%1

Major League Baseball on Wednesday pushed a bankrupt sports broadcaster to cancel or clearly commit to five teams' TV broadcast contracts, saying the teams can't plan for the 2024 season without clarity on their TV contracts, Reuters reported. MLB asked a U.S. bankruptcy judge in Houston, Texas to force Diamond Sports Group to make a clear decision on whether it will broadcast 2024 games for the Atlanta Braves, Cleveland Guardians, Detroit Tigers, Milwaukee Brewers and Texas Rangers. MLB asked the court to compel a contract decision late Wednesday, along with a separate filing opposing Diamond's request for more time to file a restructuring plan with the court. MLB warned that the league could find itself scrambling to broadcast games for multiple teams next year, as it did this year for the Arizona Diamondbacks and San Diego Padres. "At the moment, MLB and the Clubs can only guess which Clubs the Debtors may continue to support and which may be left without a telecast partner," MLB said.

Home furnishings manufacturer Mitchell Gold + Bob Williams has been ordered into liquidation by a federal bankruptcy court judge responding to a request by its primary lender, PNC Financial Services Group, the Winston-Salem (N.C.) Journal reported. The manufacturer in August became the third prominent North Carolina furniture maker to abruptly cease operations, leaving its 533 employees in Hiddenite, Statesville and Taylorsville without jobs. Like United Furniture Industries and Klaussner Furniture Industries, Mitchell Gold cited an inability to secure future funding as the primary reason for shutting down. Recently, Judge Laurie Silverstein ordered the liquidation, saying it is "in the best interests of the debtors and their respective entities, creditors and all parties." Judge Silverstein did not address the reasoning behind the decision to convert to liquidation nor deadlines for completing the process.

The Boy Scouts of America has turned over a trove of records that survivors of sexual abuse and their lawyers have long sought from the youth group, which emerged earlier this year from bankruptcy with a plan to pay roughly $2.4 billion to resolve more than 82,000 individual abuse claims, WSJ Pro Bankruptcy reported. The youth group last week provided the majority of the more than 7,766 records regarding so-called ineligible volunteers, maintained to keep sexual abusers out of its ranks, to a settlement trust that helps distribute payments to survivors. Most of the files haven’t previously been made available to claimants and their lawyers. “There are over 6,300 new ineligible volunteer files that I just got access to,” said Chris Hurley, a member of the settlement trustee’s advisory committee and a lawyer for sexual-abuse survivors associated with the Boy Scouts. Access to the records could strengthen victims’ cases against alleged perpetrators and help survivors decide whether to pursue independent reviews of their claims, which would cost them $20,000 each but potentially result in more compensation than other settlement options.

In In re The Hacienda Company, LLC, No. 2:22-bk-15163, the U.S. Bankruptcy Court for the Central District of California (Judge Neil W. Bason) denied a motion to dismiss the chapter 11 bankruptcy case despite finding that the marijuana-industry debtor was engaged in an ongoing, post-petition violation of the federal Controlled Substances Act (CSA), according to a Reuters analysis. The Hacienda court's refusal to dismiss this marijuana industry case — on two separate occasions — and instead to confirm the chapter 11 plan, represents a departure from the vast majority of bankruptcy court decisions, which reached the opposite result: dismissing bankruptcy cases based on perceived violations of federal drug laws alone. See, e.g., In re: Way to Grow, Inc., 610 B.R. 338 (D. Colo. 2019); Burton v. Maney (In re Burton), 610 B.R. 633 (9th Cir. BAP 2020). Pre-petition, the Debtor was in the business of wholesale manufacturing, packaging, and distribution of cannabis products to dispensaries in California under the brand name Lowell Herb Co. The debtor ceased its operations and transferred its assets to Lowell Farms, Inc. (Lowell Farms), a Canadian entity, whose sole business was cannabis growth and sales. In return, the debtor received approximately 9.4% of Lowell Farms' shares, valued at approximately $35 million at the time of sale.

Four surgical centers in Connecticut will emerge from bankruptcy under new ownership, according to an application with the Office of Health Strategy, the Hartford Business Journal reported. Wilton Surgery Center, Bloomfield Eye Surgery Center, Connecticut Eye Surgery Center South in Milford and Eastern Connecticut Endoscopy Center in Norwich have filed separate Certificate of Need applications seeking OHS approval of a proposed indirect change in ownership. Nashville, Tenn.-based Envision Healthcare Corp. currently owns the four surgical centers through an affiliate, AmSurg LLC. In May, Envision filed for chapter 11 bankruptcy in the Bankruptcy Court for the Southern District of Texas. As part of the bankruptcy, a creditor — Pacific Investment Management Co. LLC — will take ownership through a subsidiary, according to the application. The court is expected to approve the deal during the fourth quarter of 2023. The facilities will continue to operate under their existing licenses and will provide the same services, according to the application. AmSurg owns more than 250 surgical centers in 34 states. Pacific Investment Management Co., also known as PIMCO, is based in Newport Beach, California.

Bond investors with Preston Hollow Community Capital were the highest bidders in Mercy Iowa City's bankruptcy auction. Preston Hollow Community Capital is a Dallas-based company worth billions of dollars, KWWL.com reported. Operations at the facility will be managed by American Healthcare Systems, which officials say has experience in rehabilitating clinics across the United States. Ownership of the hospital will be organized as a not-for-profit group. Chairman and CEO of Preston Hollow Community Capital Jim Thompson said, "Since making a major financial investment in Mercy Iowa City in 2018, Preston Hollow Community Capital has been committed to ensuring that Johnson County residents can continue accessing critical health care services through a community-based hospital.… The Preston Hollow team is pleased that this critical goal will be met for many years to come now that our bid to acquire the hospital has been approved.” Preston Hollow Community Capital will make "significant" capital investments in order to stabilize the hospital's operations.

Caroline Ellison, a top adviser to the cryptocurrency mogul Sam Bankman-Fried, testified on Wednesday that she had lied over and over at his request, misleading the public about his businesses and circulating “dishonest” financial documents to crypto lenders, the New York Times reported. By the time Mr. Bankman-Fried’s two companies — FTX, a digital currency exchange, and Alameda Research, a hedge fund — collapsed in November, the lies had become too much to bear, Ms. Ellison said, and the implosions were almost cathartic. “Overall it was the worst week of my life,” said Ms. Ellison, 28, fighting back tears as she recounted the frantic week when the companies failed. “I felt this sense of relief that I didn’t have to lie anymore, and that I could start taking responsibility even though I felt indescribably bad.” Ms. Ellison’s testimony, in her second day on the witness stand, was the most emotional moment so far of Mr. Bankman-Fried’s fraud trial. She was widely considered the government’s star witness, partly because she dated Mr. Bankman-Fried on and off for years, giving her unique access to the FTX founder as his crypto empire grew. His trial in federal court in Manhattan has become a referendum on high-risk practices across the crypto industry that led to billions of dollars in losses last year.

A bankruptcy judge ordered the founder of Bang Energy to pay $63,517 for his Instagram posts that disparaged company advisers who sold the energy drink brand to rival Monster Beverage Corp., Bloomberg News reported. Judge Peter Russin said in a court filing yesterday that the since-deleted social media posts by Bang founder Jack Owoc “could best be described as a rant” and risked harming Bang’s business because they potentially questioned the integrity of the bankruptcy sale process. Owoc, who was fired as Bang chief executive officer in March, made the comments under posts from a @BangEnergy.CEO Instagram account that had 1 million followers. At the time, he was fighting company lawyers over ownership of Bang-affiliated social media accounts. Owoc deleted the disparaging comments after Judge Russin warned him that he could be fined $25,000 a day until the posts were removed, Bloomberg reported in April. Judge Russin said that Owoc’s posts violated a temporary restraining order he and his wife, Megan Owoc, had agreed to abide by. The judge said the Owocs also violated the restraining order because they failed to turn over passwords for TikTok, Twitter and Instagram accounts in question by a March deadline.

Mallinckrodt, one of the largest manufacturers of prescription opioids in the U.S., received court approval for a plan that wipes out more than $1 billion of payments meant for addicts while handing control of the pharmaceutical company to its lenders, WSJ Pro Bankruptcy reported. The U.S. Bankruptcy Court for the District of Delaware yesterday approved the plan that would pave the way for the company to exit from bankruptcy, less than a couple of months after it filed for chapter 11 protection. Mallinckrodt executives have said the company reached a restructuring deal after extensive outreach from its creditors, who, the executives said, believed the drugmaker carried too much debt and needed to right-size its finances to stay in business. This is a setback to governments and individual addicts who filed lawsuits seeking compensation from drugmakers for their role in the opioid crisis. The legal fight stretches back nearly a decade, when more than 3,000 lawsuits from states, Native American tribes and counties alleged the drugmakers, pharmacies and distributors played down the risks of the painkillers and didn’t stem their flow. A few opioid manufacturers that lacked the funds to settle those thousands of lawsuits turned to bankruptcy to try to resolve them. Dublin-based Mallinckrodt, for instance, agreed to pay $1.7 billion into a trust for addicts over eight years to resolve thousands of lawsuits over its alleged role in fueling the opioid crisis. As part of that deal, negotiated during Mallinckrodt’s first bankruptcy filed in 2020, addicts permanently surrendered their legal rights to pursue opioid-related litigation against the company, and the drugmaker was allowed to keep manufacturing the drugs. Mallinckrodt this August filed for bankruptcy again to restructure its debts and outstanding obligations, including more than $1 billion still owed to the opioid victims’ trust.

Three days into Sam Bankman-Fried’s criminal trial in Federal District Court in Manhattan, Judge Lewis A. Kaplan’s warnings to the defense had become unmistakable, the New York Times reported. Judge Kaplan, who is presiding over the high-profile white-collar fraud case, repeatedly told Mr. Bankman-Fried’s lawyers to stop repeating themselves. Over and over, he directed them to rephrase their questions. And with his frequent interruptions of their cross-examinations, Judge Kaplan kept Mr. Bankman-Fried’s legal team off balance, putting it on the defensive. “I just want to express my growing concern about the extent of the entirely unnecessary repetition, and I’ve given you a lot of latitude,” Judge Kaplan told one of Mr. Bankman-Fried’s lawyers, Christian Everdell, during a brief break on Thursday when the jury was not in the courtroom. “You’re wearing out the welcome on the repetition.” Judge Kaplan is a veteran jurist with a history of presiding over prominent trials like that of Bankman-Fried, who is charged with orchestrating a scheme to misappropriate as much as $10 billion that customers deposited with his crypto exchange, FTX. While he is known for his no-nonsense attitude in the courtroom, legal experts say that Judge Kaplan is keeping the defense on an unusually short leash. Bankman-Fried’s trial resumed on Tuesday, with two crucial witnesses. Defense lawyers continued cross-examining Gary Wang, one of FTX’s top executives, who testified last week that Bankman-Fried had instructed him to insert a secret backdoor into the company’s code that enabled the theft of customer funds. There were fewer interruptions, with Everdell pointing out some inconsistencies in Mr. Wang’s initial statements to FBI agents and his testimony at trial last week. Prosecutors then called Caroline Ellison, Bankman-Fried’s former girlfriend, who ran a crypto trading firm that the government says tapped into FTX customer deposits. Wang and Ellison have pleaded guilty and are cooperating with the authorities. Bankman-Fried has pleaded not guilty to seven counts of wire fraud and conspiracy.