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Celsius Network LLC customers whose assets have been trapped on the failed crypto lender’s platform questioned the firm’s acting chief executive officer about fluctuations in the company’s native token and its plans to partially repay creditors with stock in a new Bitcoin mining business, Bloomberg News reported. Nearly a dozen customers cross-examined Celsius Interim CEO Chris Ferraro, who testified Tuesday in New York bankruptcy court in support of the company’s plan to partially repay creditors and resolve its chapter 11 case. The hearing gave customers a chance to probe Ferraro, who has guided Celsius through bankruptcy, while their assets remain in limbo. Ferraro, who took over as Celsius’ acting CEO following the resignation of Alex Mashinsky, said his primary goal is to distribute roughly $2 billion in Bitcoin and Ethereum to creditors and transfer the reformulated business to a new management team led by Arrington Capital. Customers on Tuesday also questioned Steven Kokinos, who is expected to become the new company’s CEO. The new creditor-owned firm slated to emerge from Celsius’ bankruptcy has a strong chance at succeeding because it will be staked with $450 million in crypto, carry no debt and run a robust Bitcoin mining operation, Ferraro said.

IronNet, a once-promising cybersecurity startup founded by a former NSA director and funded by cyber and defense investors, has shuttered and laid off its remaining staff following its collapse, TechCrunch.com reported. In a regulatory filing published Friday, IronNet’s president and chief financial officer Cameron Pforr said the company had ceased all business activities as it prepares for chapter 7 bankruptcy, effectively liquidating the company’s remaining assets to pay its remaining debts. The Virginia-based IronNet was founded in 2014 by retired four-star general Keith Alexander, soon after he departed as the former director of the National Security Agency during the biggest leak (at the time) of government secrets by former contractor Edward Snowden. IronNet provided corporations and government agencies with technologies aimed at helping to defend against cyber threats, and using large datasets and analytics to automate threat intelligence. Its other products were designed to protect critical infrastructure.

Bridal dressmaker JLM Couture Inc. has filed for bankruptcy in Delaware — hit hard by the disputes with a landlord and a former designer as well as by the pandemic, WWD reported. Already the company — which makes bridal-related dresses under the Allison Webb, Lazaro, and Hayley Paige brands, among others — had cut back its operations significantly, shifting down from a workforce of 70 in 2020 to 21 employees today. Leading the company was Joseph L. Murphy, who founded JLM in 1988 and became chief executive officer and controlling shareholder in the mid-’90s, according to a declaration that was part of the chapter 11 filings. Murphy said that the company was on the “verge of insolvency” when he took the reins, but that he was able to raise new equity and set up new lines of credit and expand the business. In 2012, JLM expanded the luxury portion of the business, adding the Hayley Paige line as well as a West Hollywood flagship. But the pandemic weighed heavily on the bridal business generally as well as on JLM and by 2021 the relationship with the brand’s designer — Hayley Paige Gutman — had broken down into a nasty legal dispute over Gutman’s use of the Hayley Paige name professionally and access to an Instagram account. While a court largely sided with JLM and Gutman ultimately changed her name to Cheval, the battle weighed on the company. “The debtor’s operations were primarily affected by the active and contentious litigation with one of its former designers,” Murphy said. “The breach of contract by this designer has substantially hurt the company’s sales, and the legacy costs associated with the designer’s operation could not be reduced quickly enough to offset this damage."

Supreme Court justices yesterday appeared skeptical of the payday lending industry's challenge to the Consumer Financial Protection Bureau's funding structure in a case that President Joe Biden's administration has said imperils an agency set up to curb predatory lending after the 2008 global financial crisis, Reuters reported. The justices heard arguments in the administration's appeal of a lower court's ruling that the CFPB's funding mechanism, established when Congress passed Democratic-backed legislation in 2010 creating the agency, violated a constitutional provision giving lawmakers the power of the purse. The agency, which enforces consumer financial laws, draws money each year from the U.S. Federal Reserve rather than budgets passed by Congress. It was the first of several cases the justices are tackling during their new nine-month term, which began on Monday, that could curb the power of federal agencies. Questions posed by the court's three liberal justices and at least two of the six conservative justices — Brett Kavanaugh and Amy Coney Barrett — signaled doubt over the argument by the challengers that the CFPB's funding design violates the U.S. Constitution's "appropriations clause," which vests spending authority in Congress.

Failed crypto lender Celsius Network kicked-off a bankruptcy trial over its plan to restart as a user-owned Bitcoin miner, telling a judge it wants to repay customers whose funds have been frozen on the platform since June 2022 a portion of what they’re owed by year’s end, Bloomberg News reported. Celsius lawyer Christopher S. Koenig said yesterday during a New York bankruptcy hearing that the new company slated to emerge from chapter 11 will be seeded with $450 million in capital and financial backing from a group of companies picked to manage the mining business, a consortium named Fahrenheit LLC that’s led by investment firm Arrington Capital. “Fahrenheit believes in the business,” Koenig said. “They are putting their money where their mouth is.” Judge Martin Glenn is considering whether to approve Celsius’s plan, which is being challenged by some customers whose funds have been locked on the platform. An affiliate of Lantern Ventures that says its owed about $82 million also opposes the plan, arguing Celsius’s advisers have overvalued the new business. The new venture must also be cleared by securities regulators. But if Celsius’s plan is approved, it would mark the first time a failed crypto platform would be reborn in chapter 11 after a string of insolvencies rocked the industry last year. The business could liquidate if the new company fails, an outcome that likely would result in Celsius customers getting repaid less, according to court documents.

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.