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Imerys Talc America Inc. has filed for bankruptcy protection as it faces accusations that the talc it supplied for Johnson & Johnson’s baby powder causes cancer, the WSJ Pro Bankruptcy reported. The company filed for chapter 11 protection yesterday after spending tens of millions of dollars to defend itself against lawsuits alleging its talcum powder causes ovarian cancer and mesothelioma. The talc supplier faces claims from more than 14,600 people, a number that has grown dramatically in recent years in the wake of large verdicts against Imerys and baby powder maker Johnson & Johnson. The two companies contend talc doesn’t cause cancer or contain asbestos and Johnson & Johnson has succeeded in getting some verdicts overturned on appeal. The Imerys filing in U.S. Bankruptcy Court in Wilmington, Del., immediately suspends all talc-related litigation against the U.S.-based mining company and will enable Imerys officials to negotiate payouts with those who have sued them.

A group of Republican U.S. Senators have reintroduced legislation that would require plaintiffs to disclose when they’ve secured third-party funding in litigation, the National Law Journal reported. Sens. Chuck Grassley (R-Iowa), John Cornyn (R-Texas), Thom Tillis (R-N.C.), and Ben Sasse (R-Neb.) yesterday reintroduced the Litigation Funding Transparency Act (LFTA). The bill would require disclosure of third-party litigation funding for class actions and multi-district litigation within 10 days of a case being filed, or 10 days after the closure of a funding deal. The bill, likewise, would require disclosure of financing to provide cash for plaintiffs. Grassley, Cornyn and Tillis proposed a prior version of the bill last year after a less extensive bill that called only for disclosure only in class actions passed out of the U.S. House of Representatives in 2017 — before Democrats took a majority of House seats in the November 2018 elections. The reintroduction of the bill comes as a group of 30 in-house counsel at 30 major companies have backed a proposal to amend Federal Rules of Civil Procedure to require full disclosure of third-party funding in litigation.

A California’s team of advisers on PG&E Corp.’s bankruptcy has been given 60 days to map out a plan to ensure the lights stay on, wildfire victims get justice and ratepayers and employees are protected, Bloomberg News reported. The Golden State has hired bankruptcy attorneys and financial specialists to help strategize, Governor Gavin Newsom said during his state of the state address yesterday. Meanwhile, in bankruptcy court, the U.S. Trustee appointed the official committee to act on behalf of all unsecured creditors, including labor representatives and power providers. PG&E’s bankruptcy puts in question the future of power and gas service to millions of people — about 40 percent of the most populous U.S. state. California’s biggest utility filed for chapter 11 protection last month, saying it faced an estimated $30 billion or more in liabilities from wildfires in 2017 and 2018.

PG&E Corp., which filed for bankruptcy last month, announced a boardroom shakeup that would bring back at most half of the current board members, Bloomberg News reported. No more than five of the utility owner’s 10 current board members will stand for re-election at its upcoming shareholders meeting, according to a statement yesterday from the company. The company wants mostly independent directors, and the new board will have 11 of them, it said. PG&E has faced pressure from lawmakers, regulators and shareholders to revamp its management after 2017 and 2018 fires exposed it to liabilities that could exceed $30 billion and pushed the company into bankruptcy last month. Hedge fund BlueMountain Capital Management LLC has said that it will seek to replace PG&E’s entire board while calling the company’s decision to restructure a “reckless” move that will harm shareholders. PG&E removed Chief Executive Officer Geisha Williams shortly before the bankruptcy and also announced the resignation of board member Roger H. Kimmel last month. The next shareholders’ meeting is scheduled for May 21.

USA Gymnastics is suing nearly a dozen insurers, accusing them of refusing to pay its legal costs in more than 100 lawsuits from gymnasts who say they have been sexually abused by Larry Nassar, the Wall Street Journal reported. USA Gymnastics officials are asking Judge Robyn Moberly to force the insurers to explain the limits of each policy and clarify what defense costs are covered. Lawyers for the Indiana-based sports organization said that it has been hurt by some insurers’ “refusal to confirm coverage and satisfy their duty to defend,” according to a 13-page lawsuit filed on Friday in U.S. Bankruptcy Court in Indianapolis. The embattled organization filed for chapter 11 bankruptcy in December, facing law-enforcement investigations and lawsuits filed by more than 300 women and girls, including former Olympic gymnasts. They said the organization failed to protect them from Nassar, the U.S. national team’s longtime doctor. Nassar pleaded guilty in 2017 to state sexual-abuse charges and federal child-pornography counts and is serving an effective life sentence in federal prison. He volunteered with USA Gymnastics for three decades, in addition to his work at Michigan State University, until he was fired in 2016. Victims have cited instances of Nassar’s abuse as early as the mid-1990s.

California utility PG&E Corp plans to increase the controversial practice of shutting off the power to communities at risk of wildfire when dangerous conditions such as high winds and dry heat are present, Reuters reported. In a report to state regulators, PG&E said that it would also remove 375,000 trees near electricity lines, trim vegetation over 2,500 square miles (6,475 square km) and conduct thousands of inspections to prevent its equipment from sparking wildfires. PG&E is under intense scrutiny for its role in sparking more than a dozen wildfires over the past two years. It filed bankruptcy last month, citing anticipated liabilities, including the possibility its equipment set off November’s deadly Camp Fire, which destroyed the Northern California town of Paradise and killed 86 people. The San Francisco-based utility, which serves 16 million customers, said it would increase nearly tenfold its efforts to turn off the power to communities threatened by wildfire, increasing the number of households and businesses potentially affected by fire-prevention blackouts in 2019 to 5.4 million.

The bankruptcy of California utility PG&E illustrates the dangers of politicians directing business investment, according to a Wall Street Journal editorial on Friday. PG&E filed under chapter 11 last week amid a race to the courthouse by wildfire victims, insurers and other creditors. The utility, which provides electricity and natural gas to 16 million people in Northern California, says that it expects $30 billion or so in liabilities from more than a dozen major wildfires in recent years caused by its equipment. California’s Public Utilities Commission (PUC) reviews rates, enforces state laws and establishes safety requirements. Regulators allow utilities to pass most capital and operating expenses through to customers while guaranteeing investors a modest return. The problem is that PG&E’s government overseers seem to have prioritized the state’s climate goals over safe and reliable service, according to the editorial. PG&E rates are already among the highest in the country and have increased by 40 percent over the last decade compared to 15 percent nationwide. But the reality is that rates would be far higher if PG&E had spent more on insulating equipment, clearing overgrown vegetation and taking other precautionary measures to reduce wildfire hazards. Read more. (Subscription required.)

*The views expressed in this editorial are from the author/publication cited, are meant for informative purposes only, and are not an official position of ABI.

Now that PG&E Corp. has filed for protection from its creditors because of California wildfire liabilities, all eyes are on the bankruptcy court. But another federal judge may wind up playing a prominent role in the case, WSJ Pro Bankruptcy reported. Judge William Alsup of the U.S. District Court for the Northern District of California oversees a criminal case involving PG&E, which is on federal probation after being found guilty of violating the Pipeline Safety Act in connection with a natural gas pipeline explosion that killed eight people in San Bruno, Calif., in 2010. Judge Alsup is set to hear whether the utility violated its probation in that case — and whether he should impose tougher safety restrictions on the company — after the state found its electrical equipment sparked more than a dozen California wildfires in recent years. Judge Alsup has the authority to intervene in the chapter 11 bankruptcy case, which is being overseen by U.S. Bankruptcy Court Judge Dennis Montali. Some observers believe he will do just that. “They could sell tickets for that,” said one former PG&E executive, who noted that Judge Alsup has shown intense interest in protecting the public from PG&E safety lapses. While it would be unusual for a U.S. district court judge to take an active role in a bankruptcy case, it isn’t without precedent. U.S. district judges have the power to issue a “withdrawal of reference” and take back cases, in whole or in part, from bankruptcy courts at any time.

PG&E Corp. arrived in chapter 11 bankruptcy at six minutes after midnight on Tuesday, saying it has an immediate need to borrow $1.5 billion as it launches what it says will be a long turnaround effort, WSJ Pro Bankruptcy reported. The loan, from a syndicate of Wall Street lenders led by JPMorgan Chase & Co., will grow to $5.5 billion, or even higher, if it is approved by the bankruptcy court. There’s room in the loan package for additional borrowing of up to $4 billion if PG&E convinces a judge it needs the money for a prolonged bankruptcy stay, court papers say. According to PG&E, the financing is designed to keep it going for years, as it tackles liabilities for deaths and damage from wildfires linked to its equipment, liabilities that it says could add up to $30 billion.

PG&E Corp. and its Pacific Gas & Electric Co. utility filed for chapter 11 protection in San Francisco as investigators probe whether its equipment ignited the deadliest fire in state history, Bloomberg News reported. The San Francisco-based company listed $51.7 billion in total debts and $71.4 billion in assets. California’s wildfires have in the past saddled utilities with millions of dollars in damages, but never have the blazes exacted such a massive financial toll from a company — creating one of the country’s largest utility bankruptcies of all time. Since November’s Camp Fire, which destroyed the town of Paradise, PG&E has seen about three-fourths of its market value wiped out, its chief executive officer leave, its bonds plunge to junk status and estimates of its fire liabilities swell to more than $30 billion. The only time the company has ever faced such dire financial straits was during the 2001 energy crisis, when it was forced to place its utility unit in bankruptcy protection. The same judge who oversaw the company’s last chapter 11 filing, Dennis Montali, has been assigned to its most recent. The utility’s top creditors include Bank of New York Mellon Corp., Citibank, Mizuho and Bank of America Corp. Bank of New York Mellon holds the largest unsecured claim, totaling $3 billion, court filings show. The first meeting of creditors has been set for Feb. 26.