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The owner of New York Sports Clubs and Lucille Roberts is seeking fresh equity capital to stave off a cash crunch less than two months after buying the gym chains out of bankruptcy, WSJ Pro Bankruptcy reported. The investor-backed acquisition vehicle that bought the fitness chains is soliciting investors for a $2 million equity raise to improve liquidity and fund working capital needs, giving a Wednesday deadline for potential participants to indicate interest. The chains were sold out of bankruptcy in November to Peak Credit LLC, an affiliate of New York-based investment banking firm Lepercq de Neuflize & Co., as well as a number of lenders to the chains’ former owner, Town Sports International LLC. Following Town Sports’ September bankruptcy filing, private-equity firm Tacit Capital LLC had proposed serving as the stalking-horse bidder to acquire the company’s assets. Tacit backed out when it failed to come up with the $47.5 million it had pledged to post to fund operations once the bankruptcy sale closed, according to court records. Peak stepped in for Tacit with a $5 million funding commitment to capitalize an acquisition vehicle called New TSI Holdings Inc. that would own and operate the chains, according to court documents.

Opioid use, and deaths from overdoses, has jumped across North America during the Covid-19 pandemic, the Wall Street Journal reported. The Centers for Disease Control and Prevention in December said the U.S. will record 81,230 drug deaths in the 12 months through May, a record, up from 68,829 during the same period ending in May 2019. In Canada, opioid overdose deaths hit 1,628 in the second quarter, from 1,029 in the first, as the pandemic took hold. The construction industry, already facing a shortage of manual labor, has been hit particularly hard. Bricklayers, carpenters and laborers carry heavy loads and perform the same tasks day in and day out, leading to injuries like carpal tunnel syndrome, strained shoulders and bad backs. Seeking relief, workers can get hooked on strong prescription drugs such as fentanyl, oxycodone and morphine, and street drugs like heroin.

The Diocese of Camden, N.J., and a lawyer for clergy sex abuse victims clashed Monday over the diocese's plan to reorganize its finances under chapter 11 protection, the Cherry Hill (N.J.) Courier Post reported. Attorney Jeff Anderson said that the reorganization plan would create a $10 million trust for victims, while directing more than $217 million to funds for other diocesan activities. "This plan has no relationship to their true ability to pay," said Anderson, who described the proposal as "a sneak attack" filed on Dec. 31. In a statement, the diocese said it "wants to continue to pay survivors rather than lawyers and other professional advisors." It claimed attorneys who handle clergy sex abuse cases "seem to want to elongate the process and see more money dissipated on wrangling." The diocese said it filed its plan in federal bankruptcy court in Camden after a committee representing victims refused to negotiate. Anderson, in contrast, contended the diocese acted "without any input from or consideration for clergy abuse survivors."

In the summer of 2007, after Purdue Pharma agreed to pay $600 million to resolve a federal investigation of opioid-marketing misconduct, the Sackler family members at the helm of the drug giant deliberated whether it was time to leave the pharmaceutical business, the Washington Post reported. “I think we need to discuss if fundamentally we want to be in the pharmaceutical business going forward. I would vote no,” wrote David Sackler, who was not in the company at the time of the June email to his father, Richard, and cousin Mortimer, both on the company’s board. The email chain was about the possible buyout of a smaller company. “I think we’ve all had enough of a rough ride over the past 10 years to make me wary of committing for another venture in the space,” he wrote. Copies of the emails, along with memos and messages from a family WhatsApp group chat, were unsealed last week in U.S. Bankruptcy Court for the Southern District of New York, where the company and its affiliates filed for relief in September 2019. The documents offer the most complete picture yet of the internal deliberations of the wealthy family that led one of the largest manufacturers of prescription painkillers during the height of the opioid crisis. Following the Justice Department settlement, the Sacklers met with a bankruptcy attorney, assessed selling the company to a larger firm and were advised to take “defensive measures,” including through “overseas assets with limited transparency and jurisdictional shielding from U.S. judgments,” according to the documents.

More than 2,000 victims of the Watson Grinding & Manufacturing explosion in northwest Houston are one step closer to getting their day in court, after a federal judge yesterday sent more than 126 cases filed against that company and others back to state court to move forward, the Houston Chronicle reported. The Jan. 24 explosion killed three men, two workers and a nearby resident, and rocked the working class neighborhood of Westbranch, damaging hundreds of homes. Affected residents have embarked on a gradual and often grueling recovery process, wrangling with insurers and rebuilding their homes when possible. Many filed lawsuits against Watson Grinding & Manufacturing and Watson Valve Services, Inc., the two companies located at the site of the explosion. The companies declared bankruptcy two weeks after the blast, effectively freezing the cases. U.S. Bankruptcy Judge Marvin Isgur’s ruling Wednesday essentially unfreezes them, attorneys said. The claims against those two companies, and other companies added to the lawsuits afterward, now will proceed in Harris County District Court. The parties plan to ask the state Supreme Court to appoint a judge to handle all of the cases together.

The Church of Jesus Christ of Latter-day Saints was hit with several lawsuits yesterday for allegedly covering up decades of sexual abuse among Boy Scout troops in Arizona, marking the latest litigation before the state's end-of-year deadline for adult victims to sue, the Associated Press reported. The church "must be held accountable in order to bring healing and closure to Mormon victims of childhood sexual abuse," Hurley McKenna & Mertz, a law firm that focuses on church sex abuse, said in a statement. In the seven lawsuits each representing seven different male victims, attorneys say church officials never notified authorities about abuse allegations. Public records show members of church-sponsored Boy Scout troops who were abused would tell church bishops about what they had experienced. The lawsuits allege bishops would then tell the victims to keep quiet so the church could conduct its own investigation. In the meantime, troop leaders and volunteers accused of sex abuse would be allowed to continue in their roles or be assigned to another troop, the suits said. Church spokesman Sam Penrod said in a statement that the faith has zero tolerance for abuse of any kind and that the serious allegations require thorough investigation. He called it inaccurate to say that the faith had access to files that had names of banned Scout leaders and said that the church hasn't seen the records that allegedly back the accusations. All seven victims are asking for a jury to award an unspecified sum for medical expenses, pain and suffering. They are also seeking punitive damages for the "outrageous conduct" of church officials. The church sponsored at least seven troops in Arizona in metro Phoenix and Tucson, according to attorneys. The suits were all filed earlier this month — six in Maricopa County Superior Court and one in Pima County Superior Court. The allegations of sexual abuse touch all troops between 1972 and 2009.

Bankruptcy creditors are pointing to a trove of decade-old documents as they probe whether members of the billionaire Sackler family improperly took funds out of Purdue Pharma LP, the maker of OxyContin, to keep the assets away from victims of the U.S. opioid epidemic, Bloomberg News reported. Creditors including U.S. states, cities and counties cite recently unsealed memos and emails involving the Sacklers, whose company has twice pleaded guilty to illegally marketing OxyContin painkillers. Creditors say the documents are among “powerful circumstantial evidence” that the Sacklers were worried as early as 2007 about being sued personally and discussed ways to protect their fortunes. “Ask yourself how long it will take these lawyers to figure out that we might settle with them if they can freeze our assets and threaten us,” David Sackler, son of one of the company’s co-owners, said in a May 2007 email included in the unsealed files. The company’s first guilty plea came that same month. “We’re rich?” wrote Sackler, then a 27-year-old money manager who wasn’t employed at the company and didn’t then have a say in strategy. “For how long? Until which suits get through to the family?” Family representatives say that the Sacklers didn’t do anything improper. If creditors succeed in showing the Sacklers made what the creditors claim were “improper transfers,” a judge could order them to make repayments. The documents — made public this month in Purdue’s bankruptcy case — are part of an ongoing fight between more than 20 state attorneys general and Sackler family members over $10 billion the creditors said was improperly moved out of Purdue in the decade following 2007, and whether opioid victims should get some of those funds. The Sacklers are offering to turn over control of the drugmaker to state and local governments and personally pay $3 billion. Creditors say that’s not enough. Purdue filed for bankruptcy last year, citing lawsuits from state and local governments. Creditors scour bankrupt companies for certain pre-filing transfers because owners aren’t allowed to take valuable assets if they think the firm may seek bankruptcy protection. Purdue’s creditors argue in court filings that family members ramped up their efforts to draw money out of the drugmaker after the company’s 2007 plea, amounting to “more than $10.3 billion over the next 10 years — more than 90% of Purdue’s total free cash flow,” according to creditors’ filings.

While the Archdiocese of Agana has yet to compensate nearly 300 Guam clergy sex abuse survivors, it has already paid or been ordered to pay some $3.9 million of the $4.38 million in attorneys' and real estate professionals' fees and costs in its nearly two-year bankruptcy case, the Guam Daily Post reported. These figures are based on a review of proposed, awarded and paid amounts contained in documents filed in the District Court of Guam in 2019 and 2020. The numbers include recent fourth interim fee applications that the federal court will hear in January, amounting to about $480,601. The fourth interim fee applications cover bills for services rendered only from Aug. 1 to Nov. 30, 2020. After review and scrutiny of the proposed billings, inclusive of fees and reimbursable costs, District Court Chief Judge Frances Tydingco-Gatewood reduced many of the amounts from the first three billing cycles, saying the higher the legal fees, the lower the amount that could go to clergy sex abuse survivors. Other defendants in clergy sex abuse cases — including the Sisters of Mercy, the Capuchin Franciscans and the Boy Scouts of America — already have settled with some of the abuse survivors. The settlement amounts have been kept confidential. The archdiocese and other defendants are still in mediation to try to settle the abuse lawsuits, and the billing meters will continue to tick. If settlements fail, the clergy sex abuse lawsuits against the archdiocese could go to trial.

Renovate America Inc., which lends homeowners money to make “green” improvements such as adding solar panels or energy-efficient windows, filed for bankruptcy as litigation and the COVID-19 pandemic eroded revenue, Bloomberg News reported. Renovate’s lending was part of a government-backed program that lets people finance their loans by adding the payments to their property taxes. But consumer advocates and federal regulators have criticized them as expensive and susceptible to abuse. At least 56 legal cases are pending against San Diego-based Renovate, according to a chapter 11 filing on Monday. More than 115,000 loans were handed out by Renovate, according to its website. But revenue plummeted 81 percent between 2016 and last year after new legislation in California established tougher “ability-to-pay” standards for lending, according to a declaration filed by Chief Executive Officer Shawn Stone. Lawsuits have cost about $15 million since the beginning of 2018, Stone wrote. The COVID-19 pandemic provided the final push into bankruptcy, with financing volume dropping 47 percent in the first 10 months of 2020 compared with the previous year.

The U.S. government accused Walmart Inc. of fueling a nationwide opioid crisis by ignoring warnings from its own pharmacists that the chain wasn’t properly set up to screen painkiller prescriptions in violation of federal regulations, Bloomberg News reported. The complaint filed yesterday in Delaware comes two months after the world’s largest retailer filed its own case in Texas accusing the U.S. of scapegoating Walmart for government failures in dealing with the crisis. More than 400,000 Americans’ deaths have been tied to legal and illegal opioid-based drugs over the last two decades. In the new case, the U.S. alleges the retailer sought to boost profits with a system designed to make it almost impossible for overworked store pharmacists to catch red flags about overly large numbers of painkiller prescriptions. Walmart is in the unusual position of serving as the distributor of opioid-based medicines to its own stores. “Given the nationwide scale of those violations, Walmart’s failures to follow basic legal rules helped fuel a national crisis,” the U.S. said in the complaint filed in federal court in Wilmington.