%1

The developer of “League of Legends,” one of the world’s most popular videogames, wants to end a lucrative sponsorship deal with FTX, saying its association with the bankrupt cryptocurrency exchange is damaging its brand and potentially hurting its upcoming competitive season due to the uncertainty of the funding, WSJ Pro Bankruptcy reported. Riot Games Inc. said in papers filed on Friday with the U.S. Bankruptcy Court in Wilmington, Del., that it doesn’t have time to replace FTX as a sponsor for the 2023 League of Legends competitive season, but wants to end the sponsorship as soon as possible so it can find a new cryptocurrency exchange partner. The League of Legends esports league boasts the third most-watched professional sport in the world among males between 18 and 34 years old, behind only the National Football League and National Basketball Association, Riot said in the filing. The FTX sponsorship was the largest Riot had ever signed for an esport league and represented a critical funding source for compensating its teams, the company said. FTX paid Riot $4 million in 2021 and agreed to pay the videogame maker $12.5 million in 2022 and roughly $12.88 million in 2023, according to a partially redacted copy of the agreement filed in bankruptcy court.

FTX’s U.S. managers are negotiating with Bahamian authorities to resolve a dispute over access to the failed crypto exchange’s electronic records, lawyers said in a court hearing Friday, following weeks of publicly criticizing each other over the handling of FTX’s collapse, WSJ Pro Bankruptcy reported. FTX Chief Executive John J. Ray III and company lawyers met in New York on Thursday with representatives of the Securities Commission of the Bahamas and Bahamian court-appointed liquidators to try to resolve a dispute over sharing information from inside the exchange that is relevant to their investigative work. “While we haven’t come to any conclusions, we did have a productive exchange of views,” FTX lawyer James Bromley said during a hearing in the U.S. Bankruptcy Court in Wilmington, Del. The Bahamian liquidators have sought access to data from FTX’s international trading platform, email records from employees of FTX’s Bahamas affiliate, FTX Digital Markets Ltd., employee Slack chat records, documents stored on a shared company Google Drive and FTX’s QuickBooks accounting system, according to court papers. Their access to the information was cut off by FTX’s U.S. management on Nov. 12, a day after FTX filed for chapter 11, according to their court filings.

Former FTX Chief Executive Sam Bankman-Fried is expected to appear in court in the Bahamas today to reverse his decision to contest extradition to the United States, where he faces fraud charges, Reuters reported. The 30-year-old cryptocurrency mogul was indicted in federal court in Manhattan on Tuesday and accused of engaging in a scheme to defraud FTX customers by using billions of dollars in stolen deposits to pay for expenses and debts and to make investments for his crypto hedge fund, Alameda Research LLC. His decision to consent to extradition would pave the way for him to appear in U.S. court to face wire fraud, money laundering and campaign finance charges. Upon arrival in the United States, Bankman-Fried would likely be held at the Metropolitan Detention Center in Brooklyn, though some federal defendants are being held at jails just outside New York City due to overcrowding at the facility, said defense lawyer Zachary Margulis-Ohnuma. At his initial court hearing in Manhattan, Bankman-Fried would be asked to enter a plea and a judge would make a determination on bail, Margulis-Ohnuma said. The attorney added that such a hearing must take place within 48 hours of Bankman-Fried's arrival in the United States, though it would likely be sooner. Prosecutors will likely argue that Bankman-Fried is a flight risk and should remain in custody because of the large sums of money involved in the case and the unclear location of those funds.

Attorneys for the U.S. bankruptcy trustee in Delaware and several major media outlets are challenging an effort by cryptocurrency exchange FTX to withhold names of the company’s customers and creditors from the public, the Associated Press reported. At a brief hearing Friday, the judge presiding over the FTX bankruptcy granted a motion by media outlets to intervene for the purpose of objecting to the sealing of creditor information. A separate objection by the U.S. trustee, the government watchdog that oversees chapter 11 reorganizations, also was on the agenda for Friday’s hearing but was postponed by Bankruptcy Judge John Dorsey until Jan. 11, when he likely will also hear arguments from the media. In a court filing earlier this week, an attorney for Delaware’s acting U.S. trustee noted that “disclosure is a basic premise of bankruptcy law.” “The debtors simply cannot seek bankruptcy protection and then do business behind a shield of secrecy” Juliet Sarkessian wrote. Sarkessian warned that allowing FTX to shield creditor lists and financial schedules would be a “slippery slope” and create an unfavorable precedent for bankruptcies in which creditors are also customers. Last month, Judge Dorsey temporarily granted a request by FTX to redact the names and addresses of clients and creditors from court filings, even though such information is typically public. The judge did direct FTX to file an unredacted creditor matrix under seal with the court, but the company has yet to do so.

U.S. midstream infrastructure company Tallgrass said on Friday that it had reached an agreement to acquire Houston-based Ruby Pipeline, which has been under chapter 11 protection since March, Natural Gas World reported. The transaction, the value of which was not disclosed, is expected to close in Q1 2023, subject to customary regulatory approvals and closing conditions. Ruby is a 1.5bn ft3/day, 680-mile pipeline between Opal, Wyoming and Malin, Oregon. It was placed under bankruptcy protection by its joint venture owners, Kinder Morgan and Canada’s Pembina Pipeline, in March. In November, Pembina Pipeline said it had reached a settlement agreement with Ruby that provided for the release of Pembina from any causes of action that might arise from the bankruptcy proceeding. Pembina agreed to a US$102mn payment to Ruby but retains all its recovery rights as a creditor. Ruby, Tallgrass said, offers a “unique opportunity” to advance its initiatives to offer decarbonised energy solutions such as responsibly sourced and renewable natural gas to customers across the U.S.

Puerto Rico’s financial oversight board filed a plan to restructure about $9 billion of power utility debt after failing to reach a deal with bondholders, signaling the agency’s five-year bankruptcy will take even longer to resolve, Bloomberg News reported. The federal board is overseeing the island’s finances and the debt proposals for Puerto Rico’s Electric Power Authority, known as Prepa, the main supplier of electricity on the island. The board wants to slash nearly 40% of Prepa’s debt — $8.5 billion in bonds and another $700 million in loans to fuel-line lenders — down to a combined $5.4 billion of new restructured securities, according to the debt adjustment plan submitted to the bankruptcy court Friday night. Court-ordered mediation between the board, insurance companies and an ad hoc group of bondholders has so far failed to produce a consensual repayment plan. At the same time, the parties are litigating whether bondholders are entitled to Prepa’s future revenue or limited to accounts holding about $16 million.

A federal judge approved a bankruptcy settlement of about $100 million Friday over Carolina Panthers owner David Tepper’s failed plan to build a practice facility for his NFL team in South Carolina, the Associated Press reported. The deal will turn the land and the incomplete steel shell of what was supposed to have been the team’s new headquarters over to the city of Rock Hill. It’s estimated to be worth $20 million. Tepper’s real estate company GT Real Estate Holdings will pay York County, which provided sales tax revenue for road improvements, $21 million, and $60 million will be split among the contractors who worked on the project before it was abandoned earlier this year. All sides agreed to drop their current lawsuits and not file any other claims as part of the deal approved on Friday by Bankruptcy Judge Karen Owens. Tepper, a hedge fund manager who is one of the NFL’s wealthiest owners, and the Panthers announced plans for an $800 million practice facility, team offices, sports medicine complex, hotels and entertainment near Rock Hill in 2019. Both local and South Carolina leaders cheered the investment, offering incentives and relishing getting a piece of the NFL team away from North Carolina and Charlotte, where the team plays its games about 25 miles (40 kilometers) away. But after less than two years, Tepper’s company abruptly stopped work. York County Sheriff Kevin Tolson and Solicitor Kevin Brackett continue to investigate Tepper and his company to see whether public money was misused on the project. York County, which is separate from the sheriff, released a statement after reaching its deal with Tepper that said Tepper and his company “have acted in good faith and that the county “believes that no action of any kind with respect to the county payment is warranted.”

Avaya Holdings Corp. is nearing a chapter 11 bankruptcy filing to restructure its balance sheet as it looks to turn around its business and move past problems surrounding the company’s accounting, the Wall Street Journal reported. Avaya disclosed earlier this week it has reviewed various restructuring proposals from competing creditor groups. One plan, supported by a senior lender group including Apollo Global Management, would significantly reduce Avaya’s debt load through chapter 11, wipe out shareholders and, pending the completion of an internal investigation into controls over financial reporting, provide directors and executives with releases from potential litigation. In August, Avaya said it had launched an investigation while it was “reviewing matters related to potential material weaknesses in the company’s internal control over financial reporting.” Another plan, supported by holders of Avaya’s unsecured bonds, proposes to restructure the company out of court, including by issuing new bonds and loans to retire some old debt. The company in August said there was substantial doubt about its ability to continue as a going concern in light of a debt maturity next year, and disclosed it would miss its third-quarter earnings forecast by more than 60% after closing a deal to issue $600 million of new debt in June. Prices on the newly issued debt tumbled after the disclosure about the earnings, saddling investors with losses.

Core Scientific — one of the largest publicly-traded crypto miners — soared more than 70% early Thursday after B. Riley offered $72 million in fresh financing, the Wall Street Journal reported. The bitcoin miner has suffered from this year's crypto rout as well as high electricity prices. It suspended payments to lenders in late October and suggested bankruptcy as an option. One of its largest creditors, B. Riley, wrote an open letter to the firm on Wednesday suggesting it was willing to give Core Scientific $40 million immediately, and an additional $32 million following stipulations that included the price of bitcoin rising above $18,500. As of Thursday, it traded at $17,475. B. Riley's outstanding loan was set to mature this December. The beleaguered miner is still down 96% on the year. It counts BlockFi Lending LLC — a bankrupt crypto firm caught up in the FTX scandal — as another one of its creditors, according to FactSet.