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HighPoint Resources Corp. filed for bankruptcy, setting in train a process that will result in the Denver-based shale oil producer being acquired by Bonanza Creek Energy Inc., Bloomberg News reported. The driller filed a chapter 11 petition in U.S. Bankruptcy Court in Delaware, indicating its estimated liabilities to be up to $1 billion. Yesterday’s filing comes two days after shareholders of HighPoint and Bonanza approved plans for the companies to merge as part of a prepackaged debt restructuring agreement. Bonanza’s stock tumbled 12% last week, paring its gains this year to 81%. HighPoint operates in the Denver-Julesburg Basin of Colorado and Wyoming, a shale play that has seen more than three-quarters of its drilling rigs idled, according to Baker Hughes Co. Deutsche Bank AG was listed as HighPoint’s largest creditor with claims unsecured by collateral of $641 million.

The trustee overseeing Ruby’s Diner Inc.’s chapter 7 proceedings is suing the chain’s co-founders and former officers in Santa Ana, alleging the pair drove the restaurant group into bankruptcy after improperly taking the company’s assets and seeking at least $35 million in damages, MyNewsLA.com reported. The complaint, filed on Thursday in federal bankruptcy court by trustee Richard Marshack, alleges the chain’s insolvency was caused by Douglas Cavanaugh and Ralph Kosmides due to a series of improper decisions. According to the suit, RDI owned and operated the Ruby’s Diner restaurant chain, which Cavanaugh and Kosmides started in Newport Beach in 1982 and grew to include over 40 locations. The company declared bankruptcy in 2018 when it owed over $14 million to its creditors, the suit says. The lawsuit alleges RDI’s insolvency was due to a series of decisions by which Cavanaugh and Kosmides improperly enriched themselves at the expense of the company. Marshack claims that the co-founders used Ruby’s name, expertise, funds and personnel to obtain a lucrative opportunity from the state of California to develop two highly successful restaurants in Crystal Cove State Park: The Beachcomber and The Shake Shack.

People looking to file a claim seeking damages for clergy sex abuse against the Roman Catholic Diocese of Syracuse must do so by midnight on April 15, Syracuse.com reported. The diocese issued a reminder of that deadline, known as the “bar date,” in a news release Sunday. The deadline was initially set in November 2020 by U.S. Bankruptcy Court Judge Margaret Cangilos- Ruiz. The diocese filed for chapter 11 bankruptcy in the Northern District of New York in June 2020. That move immediately shifted all abuse claims from state court to bankruptcy court. At the time, there were more than 100 claims of abuse against the Syracuse diocese. The bankruptcy filing came just days after 38 people filed Child Victims Act lawsuits against the church. Under the judge’s order, those with claims must file them by April 15 or risk losing their rights as potential creditors to vote in the diocese’s financial reorganization and any shares in the settlement made to victims.

Members of the Sackler family who own Purdue Pharma LP have offered roughly $4.3 billion to resolve sprawling opioid litigation, up from $3 billion initially proposed in settlement discussions underway in the OxyContin maker’s bankruptcy proceedings, Reuters reported. Sackler family members are now willing to contribute $4.275 billion to help settle about 3,000 lawsuits brought by U.S. communities seeking to hold them and Purdue responsible for damage wrought by the opioid epidemic. Details of a far-reaching settlement could be outlined in a Purdue reorganization plan filed in a U.S. bankruptcy court next week. Purdue filed for bankruptcy in 2019 facing on onslaught of opioid litigation. In November, the Stamford, Connecticut-based company pleaded guilty to three felonies arising from its marketing of prescription opioid painkillers. A previous proposed settlement that Purdue values at more than $10 billion guaranteed $3 billion from the Sacklers over seven years, with additional funds from family members contingent on sales of other international businesses they own. That offer as a practical matter decreased to $2.775 billion after the Sacklers agreed to pay $225 million to settle a Justice Department civil probe. Under terms of the latest proposal, the Sacklers could still use proceeds from sales of those businesses to cover the higher $4.275 billion payout, but would need to make good on it regardless. It is not clear how long the Sacklers would take to pay the proposed higher amount, but it would likely be a period of years.

The bankrupt Fairmont San Jose hotel in Silicon Valley reached a restructuring deal with secured lender Colony Credit Real Estate Inc. and said it hopes to rebrand as a Signia Hilton, JW Marriott or Grand Hyatt, WSJ Pro Bankruptcy reported. A two-tower, 20-story and 805-room luxury hotel that has frequently hosted technology conferences, the Fairmont San Jose is the latest lodging property to file for bankruptcy as a result of a downturn in business during the coronavirus pandemic. The owners of the hotel closed the property earlier this month amid a fight with Fairmont, which managed the hotel. The chapter 11 filing in the U.S. Bankruptcy Court in Wilmington, Del., lists roughly $185 million in debt, nearly all of it owed to publicly traded real-estate investment trust Colony Credit. Colony Credit is managed by publicly traded investment firm Colony Capital Inc., which also owns roughly a third of the REIT. Though normally a profitable property, the privately owned hotel said its average occupancy rate during the pandemic has been 8%. Conventions and other events, usually major revenue generators, currently aren’t being scheduled, it said. Losses last year exceeded $18.6 million and are projected to surpass $18.8 million this year, the hotel said. The business said in a court filing that it asked whether Fairmont was willing to provide financing to help get the hotel through the pandemic. Fairmont declined, but at the same time has fought efforts to end its management contract or take its name off the hotel, which opened in 1987 and was expanded in 2002, the filing said.

Roughly 400 people who allege that they were sexually preyed upon by local priests and deacons went to bankruptcy court and sought compensation from the Archdiocese of New Orleans before last week’s deadline for victims of clerical abuse to file such claims, church officials said yesterday, NOLA.com reported. The announcement provides clarity as to the number and potential value of remaining clerical abuse cases that the archdiocese will have to settle or litigate before it can reorganize its finances, a process that started when the church filed for chapter 11 bankruptcy last May. March 1 was the final day a sexual abuse claim could be filed in the case, which is the only avenue for compensation for those claiming they were molested prior to the bankruptcy filing. Whoever had such claims but didn’t pursue compensation by the deadline has forever lost the right to do so. Plaintiffs’ attorney Jeff Anderson, who has represented abuse claimants against virtually all of the 27 U.S. Catholic dioceses that have declared bankruptcy, said he believes 400 claims is relatively low for the church in New Orleans, given that the archdiocese serves about a half-million parishioners and currently has a list of more than 70 clergy who have been credibly accused of sexually molesting children or vulnerable adults. For the sake of comparison, the Diocese of Buffalo filed for bankruptcy last February and the court has given claimants until August of this year to file, eight months more than New Orleans claimants received. The Buffalo diocese, which serves about 700,000 Catholics, estimates it will end up receiving 400 abuse claims, but it’s impossible to know if that will prove anywhere near accurate.

Texas lawmakers yesterday found themselves on the horns of a power market dilemma: expect lawsuits from utilities and traders if they retroactively cut cold-snap electricity prices, or “cascading bankruptcies” if they do not, Reuters reported. The state’s grid operator sharply hiked power prices during a February freeze, pushing two power companies into bankruptcy and prompting others to default on bills. Officials this week called for regulator Public Utility Commission (PUC) of Texas to immediately reduce about $16 billion in power prices. But PUC Chairman Arthur D’Andrea told lawmakers at a hearing in Austin that any repricing would trigger lawsuits the state could lose. Commodity contracts used to hedge power have closed and any repricing “will have consequences” for the state’s power, agriculture and other markets, he said. The state independent market adviser testified the PUC can cut spot market prices over the final hours of the crisis and claw back fees for services not provided. The two would eliminate $5.1 billion in costs from those most affected, said adviser Carrie Bivens. The $16 billion figure was the potential cost of all power sold at a $9,000 per megawatt hour spot price that officials set to induce more generation. However on Thursday, she said the money that changed hands at the high price was much less because some companies had fixed-price contracts or both supply and purchase power.

Real estate and co-working startup Knotel has secured court approval of a deal with its prospective buyer and junior creditors that it hopes will pave its way out of bankruptcy, Reuters reported. During a remote hearing yesterday, U.S. Bankruptcy Judge Mary Walrath, Delaware signed off on the settlement that provides unsecured creditors up to $6.2 million if Digiatech LLC, Knotel’s lender and likely buyer, is the winning bidder at an auction scheduled for Friday. The deal firms up key support from junior creditors for Knotel’s goal of conducting a quick sale process before its financing runs out.

If Citigroup Inc.’s accidental $900 million payment to Revlon Inc. lenders strained the bank’s relationship with the cosmetics giant, you wouldn’t know it: The two continue to do business together, Bloomberg News reported. The makeup company worked with Citigroup as recently as this week to close an amendment to its revolving credit line, Revlon said in fourth-quarter results Thursday. That’s after Citigroup made the infamous payment error in August and recently stepped in as a Revlon creditor, forcing the bank to revise its results last month after it wrote down a portion of Revlon’s loan. The bank had served as Revlon’s loan administrative agent on previous deals, collecting and distributing interest payments and providing other housekeeping services. Citigroup facilitated debt deals that left a group of Revlon lenders fuming, then accidentally sent those firms hundreds of millions of dollars it then asked to be returned. The money came from Citi’s accounts, and did not impact Revlon’s existing loan. News the companies have maintained their relationship comes as Revlon reported results for the critical holiday quarter. Although sales have fallen for three straight years — a combination of changing consumer habits, rising competition from startups with strong social media presence and the COVID-19 pandemic — the company reported sequential improvement in the latest quarter. Net sales fell 10.4% in the fourth quarter ended Dec. 31, far better than the 39% drop reported during the height of the pandemic. Excluding $118 million of estimated impact from COVID-19, the company said net sales would have been positive. E-commerce has also become a bigger chunk of sales for Revlon and most of its retail peers. Revlon shares jumped as much as 9.4% to $11.58 in regular trading Thursday after reporting results. Its 6.25% bonds due 2024 last traded traded Feb. 19 around 34.25 cents on the dollar, according to Trace data. Backed by billionaire Ronald Perelman, Revlon has launched various debt transactions to ease its borrowings and buy more time to focus on a business turnaround. It completed a debt exchange in November that eliminated the potential for a bankruptcy filing in the near future.