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Private equity-owned stationary and gifts retailer Paper Source Inc. filed for bankruptcy, planning to permanently close some stores and sell itself to an affiliate of asset manager Apollo Global Management Inc. in exchange for debt relief, subject to better offers, WSJ Pro Bankruptcy reported. Chicago-based Paper Source filed for chapter 11 protection Tuesday in the U.S. Bankruptcy Court in Richmond, Va., becoming the latest retail chain pushed into bankruptcy as a result of the COVID-19 pandemic. Paper Source said its business was strong and growing until it was forced to temporarily close all of its nearly 160 stores last March in response to COVID-19. Revenue then dropped from canceled weddings and lost sales during the Mother’s Day and Easter holidays. The company closed stores weeks after Paper Source acquired additional locations from a competitor, Papyrus Inc., which itself was in chapter 11 at the time.

A federal bankruptcy court judge has approved the sale of a century-old amusement park in northwestern Pennsylvania, the Associated Press reported. Pittsburgh-based U.S. Bankruptcy Court Judge Jeffrey Deller yesterday approved the sale of Conneaut Lake Park to Keldon Holdings LLC for a cash price of $1.2 million. The sale includes the amusement park and its rides, including the historic Blue Streak roller coaster, as well as the water park, the beach area, Hotel Conneaut, a campground and active leases on assets.

The Boy Scouts of America released a bankruptcy reorganization plan yesterday calling for local councils to contribute at least $300 million to a trust to settle tens of thousands of sex-abuse claims, the Washington Post reported. The long-awaited reorganization plan, filed as part of the Boy Scouts’ ongoing chapter 11 bankruptcy proceedings, begins to outline how the embattled organization aims to compensate the deluge of 85,000 potential victims who came forward last year with claims. But lawyers on behalf of both the victims and the group’s insurers say that they are unsatisfied with the plan. The Boy Scouts of America, which filed for bankruptcy in February 2020, had initially sought to shield its local councils from the bankruptcy process. But more recently, it became clear that any settlement was going to involve local council participation, and yesterday’s filing anticipates a $300 million contribution from some of the Boy Scouts’ 253 councils across the country. The plan did not state which councils would contribute to the fund, or how. To fund the settlement trust, the Boy Scouts of America will also contribute a collection of Norman Rockwell paintings, a warehouse facility in North Carolina, the rights to a Scouting University property in Texas, certain oil and gas interests in several states, and any unrestricted cash above a $75 million minimum.

A judge rejected an effort by a major National Rifle Association vendor to get a bigger voice for suppliers in the gun group’s bankruptcy, ruling there was no proof trade creditors aren’t adequately represented in the chapter 11 case, WSJ Pro Bankruptcy reported. Membership Marketing Partners LLC argued that the unsecured creditors committee in the chapter 11 case needed more input from vendors and accused the Justice Department’s bankruptcy watchdog who picked the committee of stacking it with parties that have “an axe to grind” against NRA management. Such requests to reconstitute creditor committees are rarely made in chapter 11. Judge Harlin DeWayne Hale called MMP’s request unusual during a hearing last Wednesday in the U.S. Bankruptcy Court in Dallas before he denied MMP’s bid to reconstitute the committee. MMP has a longstanding business relationship with the gun group. It is mentioned in the New York attorney general’s lawsuit against the NRA, which preceded the bankruptcy filing and alleges spending abuses at the nonprofit gun-rights group. The NRA has denied the allegations and claimed they were politically motivated. The lawsuit doesn’t accuse MMP of wrongdoing. The New York complaint describes trips that NRA Chief Executive Wayne LaPierre allegedly took to visit MMP’s principal and stay on his 108-foot yacht while visiting the Bahamas. The lawsuit said Mr. LaPierre’s use of the yacht constituted a gift and wasn’t disclosed by the NRA, a violation of the organization’s bylaws, a claim the NRA and Mr. LaPierre have denied. The company also leases office space in the NRA’s Virginia headquarters, and was paid $71 million by the NRA from 2014 through 2020 for fundraising, mailing and printing, according to court documents filed last week by the NRA in response to New York Attorney General Letitia James’ lawsuit.

Car rental company Hertz Global Holdings Inc. said today that it had filed a proposed plan of reorganization with the U.S. Bankruptcy Court for the District of Delaware, Reuters reported. Under the plan, Knighthead Capital Management LLC and Certares Opportunities LLC will invest about $4.2 billion to buy up to 100% of common stock of reorganized Hertz.

Video streaming company MobiTV Inc. filed for bankruptcy protection, and plans to look for a buyer while staying afloat with a $15.5 million loan from T-Mobile US Inc., WSJ Pro Bankruptcy reported. The Emeryville, Calif.-based software company entered chapter 11 proceedings in the U.S. Bankruptcy Court in Wilmington, Del., with total assets of $19 million and liabilities of $75 million. The company’s roughly $25 million in secured debt is owed mostly to Ally Financial Inc., but T-Mobile also became a secured lender in recent months, providing MobiTV with roughly $5 million in bridge financing, according to court documents filed yesterday. MobiTV’s unsecured debts include about $9 million owed to bondholders, $15 million to trade creditors and $3 million under the federal Paycheck Protection Program. Major shareholders include Oak Investment Partners, which owns 44% of the common stock. Smaller equity owners include Hearst Communications Inc. and the U.S. Small Business Administration, records showed. As recently as 2019, MobiTV received $50 million in new funding from backers including Oak. MobiTV holds key contracts with T-Mobile and more than 120 cable and broadband TV providers to deliver streaming content to more than 300,000 subscribers.

Texas’s largest and oldest electric power cooperative on Monday filed for bankruptcy protection in federal court in Houston, citing a disputed $1.8 billion bill from the state’s grid operator, Reuters reported. Brazos Electric Power Cooperative Inc is one of dozens of electricity providers facing enormous charges stemming from a severe cold snap last month. The fallout threatens utilities and power marketers who collectively face billions of dollars in blackout-related charges, executives said. Unusually frigid temperatures knocked out nearly half of the state’s power plants in mid-February, leaving 4.3 million people without heat or light for days and bursting water pipes that damaged homes and businesses. Brazos and others that committed to provide power to the grid and could not, were required to buy replacement power at high rates and cover other firms’ unpaid fees. The state’s grid operator, Electric Reliability Council of Texas (ERCOT), on Friday said $2.1 billion in initial bills went unpaid, underscoring the financial stress on utilities and power marketers. More providers likely will reject the bills in coming days, executives said. “The municipal power sector is in a real crisis,” said Maulin Patani, a founder of Volt Electricity Provider LP, an independent power marketer that is not a member of the Brazos coop. ERCOT should suspend the service charges to halt further defaults, he said in an interview on Sunday. The city of Denton, in north Texas, last week sued ERCOT in a state court to prevent it from charging it for fees unpaid by other users of the grid. Denton Electric could face tens of millions of dollars for fees that were not collected from others, the suit claimed.

The judge overseeing the bankruptcy case filed against Navient Corp.’s student-loan servicing arm dismissed the involuntary petition, saying there was no evidence the student-loan giant isn’t paying its debts, WSJ Pro Bankruptcy reported. Three individuals who allege that Navient improperly collected on their student debt even after they discharged it through their own personal bankruptcies had filed an involuntary chapter 11 petition against Navient Solutions LLC earlier this month. Judge Martin Glenn of the U.S. Bankruptcy Court in New York ruled yesterday that since the debts are part of the individuals’ claims that are still being disputed, with some subject to ongoing litigation, the borrowers had no basis to assert that Navient had failed to refund the alleged overpayments. “The proper place for that litigation to proceed is in the courts grappling with those issues, and not by jumping the queue with this involuntary petition,” Judge Glenn said.

A dispute between the Boy Scouts of America and childhood sex-abuse victims has put a cease-fire agreement at risk with the youth organization’s survival strategy on the line, WSJ Pro Bankruptcy reported. The Boy Scouts are asking a bankruptcy judge to force an extended standstill in legal hostilities by sex-abuse victims against the local councils that control the bulk of the group’s billions of dollars in wealth. The chances of a reorganization for the Boy Scouts hang in the balance, lawyers for the organization said in a court filing on Monday. The official committee that represents sex-abuse victims will fight the effort to force a legal peace, said James Stang, lead lawyer for the committee. “We intend to aggressively oppose the motion to extend the preliminary injunction,” Stang said. “We have significant questions, underlying factual questions that haven’t been answered.” The brewing trouble highlights a vulnerability in the Boy Scouts’ strategy of resolving tens of thousands of sex-abuse claims. Only at the national level does the organization enjoy chapter 11 protection from lawsuits accusing it of failing to protect children from sexual predators. More than 250 local councils aren’t in bankruptcy, meaning the estimated $3 billion of the wealth they control isn’t shielded by the automatic stay of chapter 11, which protects against collection efforts after a bankruptcy filing. New York, New Jersey, California and other states in recent years changed their statute-of-limitations laws to allow for individual lawsuits over childhood sexual abuse even if the alleged injuries happened decades ago. In February 2020, the prospect of an onslaught of litigation propelled the Boy Scouts into bankruptcy, where it faces a reckoning with an estimated 85,000 people who have made compensation claims for suffering sexual abuse.