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Alex Mashinsky, founder and former CEO of bankrupt cryptocurrency lender Celsius Network, pleaded not guilty yesterday to U.S. fraud charges that he misled customers and artificially inflated the value of his company's propriety crypto token, Reuters reported. Three federal regulatory agencies also sued Mashinsky and Celsius in connection with the case. Mashinsky was charged with seven criminal counts — including securities fraud, commodities fraud and wire fraud — according to an indictment unsealed earlier on Thursday. He is one of several crypto moguls to be indicted in another blow for the industry, which is undergoing a reckoning after a slump in crypto prices led to the collapse of several companies, including exchange giant FTX. That company's founder, Sam Bankman-Fried, was charged with fraud last year, and has pleaded not guilty. U.S. Magistrate Judge Ona Wang said Mashinsky would be released on a $40 million bond secured by his Manhattan residence.

FTX filed a lawsuit on Wednesday against former managers of a Swiss business the bankrupt cryptocurrency exchange had acquired, looking to claw back at least $323 million to repay creditors and customers, WSJ Pro Bankruptcy reported. The lawsuit filed in the U.S. Bankruptcy Court in Wilmington, Del., alleged FTX overpaid for Digital Assets DA AG, the Swiss company that later became FTX Europe following a series of transactions in 2020 and 2021, despite knowing it “had limited business and no intellectual property beyond a business plan.” The new management overseeing FTX’s bankruptcy said in the lawsuit that the FTX Europe business has little value and is unlikely to be sold. The defendants are Digital’s co-founders and a Digital employee and shareholder before the FTX acquisition. FTX bought the Swiss company hoping to gain access to regulators to make it easier to do business and expand its customer base in Europe, FTX said in the lawsuit. In reality, the business didn’t have and never got the type of licenses that would have been useful to FTX in Europe, the lawsuit said.

Johnson & Johnson has sued four doctors who published studies citing links between talc-based personal care products and cancer, escalating an attack on scientific studies that the company alleges are inaccurate, Reuters reported. J&J's subsidiary LTL Management, which absorbed the company's talc liability in a controversial 2021 spinoff, last week filed a lawsuit in New Jersey federal court asking it to force three researchers to "retract and/or issue a correction" of a study that said asbestos-contaminated consumer talc products sometimes caused patients to develop mesothelioma. J&J is facing more than 38,000 lawsuits alleging that the company's talc products, including its Baby Powder, were contaminated by asbestos and caused cancers including ovarian cancer and mesothelioma. J&J is attempting to resolve those lawsuits, as well as any future talc lawsuits, through an $8.9 billion settlement in bankruptcy court. J&J has stopped selling talc-based Baby Powder in favor of cornstarch-based products, citing an increase in lawsuits and "misinformation" about the talc product's safety. The company in 2021 began exploring bankruptcy as a potential solution to the lawsuits, which saw a mixed record at trial, including several defense wins but also a $2.1 billion verdict awarded to 22 women who blamed their ovarian cancer on asbestos in the company's talc products. J&J said in bankruptcy court filings in April that the costs of its talc-related verdicts, settlements and legal fees have reached about $4.5 billion.

Lawyers for a California man who says he developed a rare cancer from exposure to asbestos in Johnson & Johnson's talc-based baby powder on Monday urged a jury to order the company to pay heavy punitive damages, calling its conduct negligent and "despicable," Reuters reported. "A reasonably careful corporation would not sell a product that allowed carcinogens to be applied to babies," Joseph Satterley, a lawyer for Emory Hernandez Valadez, said in a closing argument at the end of a six-week trial in Alameda County Superior Court in California. J&J has consistently denied that its now-discontinued talc baby powder contains asbestos or causes cancer. Satterley asked jurors to award Hernandez punitive damages about nine times greater than so-called compensatory damages, which include $3.8 million for his medical costs as well as damages for pain and suffering. Satterley said the pain and suffering damages should be much larger than the medical costs. The U.S. Supreme Court has found that punitive damages should generally be no more than nine times compensatory damages, and that a higher ratio can be reduced on appeal as excessive. J&J's lawyers told the jury Monday that there was no evidence presented at the trial linking Hernandez's cancer to talc, and that the company had always gone out of its way to test its talc and ensure its safety.

Shareholders are suing Mallinckrodt, alleging the struggling pharmaceutical company made false and misleading statements about its financial health that resulted in investor losses, the Wall Street Journal reported. The company and three executives named in the suit received a court summons on Monday ordering them to appear in court within 21 days. Continental General Insurance and Percy Rockdale, plaintiffs who bought Mallinckrodt shares both this year and last year, said in a class-action complaint filed Friday that the company overstated its financial standing. The lawsuit cited Mallinckrodt’s statements about alleged improvements to its liquidity and balance sheet as well as its ability to fulfill obligations under a $1.7 billion opioid-related settlement agreement with state and local governments. Mallinckrodt last month delayed a $200 million payment to the opioid settlement trust. The company also missed interest payments to its bondholders, warning that it may need to file for bankruptcy a second time.

A U.S. judge said yesterday that he would consider dismissing the bankruptcy of a New York Roman Catholic diocese if the church cannot build more support among sexual abuse victims who have sued the church and its parishes, Reuters reported. Bankruptcy Judge Martin Glenn said during a court hearing in Manhattan that he was not eager to be the first judge to kick a Catholic diocese out of bankruptcy. But if the Diocese of Rockville Centre cannot make progress toward a comprehensive settlement of sexual abuse claims, it would be unfair to prevent abuse survivors from resuming their lawsuits in other courts, Judge Glenn said. "The survivors deserve an opportunity to be heard by a jury of their peers," Glenn said. "They've been held off too long." The diocese filed for chapter 11 bankruptcy in New York in October 2020, citing the cost of lawsuits filed by childhood victims of clergy sexual abuse. New York's Child Victims Act, which took effect in August 2020, temporarily enabled victims of child sexual abuse to file lawsuits over decades-old crimes. At least 20 other dioceses have filed for bankruptcy in response to New York's law and similar laws passed in other U.S. states. The diocese has estimated that its bankruptcy plan would provide between $185 million and $200 million in value to abuse survivors.

BlockFi Inc.’s past business with FTX appeared legitimate and gave management no reason to worry about lending to Sam Bankman-Fried’s crypto platform before it melted down amid allegations of fraud last year, according to a probe by independent BlockFi directors and its lawyers, Bloomberg News reported. Findings of the seven month investigation were made public Monday in New Jersey bankruptcy court to support a BlockFi settlement that would resolve potential legal claims related to the crypto lenders’ collapse against co-founders Zac Prince and Flori Marquez, as well as other company officers. Management, in exchange, has agreed to assist company lawyers in potentially lucrative actions against firms they blame for BlockFi’s collapse including FTX and failed crypto hedge-fund Three Arrows Capital. BlockFi management will serve as key witnesses in litigation involving FTX and Three Arrows, the outcome of which could result in $1 billion in value for creditors, the crypto lender said. Prince, Marquez and the other executives have also agreed to waive or reduce recoveries of their personal digital assets on BlockFi’s platform and contribute $2.2 million in cash to the company, according to court documents. The settlement must be approved by a judge.