture. In the third quarter, PREIT posted a net loss of $63.9 million. Same-store net operating income dropped 5.3 percent year-over-year, while core mall total occupancy and core mall non-anchor occupancy also decreased annually.

Mercon Coffee Corp., the bankrupt global coffee trader, must try to negotiate a cheaper way to fund its restructuring case after a U.S. judge rejected a proposed loan from Coöperatieve Rabobank, Bloomberg News reported. Rabobank had agreed to loan Mercon as much as $40 million that would pay about 15% interest, plus an upfront fee of 3% on part of the debt and the payment of $3.8 million in expenses, according to court documents and Bankruptcy Judge Michael E. Wiles. The loan also included provisions that made it likely Mercon would be forced to liquidate instead of being bought or reorganized, Wiles said. “On the whole I don’t think that arrangement is appropriate,” Wiles said during in the company’s first court hearing, which was held by telephone. “It is far too generous.” Mercon will try to negotiate a new deal with Rabobank and present it to Wiles in the next few days, company attorney Paul Keenan said. The company and Rabobank had argued it needed the loan just in case the price of coffee dropped so much that Mercon needed to make multi-million margin calls. The company has at least $12 million in cash in the bank, Keenan said. If the company can come to new terms with Rabobank, it may ask the judge to approve the loan during a rare, weekend court hearing, Keenan said. The company’s cash forecast showed Mercon won’t need any more money for at least the next few weeks, Daniel Rudewicz, a lawyer with the U.S. Trustee said during the hearing. That means the company may not need to borrow any money, Rudewicz said.

A lawyer who is trying to broker a settlement in Johnson & Johnson’s baby powder cancer lawsuits proposed that it can resolve the decade-long litigation and any future cases for $19 billion — $10 billion more than the company offered in two failed trips through bankruptcy court, Bloomberg News reported. James Conlan, a former law firm partner who used to defend J&J against baby powder suits, now runs a business aimed at helping corporations corral liability in mass personal injury litigation. He floated his proposal to J&J’s board in November, according to a court filing unsealed this week. But J&J rejected it and insisted a third chapter 11 filing by one of its units is the best way forward, even though courts previously ruled the world’s largest maker of health-care products wasn’t in enough financial distress to use that process. But Conlan’s proposal — backed by leaders of law firms suing J&J over claims that the talcum in its baby powder contained cancerous asbestos — is the first time plaintiffs have said publicly how much J&J should pay to resolve more than 50,000 cases that have created an overhang on the company’s stock price. Clare Boyle, a J&J spokeswoman, said in a statement that an “improper and unethical collaboration” between Conlan and a plaintiffs’ lawyer “was designed to thwart a reasonable and appropriate resolution of the talc litigation.” J&J contends its talc-based products don’t cause cancer and it has marketed its baby powder appropriately for more than 100 years. Still, the New Brunswick, New Jersey-based company has been moving since 2020 to replace talcum powder in its products with cornstarch.