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McKinsey & Co. will pay $45 million to settle an investigation by Nevada of the big consulting firm’s role in fueling the U.S. opioid epidemic, Reuters reported. Nevada had been the lone holdout among U.S. states investigating McKinsey’s conduct, and Monday’s settlement boosts the firm’s payout for opioid settlements to about $641 million. McKinsey had in early February reached a $573 million settlement with 47 U.S. states, the District of Columbia and five U.S. territories, plus $23 million of settlements with Washington state and West Virginia. A McKinsey spokesman said the firm did not admit wrongdoing or liability, believes its past work was lawful and has denied contrary allegations. The settlements came after lawsuits showed how McKinsey advised drug manufacturers, including Purdue Pharma, which makes OxyContin, on how to market opioids, including by targeting high-volume prescribers.

Chicago community leaders sought to delay the planned sale of Mercy Hospital and Medical Center to biomedical company Insight, using a virtual state hearing to urge a sale to a partnership formed by a Black physicians’ group and a local hospital, Bloomberg News reported. State representative Lamont Robinson asked the Illinois Health Facilities & Services Review Board to allow a sale to the physicians and Humboldt Park Health, formerly known as Norwegian American Hospital. Humboldt’s population has similar needs and its CEO has transformed it, said Robinson, who represents Mercy’s district. “We need a local organization that understands our community,” he said. At issue is the survival and ownership of Mercy, which filed for bankruptcy last month after the state rejected its plans to shutter. Owner Trinity Health Corp. agreed to sell the facility for $1 to Insight. Alderman Sophia King said that there are a number of interested buyers including local hospitals. Community leaders said they’d met with some prospective buyers. Backers of selling to Insight included officials from the company’s Flint, Mich. hometown and some Mercy physicians, though others were opposed.

Mall owner CBL & Associates Properties Inc. reached a truce with bank lenders led by Wells Fargo Bank NA, agreeing to a restructuring proposal that will end negotiations that started months before the company filed for bankruptcy, WSJ Pro Bankruptcy reported. CBL, one of the largest mall owners in the U.S., filed for bankruptcy in November with $4 billion in debt. Under the chapter 11 plan unveiled yesterday, Wells Fargo and other banks owed more than $980 million would walk away with $100 million in cash and more than $880 million in new loans. Bondholders would receive an 89% stake in the reorganized company, $555 million in new secured notes and $95 million in cash. If approved in the U.S. Bankruptcy Court in Houston, the restructuring proposal would eliminate CBL’s $1.6 billion in debt and preferred obligations and slash the company’s interest expenses.

Washington Prime Group Inc., the owner of a nationwide group of shopping malls reeling from the pandemic, approached investors to sound out early interest in providing bankruptcy financing as it prepares to file for chapter 11, Bloomberg News reported. Guggenheim, the company’s investment bank, has asked prospective lenders to indicate their interest in providing a potential $150 million debtor-in-possession loan. The real estate investment trust, which owns about 100 malls throughout the U.S., acknowledged that it may have to file for court protection from creditors amid “substantial doubt” about its ability to keep operating. Bloomberg News previously reported that Washington Prime was contemplating bankruptcy. The mall owner’s bankruptcy plans are not yet final and the discussions around the financing could change. Washington Prime is under forbearance with creditors until March 31 after missing a Feb. 15 interest payment. It remains in talks with creditors around a financial restructuring, according to an earnings statement released Wednesday.

Investors will recover less than half of what they put into a collection of Northern California apartment buildings, office parks and other real estate without realizing the business that owned them was running as a Ponzi scheme, according to bankruptcy professionals who took it over after its founder’s death, WSJ Pro Bankruptcy reported. The management of Professional Financial Investors Inc. filed court papers on Sunday outlining a chapter 11 plan that proposes to sell or operate properties and pursue lawsuits to recover as much as possible for creditors owed more than $675 million. The bankruptcy professionals want the U.S. Bankruptcy Court in San Francisco to aid the cleanup process by making a formal declaration that Professional Financial was a Ponzi scheme as far back as 2007. The company owes at least $237 million to individuals who bought debt instruments it issued, and they aren’t the only creditors. JPMorgan Chase & Co. and other bank lenders are first in line to be repaid, secured by top priority on deeds of trust at dozens of properties. Other investors can expect to recover from 35% to 50% of the money they put into Professional Financial, according to court papers. The chapter 11 plan is backed by formal and informal groups of investors who have been on the scene since July 2020, when the business began to fall apart after the death of its founder, Kenneth Casey.

Congressional Democrats are seeking to prevent members of the Sackler family who own OxyContin maker Purdue Pharma LP from using the drug company’s bankruptcy to get legal releases freeing them from government lawsuits over the opioid painkiller, WSJ Pro Bankruptcy reported. Rep. Carolyn B. Maloney (D-N.Y.), chairwoman of the House Committee on Oversight and Reform, and senior committee member Rep. Mark DeSaulnier (D-Calif.) introduced a bill on Friday specifying that bankruptcy judges cannot release legal claims brought by states, tribes, municipalities or the U.S. government against a bankrupt company’s owners, like the Sacklers, or its directors, officers or other third parties with ties to a chapter 11 case. The legislative proposal comes after the Sacklers offered to pay $4.28 billion over the next decade in exchange for legal releases that would resolve lawsuits accusing Purdue of helping fuel the opioid epidemic. The settlement offer is part of a larger multibillion-dollar reorganization plan designed to get Purdue out of chapter 11. Attorneys general from 24 states plus Washington, D.C., have come out against Purdue’s plan and have demanded greater transparency and more upfront money from the Sacklers.

The Blackjewel coal mining company can walk away from cleaning up and reclaiming coal mines covered by more than 30 permits in Kentucky under a liquidation agreement reached Friday in federal bankruptcy court in Charleston, West Virginia, the Louisville Courier Journal reported. About 170 other Blackjewel permits in Kentucky, Tennessee, Virginia and West Virginia will be placed into legal limbo for six months while Blackjewel attempts to sell them to other coal mining companies, attorneys said. Any permits that are unable to be transferred can then also be abandoned by the company, once the nation’s sixth-largest coal producer. The Kentucky Energy and Environment Cabinet was preparing a written statement on the decision late Friday but a spokesman said it was not immediately available and declined to comment. Thousands of acres of mountainous land in Kentucky alone have been disturbed by strip mining allowed by the permits that were before the judge. Both the state and the companies that issued bonds guaranteeing clean-up and reclamation of the dynamite-blasted landscapes had warned in court proceedings that there might not be enough money to do all the required work.

Goldman Sachs Group Inc. auctioned off around $53 million of claims it held against a bankrupt Texas power cooperative as distressed debt traders bet the government will foot the bill for the state’s energy crisis, Bloomberg News reported. Goldman sold its claim on Brazos Electric Power Cooperative Inc. this week at 80 to 85 cents on the dollar, said the people, who asked not to be identified because details of the auction are private. The bank is one of Brazos’s largest unsecured creditors. It’s owed the money for interest rate swaps and other power derivatives contracts that its commodities trading unit J. Aron & Co. signed with Brazos before a winter storm in February upended the Texas power market, saddling the electricity provider with billions in liabilities it couldn’t repay.

Tens of thousands of borrowers who attended for-profit schools like Corinthian Colleges and ITT Technical Institute that defrauded students will have their student loan debts eliminated after the Education Department rescinded some changes made during the Trump administration that gutted a relief program, the New York Times reported. “Borrowers deserve a simplified and fair path to relief when they have been harmed by their institution’s misconduct,” said Miguel Cardona, the education secretary. “We will grant them a fresh start from their debt.” The change will eliminate around $1 billion in student loan debt owed by around 72,000 borrowers, the department said. Most of them attended ITT and Corinthian, institutions that abruptly shut down years ago. The relief program, known as borrower defense, allows those who can demonstrate that they were substantially misled by their school to have their federal student loans forgiven. Once little-used, the system was flooded with claims during the Obama administration after a series of large for-profit chains collapsed following a government crackdown on schools that saddled their students with high debts for a low-quality education. For a time, the department granted any borrower with an approved claim a full discharge of their debts. But that changed under Betsy DeVos, the previous education secretary, who described the program as a “free money” giveaway. In 2019, DeVos imposed a complicated new methodology that led to only partial relief for many successful applicants. Some whose claims were approved were told they would get $0 in relief. Cardona said the department will abandon DeVos’s methodology and retroactively give those with approved claims a full discharge.

Neiman Marcus Holding Company Inc. launched a junk-bond sale on Thursday to refinance debt taken out to emerge from bankruptcy, marking the retailer’s return to the capital markets just six months after exiting from chapter 11, Bloomberg News. The troubled upscale department store is marketing a $1 billion five-year first lien bond. An investor call is scheduled for 11 a.m. New York time, with pricing expected on Friday. Proceeds will pay down the $125 million first-in, last-out facility and repay the roughly $748 million exit term loan and notes due 2025, resulting in a “modest” reduction in interest expenses, according to a report Thursday morning by S&P Global Ratings. Early pricing discussions are for a yield in the mid-to-high 7% range.