%1

Bed Bath & Beyond Inc. filed for chapter 11 protection yesterday after the home goods retailer failed to secure funds to stay afloat, and has begun a liquidation sale, Reuters reported. The home goods retailer, which shot to popularity in the 1990s as a go-to shopping destination for couples making wedding registries and planning for new babies, has seen demand drop off in recent years as its merchandising strategy to sell more store-branded products flopped. Last year's moves to abandon that strategy, and to bring in more national brands that shoppers recognize, had not shown signs of working, with the company reporting a loss of about $393 million after sales plunged 33% for the quarter ending Nov. 26. The Union, N.J.-based retailer filed for bankruptcy in a District of New Jersey court, listing both its estimated assets and liabilities in the range of $1 billion and $10 billion, according to a court filing. The company said that it has received a commitment of approximately $240 million in debtor-in-possession financing from Sixth Street Specialty Lending Inc., according to a statement. While the retailer has begun a liquidation sale, it intends to use the chapter 11 proceedings to conduct a limited sale and marketing process for some or all of its assets, according to the statement. The company added that its 360 Bed Bath & Beyond and 120 buybuy BABY stores and websites will remain open and continue serving customers as it starts efforts to effect the closure of its retail locations.

The Pill Club, a birth control and telehealth provider backed by an affiliate of venture financing firm TriplePoint Capital LLC, went bankrupt after California authorities accused the startup of fraudulently billing the state’s Medicaid program for contraceptives customers didn’t order and counseling sessions it never provided, Bloomberg News reported. The San Mateo, California-based business is trying to sell itself in chapter 11 as it braces for the possibility that other states will launch additional investigations into its billing practices. The company, also known for a time as Favor, filed bankruptcy months after agreeing to pay a total of $18.275 million to settle California regulators’ claims without admitting wrongdoing. The Pill Club is finalizing an agreement to sell the business in chapter 11, a deal that would be subject to higher offers, company lawyer Timothy Walsh said Friday during a court hearing. Walsh didn’t disclose the name of the potential buyer. The startup is also discussing with TriplePoint and other parties the terms of proposed chapter 11 financing, which could be finalized over the weekend, he said. TriplePoint Venture Growth BDC Corp. is the collateral agent for a $30 million loan to The Pill Club and holds a senior lien on the company’s assets, court papers say. TriplePoint also owns shares in the startup, according to a securities filing. Walsh said The Pill Club and TriplePoint are currently at an impasse over a request to continue using lenders’ cash, though he said the company is hopeful an agreement will be reached soon. TriplePoint did agree to The Pill Club’s use of as much as $850,000 to pay wages for its approximately 220 employees, said Dan McGuire, another lawyer for startup.

Pfizer Inc. has completed its $36.4 million acquisition of assets of Lucira Health Inc., the Emeryville company that filed for bankruptcy protection after developing the first at-home molecular diagnostic test for COVID-19 and recently won approval for a combined COVID-flu test, the San Francisco Business Times reported. Pfizer, the maker of a COVID vaccine and COVID treatment, was chosen last week by Lucira and a committee of creditors over a higher bid by a unit of Aditxt Inc. Lucira and the committee said Pfizer's resources gave it the best ability to not only close the deal but carry on Lucira's product line. The bidding for Lucira's assets pitted Pfizer, the world's largest drug maker by revenue with nearly $23 billion in cash, equivalents and short-term investments, against the Pearsanta unit of immune system-focused Aditxt, which had to borrow $1 million to make the deposit to participate in the auction. Pfizer's bid consisted of $5 million cash and more than $20 million to cure various Lucira contracts and another $11 million for the manufacturer of the test kits, Jabil Inc. If the total cures come in under the $20 million mark, the difference will go to the Lucira estate.

Failed crypto lender Celsius Network Ltd. has attracted two new bidders in a three-way auction set for Tuesday, according to a Saturday filing by Kirkland & Ellis, which is overseeing the bankruptcy, Bloomberg News reported. Joining an earlier bid by NovaWulf Digital Management to manage a restructured version of the bankrupt cryptocurrency company are Fahrenheit LLC, a consortium backed by Techcrunch Inc. founder Michael Arrington, and Blockchain Recovery Investment Committee, backed by Gemini Trust, run by the Winklevoss twins, and exchange-traded fund manager Van Eck Absolute Return Advisers Corporation. Meanwhile, the official committee of Celsius creditors won court approval on April 18 to assert claims including fraud and negligent misrepresentation against the failed crypto lender on behalf of its account holders. Allegations of fraud and misrepresentation have plagued Celsius since it filed for bankruptcy with a $1.19 billion deficit in July. The company made false statements publicly that signaled keeping money with Celsius was safer than that of a bank, Aaron Colodny, a lawyer representing the official unsecured creditor’s committee, said during the April 18 hearing.

A bankruptcy judge has again shielded Johnson & Johnson from jury trials in roughly 40,000 pending talc-related lawsuits, advancing the company’s second attempt to resolve mass cancer claims through the chapter 11 system, though he cautioned J&J faces an “uphill battle” ahead, WSJ Pro Bankruptcy reported. Judge Michael Kaplan of the U.S. Bankruptcy Court in Trenton, N.J., on Thursday extended to the healthcare-products company the same protection against talc-related trials enjoyed by its subsidiary LTL Management LLC, a vehicle created by J&J to carry its talc-related liabilities into chapter 11. The freeze on jury trials will last through mid-June while LTL moves through bankruptcy, Judge Kaplan said. His ruling marks the second time he has frozen jury trials in tort litigation alleging that J&J’s talc products cause cancer, which the company denies. The judge granted similar protections to J&J after LTL’s initial entry into chapter 11 in 2021 to give the company breathing room to negotiate with talc claimants and their lawyers on a settlement plan. A federal appeals court threw out that bankruptcy case this month, but LTL filed for bankruptcy again hours later, this time with a settlement offer supported by some plaintiffs’ law firms. That offer, valued at $8.9 billion, would rank among the largest tort settlements ever if accepted.

BlockFi was granted more time to file a bankruptcy exit strategy on Wednesday, some five months after the crypto lender went bust, BlockWorks.co reported. Joshua Sussberg, BlockFi’s attorney, said the company is exploring potential sale of its assets at a recent hearing. The firm is also looking for an external backer for a potential restructuring deal. The company now has until May 15 to file an exit plan, per court docs. Judge Michael Kaplan reportedly said it was worth extending the deadline to ease the way for a smooth continuation of the case. Sussberg described the duration of the extension as “modest,” and said the company would have a plan ready for assessment by unsecured creditors within two weeks. BlockFi filed for bankruptcy on Nov. 28, shortly after its bailout partner FTX. Under bankruptcy code, debtors are ideally meant to propose a chapter 11 plan in the first 120 days of the filing. This meant BlockFi should have presented a plan by March 27. But on March 21, the company filed a motion to extend the deadline for its chapter 11 plan by 90 days to June 26. “Given the size and complexity of these chapter 11 cases, much work remains,” BlockFi’s lawyers said. It’s estimated BlockFi altogether owes more than 100,000 creditors up to $10 billion.

The U.S. government reached an agreement with Voyager Digital Ltd. allowing the bankrupt cryptocurrency platform to sell its user accounts to Binance.US, meaning Voyager customers will be able to access their funds again, WSJ Pro Bankruptcy reported. Federal authorities have agreed to allow a key part of Voyager’s chapter 11 plan—the transfer of customer accounts to Binance.US—to go ahead while a related government appeal of a narrow provision in Voyager’s reorganization continues, according to court papers filed Wednesday. Various state and federal regulators including the Securities and Exchange Commission opposed the Binance.US deal, which was approved in bankruptcy court only to be put on hold by appellate judges. The government has said a provision in Voyager’s chapter 11 plan could tie regulators’ hands in taking future enforcement actions against the parties involved in distributing its cryptocurrency. Voyager has said the provision is necessary to protect those involved in implementing the court-approved chapter 11 plan.

A former US Secret Service agent who specializes in probing financial cybercrime supported anonymity for creditors in the FTX bankruptcy because of risks from the criminals who stalk the cryptocurrency sector, Bloomberg News reported. Identifying customers of the fallen crypto exchange “imposes a severe and unusual risk of identity theft, asset theft, personal attack, and further online victimization,” Jeremy A. Sheridan, managing director in the blockchain and digital assets practice of FTI Consulting Inc., said in a filing on Thursday. FTI Consulting is the financial adviser for the official committee of unsecured creditors in the five-month-old FTX bankruptcy. Early in the case a judge agreed to keep the names of the 50 biggest unsecured creditors secret. The US Bankruptcy Code normally requires the names be filed in public documents. The U.S. Trustee and several media companies, including Bloomberg News, unsuccessfully fought to have the names of FTX customers made public earlier this year, arguing that their names would be listed if they were creditors in any other bankruptcy case. Naming customers with bigger crypto holdings is like “placing a target on their back and facilitating fraudulent schemes by malefactors,” Sheridan said.

Beverly Hospital filed for bankruptcy on Wednesday, a step that hospital officials said was needed to avoid the closure of the Montebello facility, the Los Angeles Times reported. Hospital officials said their goal is to find a buyer to keep the hospital open and maintain crucial services for residents in Montebello and nearby communities, including El Monte, Whittier and East Los Angeles. They laid the blame for their financial plight on surging costs that they said had outpaced government reimbursements to care for low-income patients. “The need to restructure is regrettable, but to save the hospital, we were forced to take these necessary steps,” Beverly Hospital President and Chief Executive Alice Cheng said in a statement announcing that the facility had filed voluntary petitions for Chapter 11 under the bankruptcy code. “It’s a sad situation, but it’s essential for us to continue to provide healthcare for the people of our community.” Hospital officials said they had secured up to $13 million in financing to enable the hospital to keep operating without interruption as it pursues options for a sale, aiming to find a buyer “who can ensure the longevity of the hospital so that it can continue to serve the communities that need it the most.”

Richard Branson's Virgin Orbit Holdings Inc and its subsidiaries in the United States filed a chapter 11 bankruptcy plan with the U.S. Bankruptcy Court for the District of Delaware, the company said in a statement on Wednesday, Reuters reported. Earlier this month, Virgin Orbit filed for chapter 11 bankruptcy protection after the satellite launch company struggled to secure long-term funding following a failed launch in January. On Wednesday, the company proposed a May 4 deadline for indications of interest for its assets, asking the court to approve bid procedures including interest deadlines, and a bid deadline of May 14, 2023, it said in the statement. "We expect the filing of the plan and disclosure statement will help us to efficiently conclude the Chapter 11 process once we have completed the sale of the company," Dan Hart, chief executive of Virgin Orbit said in the statement. The company is seeking the sale of its assets, after laying off roughly 85% of its 750 employees.