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Mississippi Commissioner of Agriculture and Commerce Andy Gipson and representatives with the Mississippi Department of Agriculture and Commerce (MDAC) are scheduled to appear before the U.S. Bankruptcy Court for the Northern District of Mississippi on Jan. 6, 2022, WJTV reported. MDAC leaders will request a pause in Express Grain Terminal’s bankruptcy proceedings while the state agency pursues its investigation. MDAC officials claim Express Grain filed fake financial statements when it applied earlier this year to renew the licenses for its three grain warehouses in Leflore County. Gipson said he wants the opportunity to hold hearings to determine what happened. Express Grain filed for bankruptcy in late September 2021. According to Gipson, the company submitted its license renewal paperwork in May 2021 and June 2021, and officials reported the company was operating profitably. The commissioner stated farmers are owed an estimated $40 million by Express Grain.

The Boy Scouts of America’s bankruptcy plan for resolving 82,200 claims of childhood sexual abuse hinges on promises of legal immunity for the youth group’s partners, affiliates and insurers, similar to the liability releases that have upended the planned reorganization of opioid manufacturer Purdue Pharma LP, WSJ Pro Bankruptcy reported. In a surprise ruling last week, a New York federal judge overturned a $4.5 billion settlement between bankrupt Purdue and its owners, members of the Sackler family. Purdue’s bankruptcy plan included legal releases shielding the Sacklers, who aren’t in bankruptcy, from pending and future lawsuits over opioid addiction, despite objections from a handful of state attorneys general. The ruling, which will be appealed, said that bankruptcy courts have no authority to sign away creditors’ claims against third parties to a chapter 11 case, like the Sacklers. That has implications for the Boy Scouts, a group that is similarly depending on releases for entities that aren’t themselves in bankruptcy to encourage contributions to a settlement fund. The Boy Scouts entered chapter 11 protection last year in the largest-ever bankruptcy filed over childhood sexual abuse. The group has come up with a settlement plan, now nearing $3 billion, that it hopes will allow it to leave bankruptcy, although lawyers on different sides of the issue have given conflicting information on what abuse victims can expect to receive. Abuse survivors have until Dec. 28 to vote on the Boy Scouts’ settlement offer, which if approved in bankruptcy court would resolve all abuse claims, even those from people who voted no on the plan.

The judge who oversaw Hertz Global Holdings Inc.’s chapter 11 restructuring trimmed bondholders’ requests for early repayment premiums and interest payments, saying that some claims aren’t payable under U.S. bankruptcy law or the company’s debt contracts, WSJ Pro Bankruptcy reported. Judge Mary Walrath of the U.S. Bankruptcy Court in Wilmington, Del., said that Hertz’s unsecured bondholders weren’t entitled to collect interest payments at the contractual rate following the rental-car company’s bankruptcy filing last year. The judge also absolved Hertz of any obligation to make premium payments on bonds that were scheduled to come due in 2022 and 2024 to compensate for the early retirement of those debts. These premiums, known as make-wholes, are a common form of protection for creditors, designed to make up for lost interest payments when bonds are redeemed or refinanced ahead of the scheduled maturity. On Hertz bonds maturing in 2026 and 2028, bondholder trustee Wells Fargo Bank NA put forth a viable claim for the premium payments that will require further proceedings to evaluate, the judge said. Whether those make-wholes are in fact due will depend on whether they are the economic equivalent of unmatured interest, which the judge said she couldn’t yet decide on the record before her.

OxyContin maker Purdue Pharma LP spent years building a restructuring plan to settle thousands of lawsuits and deliver funding to combat the opioid crisis. That plan is in limbo after a federal judge ruled that a deal the company struck with its owners isn’t allowed under the law, WSJ Pro Bankruptcy reported. After U.S. District Judge Colleen McMahon’s ruling last week overturning a roughly $4.5 billion settlement between the OxyContin maker and members of the Sackler family who own the company, Purdue, once on the verge of settling an onslaught of lawsuits over its flagship opioid painkiller, will remain in bankruptcy court as it attempts to salvage a settlement that took years and hundreds of millions of dollars to craft. Billions of dollars that Purdue and the family had agreed to pay are now on hold, jeopardizing payouts expected by the people injured by OxyContin overuse and for programs to combat the worsening opioid epidemic. The company so far has spent more than $548 million in fees for lawyers, and other professionals advising the company and creditor groups, according to court papers filed earlier this month. Purdue said in papers filed on Monday in the U.S. Bankruptcy Court in White Plains, N.Y., that although Judge McMahon’s ruling is a “significant setback,” the company believes it has a good chance to win on an appeal.

A group of insurers in the Boy Scouts of America bankruptcy got court approval to delay the start of the hearing on whether to approve the youth group's proposed chapter 11 plan, MarketWatch.com reported. The confirmation hearing will now begin Feb. 22 instead of Jan. 24. The youth group had opposed the delay, saying it would further deplete financial resources that otherwise could go toward sexual abuse survivors. Insurers including Travelers, AIG and Allianz said they needed more time to complete discovery and prepare confirmation objections. Judge Laurie Selber Silverstein in the U.S. Bankruptcy Court in Wilmington, Del., yesterday granted the request, saying several depositions still need to be taken and other work done in an evolving case.

A U.S. bankruptcy judge yesterday approved the $62 million sale of Limetree Bay refinery to a Jamaican oil storage company that intends to restart the refinery, Reuters reported. Private equity investors had poured $4.1 billion into reviving the aging U.S. Virgin Islands facility, which was shut down by U.S. environmental regulators after a botched restart earlier this year. West Indies Petroleum, along with Port Hamilton Refining and Transportation, was named the winning bidder on Saturday by Limetree after a second auction was conducted over the weekend. If the company does not complete the sale in January, the refinery can be purchased by backup bidder St. Croix Energy LLLP, who raised their bid from $20 million to $57 million last weekend. At the refiner's request, Judge David Jones reopened the auction in early December because the chief executive officer of West Indies Petroleum had a medical emergency prior to the first auction. St. Croix Energy objected to the second auction being held. Both West Indies Petroleum and St. Croix Energy want to restart the refinery, which is currently being investigated by the U.S. Department of Justice after releases of hydrogen sulfide and sulfur dioxide during a restart in early 2021 sickened St. Croix residents. The Environmental Protection Agency filed a limited objection on Sunday in order to establish "sale order language" with West Indies Petroleum establishing environmental liability in the refinery's consent decree. The United States also sued Limetree Bay in July seeking injunctive relief under the Clean Air Act that includes requiring the refinery to "eliminate any imminent and substantial endangerment to human health, welfare, and the environment prior to restart of refinery operations."

Sean “Diddy” Combs agreed to pay $7.5 million to buy back the bankrupt fashion brand he founded in 1998 after winning a court supervised auction, Bloomberg News reported. “Seeing how streetwear has evolved to rewrite the rules of fashion and impact culture across categories, I’m ready to reclaim ownership of the brand, build a team of visionary designers and global partners to write the next chapter of Sean John’s legacy,” Combs said in an emailed statement. The label is currently owned by the bankrupt brand manager GBG USA Inc. GBG made 85% of its money by selling clothing and footwear through retailers like Costco, TJ Maxx and Nordstrom, according to court documents. GBG had sold most of its other assets before the Sean John auction. Combs, bidding through an entity called SLC Fashion, agreed to pay $51,000 more than the next highest offer, Before the sale can close, GBG must get approval from the judge overseeing its bankruptcy in Manhattan.

An Aeromexico creditor on Monday objected to the Mexican airline's restructuring plan to emerge from chapter 11 bankruptcy, saying the proposal would unfairly benefit majority shareholder Delta Air Lines Inc., Reuters reported. Invictus Global Management said in a public letter to Delta's board of directors that it opposed the plan put forward by Aeromexico. Aeromexico last week said that an unnamed third party would make a tender offer valuing its outstanding shares at a fraction of their previous market price as part of its efforts to emerge from bankruptcy. Delta's stake would be diluted to 20%, while Apollo Global Management, a fund that often invests in bankrupt companies, would become Aeromexico's biggest shareholder. "Daylight needs to shine on the actions and decisions that could position you to make hundreds of millions of dollars at the expense of other stakeholders, including the many who stand to be economically crushed under the plan preferred by Delta and Apollo," said the letter, signed by Invictus partner Cindy Chen Delano. It added that the proposal included "seemingly egregious financial terms that defy decades of bankruptcy precedent." Invictus is a Delta shareholder as well as a sizeable creditor of Aeromexico, it said.

Non-consensual releases of creditors’ direct claims against a debtor are not permitted by the Bankruptcy Code, according to District Judge Colleen McMahon of Manhattan, who vacated the bankruptcy court’s confirmation of the controversial Purdue Pharma LP chapter 11 plan, according to today's Rochelle's Daily Wire column. Had the reorganization plan been upheld (or if it is upheld after appeal to the Second Circuit), the controlling Sackler family’s $4.325 billion contribution to the reorganization plan would have absolved them from all liability stemming from the opioid crisis, even if creditors with direct claims did not consent. Judge McMahon’s 142-page decision on December 16 is perhaps the most outstanding and remarkable bankruptcy opinion of the decade. Unless reversed on appeal, she will have barred debtors from confirming chapter 11 plans in the Second Circuit with non-consensual releases of creditors’ direct claims against non-debtor third parties. Contrary to what may have been reported in the press, Judge McMahon did not prohibit all non-debtor releases, nor did she bar members of the Sackler family from obtaining releases from perhaps the majority of opioid claims. Judge McMahon’s opinion is narrow. She only barred non-consensual releases where creditors have direct claims against the Sacklers that are not derivative of claims that the company has against family members.