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A former pastoral associate at two western Minnesota Catholic churches has sued her priest-supervisor and the St. Cloud Diocese, accusing the priest of sexual harassment and the diocese of failing to respond to repeated reports of misconduct, the Minneapolis Star Tribune reported. The lawsuit, filed by Theo­dosia Orlando, alleges that the Rev. Joseph Backowski subjected her to "ongoing, unwelcome and offensive verbal and physical harassment and abuse" during her five months working with him. It says the diocese fired her in January because of her complaints. The St. Cloud diocese has not filed a response in court. But in a statement on Friday, it said Backowski was placed on administrative leave in early January because of "personal health concerns" and has been participating in an evaluation and treatment program. He is expected to finish treatment within the month, and the diocesan review board will examine the case. The St. Cloud Diocese announced last year it would declare bankruptcy as it faced more than 70 claims of clergy sex abuse against children, including many older cases. The latest suit is different in that it involves a female professional church employee who reported the problem to her superiors, casting a shadow on the diocese's handling of current cases.

A bondholder proposal to address the wildfire damage claims that drove PG&E Corp. into bankruptcy faces headwinds from wildfire victims, the Wall Street Journal reported. Major groups of victims say that they weren’t consulted on a plan, which includes $14 billion to cover damages that PG&E estimated at $30 billion or more. Lawyers for the official committee that represents wildfire victims and another large group of fire victims said the bondholders haven’t talked to them about the proposal, which was reported Wednesday by Bloomberg. The bondholders, mostly New York-based hedge funds, have been courting lawmakers and unions, pitching their ideas for saving California’s largest utility. Bondholders are offering $14 billion in cash to pay damages, counting on discounted payoffs to insurance companies to reduce PG&E’s overall liability.

California Gov. Gavin Newsom (D) said yesterday that Pacific Gas & Electric Corp. plans to remake its board of directors with hedge fund financiers and people who have little experience in utility operations and safety, and he urged the utility’s leader to change course, the Associated Press reported. “With this move, PG&E would send a clear message that it is prioritizing quick profits for Wall Street over public safety and reliable and affordable energy service,” Newsom said in a public letter to John Simon, the utility’s interim chief executive. The San Francisco-based utility is in the midst of chapter 11 bankruptcy proceedings after it said that it could not afford billions of dollars in liability related to deadly California wildfires in 2017 and 2018. It had previously announced plans to replace most of its board by its annual shareholder meeting in May. But the company has not announced its slate of candidates for the new board. Newsom’s office was briefed by PG&E executives on their proposed slate in recent days, spokesman Nathan Click said. The governor’s office is not releasing the names either.

Members of the Sackler family who control OxyContin-maker Purdue Pharma LP allegedly used a web of corporate entities to transfer funds from the company to themselves, moves the New York attorney general says were fraudulent, on the basis that the company was already insolvent or close to it, the Wall Street Journal reported. An amended lawsuit filed yesterday by New York Attorney General Letitia James against Purdue and eight individual Sackler family members is pushing a novel argument that profits paid to Purdue’s owners should be clawed back because of mounting litigation filed against the company. The claims hinge on a legal theory meant to protect creditors from debtors that try to stash or shield assets for their personal benefit. The billionaire Sackler family allegedly transferred funds from Purdue and an affiliated generic drugmaker called Rhodes Pharmaceuticals LP into various entities that family members control through trusts, according to the amended lawsuit. Rhodes was formed in 2007, state business records show, five months after Purdue pleaded guilty to federal charges of misleading the public about the addiction risk related to OxyContin. The complaint alleges that a senior manager at Purdue called Rhodes a “landing pad” for Purdue “to prepare for the possibility that they would need to start afresh following the crisis then engulfing OxyContin.”

A judge said yesterday that he would grant final approval to PG&E Corp.’s $5.5 billion bankruptcy loan, over the protests of wildfire victims who said the utility surrendered too much control to Wall Street banks, WSJ Pro Bankruptcy reported. Judge Dennis Montali approved the financing during a hearing in a bankruptcy court in San Francisco. Hit with claims for an estimated $30 billion in damages from years of wildfires sparked by its equipment, PG&E said the financing is essential to stabilize its business during a chapter 11 proceeding that is expected to last for years. The lending syndicate is led by J.P. Morgan Securities LLC; Merrill Lynch, Pierce, Fenner & Smith Inc.; Barclays Bank PLC; Citibank NA; BNP Paribas Securities Corp.; Credit Suisse Loan Funding LLC; Goldman Sachs Bank USA; MUFG Union Bank NA; and Wells Fargo Securities LLC. Approval was held up for weeks while the official committee representing wildfire victims pressed lenders for concessions on provisions that dictate what happens if PG&E defaults on the loan. Read more. 

In related news, Some of the biggest players in distressed debt are proposing a $35 billion plan that would allow California utility giant PG&E Corp. to emerge from bankruptcy within a year, Bloomberg News reported. Pacific Investment Management Co., Elliott Management Corp. and Davidson Kempner Capital Management have been meeting with California lawmakers and other stakeholders to discuss the proposal, the people said, asking not to be identified because the discussions are private. The plan would establish a $14 billion cash trust to pay for claims tied to the deadly 2017 and 2018 wildfires that forced the utility to declare bankruptcy, according to the proposal seen by Bloomberg News. Read more. 

A New Jersey jury ruled unanimously for Johnson & Johnson yesterday in the latest lawsuit to reach a verdict over accusations that the company’s talc-based powder products contained asbestos and caused a consumer’s cancer, the New York Times reported. The jury, in Middlesex County Superior Court, not far from Johnson & Johnson’s New Brunswick headquarters, found that Ricardo Rimondi hadn’t proved that he was exposed to asbestos, a carcinogen, via the company’s baby powder. Rimondi’s lawyers argued during the month-long trial that years of exposure to products like baby powder had caused his mesothelioma, a cancer of the lining of the internal organs that is associated with asbestos. Rimondi was one of about 13,000 plaintiffs who have sued Johnson & Johnson, alleging that its products caused their cancer. The company has consistently denied that its powders were ever contaminated with asbestos.

PG&E Corp. has failed to persuade victims of wildfires sparked by its equipment to go along with a $5.5 billion loan, terms of which allow Wall Street banks to start dismantling the company if things go seriously wrong in bankruptcy court, WSJ Pro Bankruptcy reported. Lenders had offered concessions that would give PG&E more time to refinance the loan in the event of a default. However, papers filed Monday in a San Francisco bankruptcy court say the official committee that represents people who lost loved ones or homes in fires occurring over a span of years isn’t satisfied with the concessions. That means Judge Dennis Montali will have to decide at a court hearing today whether to approve PG&E’s bankruptcy loan, one of the largest in history, over the objections of wildfire victims. The California utility filed for chapter 11 protection at the end of January, planning to stay in bankruptcy for years to tackle an estimated $30 billion in fire-related liabilities. Terms of the loan say it could balloon to $9.5 billion if PG&E’s bankruptcy stay is prolonged.

Purdue Pharma, the maker of OxyContin, and its owners, the Sackler family, agreed to pay $270 million to avoid going to a state court trial over the company’s role in the opioid addiction epidemic that has killed more than 200,000 Americans over the past two decades, the New York Times reported. The payment, negotiated to settle a case brought by the state of Oklahoma, was far larger than two previous settlements Purdue Pharma had reached with other states. It could jolt other settlement talks with the company, including those in a consolidated collection of 1600 cases overseen by a federal judge in Cleveland. “Purdue appears to have concluded that it was less risky to settle the Oklahoma case than have the allegations publicly aired against it during a televised trial and face exposure to what could have been an astronomical jury verdict,” said Abbe R. Gluck, a professor at Yale Law School who directs the Solomon Center for Health Policy and Law. In a statement released after the settlement announcement, Purdue Pharma’s chief executive, Dr. Craig Landau, said: “Purdue is very pleased to have reached an agreement with Oklahoma that will help those who are battling addiction now and in the future.”

Purdue Pharma LP has agreed to settle the state of Oklahoma’s claims that its illegal marketing of the Oxycontin painkiller caused financial devastation to local communities, the first accord in a recent wave of lawsuits stemming from the U.S. opioid crisis, Bloomberg News reported. The settlement comes two months before the scheduled start of a trial against Purdue Pharma, Johnson & Johnson and Teva Pharmaceutical Industries Ltd. in Norman, Oklahoma. Terms of the deal, which covers only Purdue, weren’t immediately available. Oklahoma claims that the three opioid makers understated the risks of prescription painkillers and overstated their benefits, fueling an epidemic that’s costing its communities tens of millions of dollars for treatment and policing. Those companies and others are also battling claims by three dozen other states and 1,600 U.S. cities and counties, but those suits are pending in another court and the first trial isn’t until the fall.