%1

Survivors of sex abuse by church officials of the Roman Catholic Diocese of Great Falls-Billings (Mont.) are asking a bankruptcy judge to allow two state district court lawsuits to go to trial to determine damages and to move the case along, the Billings Gazette reported. Settlement talks between the diocese, its insurance carrier, Catholic Mutual, and the sex abuse claimants ended in impasse at the most recent mediation, which was in September in Reno, Nevada. Bryan Smith, a Yakima, Wash.-based attorney and co-counsel for one of the survivors who sued the diocese in state district court in Great Falls in December 2011, said on Monday that the motions seeking to allow the state lawsuits to continue is “a desire of the plaintiffs to move the case forward in any way.”

Takata Corp., the parts supplier that filed for bankruptcy after sparking the largest auto recall in history, called back 3.3 million air bags as part of a U.S. order that scheduled repairs of the potentially deadly devices over several years, Bloomberg News reported. The supplier identified at least 15 automakers that purchased the air bags, including Toyota Motor Corp., Honda Motor Co., General Motors Co., BMW AG and Tesla Inc. Takata said that it will work with the companies to develop a remedy for each of their vehicles, and urge consumers to get their air bags replaced. Defective Takata inflators can explode in a crash and spray vehicle occupants with metal shards. The parts have been linked to 13 deaths in the U.S. and hundreds of injuries, and mounting liabilities from the recalls pushed Takata to file for bankruptcy in June. Key Safety Systems Inc., a supplier owned by China’s Ningbo Joyson Electronic Corp., plans to acquire the company.

A judge overseeing the Diocese of Duluth's bankruptcy has signed off on two insurance company settlements that will pump nearly $10 million into the case, the West Central Tribune (Willmar, Minn.) reported. The agreements, approved by U.S. Bankruptcy Judge Robert Kressel at a hearing yesterday in Minneapolis will provide almost $9 million to victims of child sexual abuse and allow officials to pursue additional compensation. The settlements with Catholic Mutual Relief Society of America and Fireman's Fund Insurance Co. resolve two-fifths of a federal lawsuit filed in June 2016 that has stalled the bankruptcy proceedings. The diocese, which filed for chapter 11 protection in December 2015 in the wake of a $4.9 million verdict, brought the suit against five insurers in an effort to force coverage of claims received from 125 people who said they were abused by priests.

The Securities and Exchange Commission has sued Robert Shapiro, accusing the former chief executive of Woodbridge Group of operating a Ponzi scheme that raised more than $1 billion from individual investors for the now-bankrupt real estate operation, WSJ Pro Bankruptcy reported. Shapiro is accused of lying to investors, signing falsified documents and making “Ponzi payments to investors,” as well as using investor funds for his own personal enjoyment, among other wrongs, according to papers unsealed yesterday in a Florida federal court. A lawyer for Shapiro says the former chief executive denies the SEC’s allegations. “Mr. Shapiro is cooperating with the bankruptcy to protect the assets held for the benefit of Woodbridge’s stakeholders,” said Ryan O’Quinn, a lawyer for Shapiro. “He denies any allegation of wrongdoing and looks forward to his opportunity to defend himself in a court of law.” Woodbridge and some of its affiliates filed for chapter 11 bankruptcy protection Dec. 4, a year into an SEC probe of its fundraising activities.

People with injuries or economic damage from Takata Corp.-made air bags will get a fraction of a penny for each dollar they are owed, under a U.S. chapter 11 bankruptcy plan unveiled this week, WSJ Pro Bankruptcy reported. The bankruptcy payment plan for Takata’s U.S. unit sets out a system for distributing the beleaguered company’s assets, including a share of cash from the $1.6 billion sale of the non-air bag businesses to Key Safety Systems Inc. Money from the Key sale won’t go far to address the billions of dollars of damages stemming from Takata’s potentially defective air bags, court papers indicate. Takata U.S.’s chapter 11 plan estimates personal-injury and wrongful-death damages alone will top $1 billion. Add to that economic losses such as the cost of renting vehicles while air bags are replaced, and the money spent by car makers cleaning up after Takata’s defective parts, and the bankruptcy payout falls billions of dollars short of covering the damage from the defective parts. An official overseeing a massive recall of the dangerous safety devices, John Buretta, reported in November that the “words ‘grenade’ and ‘ticking time bomb’ accurately convey the lethal potential” of Takata air bags installed in millions of vehicles around the world.

A committee of unsecured creditors in the bankruptcy of the Roman Catholic Diocese of Great Falls-Billings is suing the church, alleging that more than $70 million in real property and other assets are part of the church’s estate and should be available for creditors and survivors of sex abuse by church officials, the Billings (Mont.) Gazette reported. The adversarial complaint, filed on Monday in U.S. Bankruptcy Court, said that getting the disputed assets issue resolved “is critical” to the church’s estate because it will “determine the magnitude of distributions to its creditors, including survivors of the childhood sex abuse enabled by (the diocese) or whether (the diocese) can continue to avoid being held accountable to the survivors.” Attorney James Stang, of Los Angeles, Calif., who represents the unsecured creditors committee, said yesterday that the committee's goal is to reach a negotiated settlement and that the complaint is "part of the process." The committee represents eight sex abuse survivors, Stang said.

A second insurer has agreed to settle its part in a lawsuit brought by the Diocese of Duluth in its ongoing bankruptcy, the Duluth (Minn.) News Tribune reported. Fireman's Fund Insurance Co. would pay the diocese $975,000 to resolve claims filed in federal court in June 2016. It is the second of five insurers named in the lawsuit to reach an agreement. The proposed settlement, which must still be approved by a judge, would be used to continue litigation against the remaining insurers with the goal of obtaining monetary damages for victims of child sexual abuse, according to court documents. The diocese filed for bankruptcy in December 2015 in the wake of a $4.9 million verdict in the first case to go to trial under the Minnesota Child Victims Act. It sued the five insurers six months later, seeking to force coverage of 125 abuse claims received in the bankruptcy case.