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Supreme Court Justice Samuel Alito on Friday temporarily halted the Boy Scouts of America's $2.46 billion settlement of decades of sex abuse claims, which is being appealed by a group of 144 abuse claimants, Reuters reported. Alito's brief order freezing the settlement gives the court more time to decide a Feb. 9 request by these abuse claimants to block the settlement from moving forward. They contend the deal unlawfully stops them from pursuing lawsuits against organizations that are not bankrupt, such as churches that ran scouting programs, local Boy Scouts councils and insurers that provided coverage to the Boy Scouts organization. Justice Alito stepped in to halt the settlement because he handles certain requests involving cases from a group of states including Delaware, where the Boy Scouts matter was decided. The settlement involves more than 82,000 men who have said they were abused as children by troop leaders while in the Boy Scouts. Doug Kennedy, an abuse survivor who co-led the official committee representing abuse claimants in the bankruptcy, called the delay a "horrible" result. Survivors have already waited for decades for their abuse to be addressed, and 86% of abuse survivors voted to support the Boy Scouts settlement in bankruptcy court, Kennedy said. The trustee in charge of administering the Boy Scouts settlement, retired bankruptcy judge Barbara Houser, said Alito's order will suspend all work on the settlement, including evaluating claims and mailing checks to abuse survivors. The settlement trust has already paid nearly $8 million to more than 3,000 men. The Boy Scouts of America noted that Alito's order was only a short-term measure and said that it hopes the Supreme Court will swiftly deny the request for a longer pause, which would "inflict severe harm on both the Scouting movement and Scouting-abuse survivors."

FTX investors sued Sullivan & Cromwell, accusing the law firm of aiding illicit schemes that helped advance a multi-billion dollar fraud before the crypto exchange’s collapse, Bloomberg News reported. Sullivan & Cromwell’s services “went well beyond those a law firm should and ordinarily provides,” the investor complaint said. “Lawyers were eager to craft not only creative but misleading strategies that furthered FTX’s misconduct.” The lawsuit filed on Friday on behalf of a proposed class of FTX customers adds to scrutiny of the elite Wall Street law firm that has acknowledged working on 20 legal matters for FTX and its founder Sam Bankman-Fried in the 16 months before the exchange’s 2022 implosion amid reports of a liquidity crisis. The Moskowitz Law Firm, which is behind actions against Tom Brady and other celebrity endorsers of FTX, brought the suit in Miami federal court. The firm “actively participated” in the FTX fraud through legal work that gave it deep insight into the exchange’s inner workings, investors allege. Firm lawyers knew where customer money was held and about the “untruthful and fraudulent conduct and misappropriation” of the money, the investors claim. The lawsuit makes Sullivan & Cromwell the second law firm to face an investor litigation over allegedly aiding and abetting the FTX fraud. Fenwick & West, a Silicon Valley law firm which worked as the crypto exchange’s main corporate counsel, is facing a separate action along with venture and private equity firms such as Sequoia Capital, Thoma Bravo and Paradigm. Bankman-Fried in November was convicted of fraud and conspiracy for siphoning customer money into an affiliated hedge fund for risky investments, political donations, and expensive real estate.

The Boy Scouts of America asked the U.S. Supreme Court to reject a plea by some sex-abuse victims to put on hold a $2.4 billion settlement that allowed the youth organization to exit bankruptcy last year, WSJ Pro Bankruptcy reported. In a response filed late Thursday, lawyers for the Boy Scouts said that putting a stop to the distribution of funds to abuse victims that got under way last year would be unfair to the more than 99% of survivors who are not seeking to stay the Boy Scouts’ chapter 11 plan. A fraction of more than 82,000 survivors who filed sex-abuse claims against the organization asked the Supreme Court in recent weeks to suspend settlement payments while the court reviews a challenge to opioid maker Purdue Pharma’s bankruptcy plan. Lawyers pushing to pause the Boy Scouts settlement payments argued that a central feature of the Boy Scouts deal is similar to Purdue Pharma’s chapter 11 plan that is under an expedited review in the U.S. Supreme Court. Both restructuring plans would grant legal immunity to third parties who themselves didn’t file for bankruptcy but have close ties to the organizations. The Purdue settlement releases the company’s Sackler family owners from future liabilities related to opioid addiction in return for payments of up to $6 billion over time. Similarly, the Boy Scouts settlement shields the youth organization’s local councils and its partner organizations, which sponsor most scouting activities, from future sex-abuse claims.

About a year and half ago, a small San Antonio pharmacy found itself in Bexar County’s crosshairs, targeted because of the huge amount of pain pills it dispensed. A lawyer for the county dubbed it a “pill mill.” So Trinity Pharmacies LLC was added to a 2018 lawsuit targeting drug manufacturers, a distributor and various retailers that officials said were fueling the opioid addiction crisis sweeping the San Antonio area. The litigation — in which Trinity is charged alongside retail giants such as CVS, Walgreens and Walmart — became too costly for Trinity. So, on Feb. 4, it sought chapter 11 bankruptcy protection, the San Antonio Express-News reported. “It can’t, your honor, sustain the litigation costs,” Trinity lawyer H. Anthony Hervol told Chief U.S. Bankruptcy Court Craig Gargotta during a hearing Wednesday. The pharmacy has racked up more than $40,000 in legal fees defending itself in the massive multi-district litigation that’s unfolding in Harris County District Court. The bankruptcy puts the county’s lawsuit against Trinity on hold. But the filing under a subchapter of the bankruptcy code designed for small-business debtors is part of a larger legal strategy its owners hope will eventually do away with the causes of action against it. The county's claims against Trinity and other retailers include: negligent and/or intentional creation of a public nuisance; common law fraud; and civil conspiracy. The county seeks to recover from defendants its costs associated with the opioid epidemic and punitive damages.

Lawyers representing a group of sex-abuse victims with claims against the Boy Scouts of America are asking the U.S. Supreme Court to pause payments to survivors from a $2.4 billion settlement fund created as part of the youth organization’s bankruptcy plan, WSJ Pro Bankruptcy reported. The lawyers, who represent a fraction of over 82,000 Boy Scouts sex-abuse plaintiffs, argued that since a central feature of the youth organization’s settlement is being litigated in the U.S. Supreme Court in the challenge to Purdue Pharma’s similar bankruptcy plan, the Boy Scouts plan should be suspended until the high court reaches a decision in the opioid maker’s case, according to court papers filed on Wednesday. Federal courts last October rejected earlier efforts by the same lawyers to suspend the Boy Scouts bankruptcy plan. U.S. District Judge Richard Andrews in Wilmington, Del., said then that unlike Purdue’s bankruptcy plan, the youth group’s reorganization had already gone into effect and many of the transactions it contemplated had already happened. The Supreme Court is set to examine on an expedited basis the issue of legal immunity granted in the Purdue reorganization plans that is also a key feature in the Boy Scouts settlement: whether bankruptcy courts can extinguish legal claims against third parties that aren’t in chapter 11 without the consent of all claimants.

Bankruptcy Judge Paul Warren said at a hearing last week that neither plan proposed in the Rochester Diocese bankruptcy can move forward for a vote yet, the Rochester Beacon reported. Instead, he set an Apr.16 date for the hearing to be continued. It would be the hearing’s second continuation and third session. Judge Warren had previously called off an early October hearing that was to have dealt with the rival plans. Accounting for much of the complication is that insurance companies balked at payment amounts survivors sought as compensation. By the end of last year only one insurer, the Continental Insurance Co., also known as CNA, had not come to terms. Instead it offered a rival plan of reorganization to a joint plan offered earlier by the diocese and a committee representing survivors. The survivors’ committee has made it clear that it sees CNA’s plan as an inadequate take-it-or- leave-it offer. The court’s go ahead on a vote on one or both plans after the April 16 date assumes the diocese and CNA will have met series of conditions the judge laid out, many having to do with more clearly explaining legal issues to the nearly 500 abuse survivors who account for most of the diocese’s creditors.

A U.S. appeals court on Monday refused to dismiss a Georgia doctor's lawsuit claiming that Bayer AG's Roundup weedkiller caused cancer, the latest setback in the German company's efforts to fend off thousands of similar cases carrying potentially billions of dollars in liability, Reuters reported. A three-judge panel of the Atlanta-based U.S. Court of Appeals for the Eleventh Circuit rejected Bayer's argument that federal regulators' approval of Roundup shielded the company from being sued under state law for failing to warn consumers of the product's risks. Several other appeals courts had previously reached the same conclusion in similar lawsuits. If the 11th Circuit had broken with those other courts, it would have made it more likely for the U.S. Supreme Court to take up the issue. Bayer has said that it hopes a favorable Supreme Court ruling could limit its liability from the Roundup-related litigation, but the court has so far rebuffed its appeals. David Carson, the plaintiff, said in his lawsuit he was diagnosed with a type of cancer called malignant fibrous histiocytoma in 2016 after using Roundup for 30 years. Roundup-related lawsuits have dogged Bayer since it acquired the brand as part of its $63 billion purchase of Monsanto in 2018. The company settled most Roundup claims that were pending against it in 2020 for up to $10.9 billion, but still faces more than 50,000 claims over the product. Most plaintiffs allege that Roundup caused a type of cancer called non-Hodgkins lymphoma, though some say it caused other cancers. Bayer maintains that Roundup is safe and does not cause cancer.

Sen. Elizabeth Warren (D-Mass.) has asked the Justice Department’s bankruptcy watchdog to join forces with the tort claimants committee in its appeal to throw out prison healthcare provider Tehum Care Services’ chapter 11 case, WSJ Pro Bankruptcy reported. Warren on Wednesday sent a letter to Tara Twomey, director of the Executive Office for U.S. Trustees, and Kevin Epstein, U.S. Trustee for the Southern and Western District of Texas. In that letter, Warren said the committee, in its motion to dismiss, argued persuasively that the case is a “bad-faith attempt to defraud creditors, many of whom faced serious injury or death” under Corizon Health. Corizon split into two in 2022 — Tehum and operating business YesCare — using a controversial legal tactic known as the Texas Two-Step. Tehum filed for chapter 11 in February last year, carrying into bankruptcy court debts and liabilities to prisoners, healthcare providers, insurance companies and others accumulated by Corizon. YesCare, among the nation’s largest providers of healthcare in prisons and jails, operates business as usual, while malpractice lawsuits filed against Corizon by former and current inmates were paused because of Tehum’s bankruptcy.

Three people have been charged with orchestrating a SIM-swapping scam that siphoned more than $400 million from FTX as the cryptocurrency exchange spiraled into bankruptcy, Bloomberg News reported. Hours after FTX filed for bankruptcy in November 2022, and its founder Sam Bankman-Fried resigned, hackers drained hundreds of millions of dollars worth of digital currency from the platform, before funneling it through a web of decentralized exchanges. Bankman-Fried, who is facing decades in prison after being convicted of fraud late last year, distanced himself from the hack, but speculated that it could have been an inside job. Turns out it wasn’t, prosecutors say. The Department of Justice charged Robert Powell, of Illinois, Emily Hernandez, of Colorado, and Carter Rohn, of Indiana, last month with participating in a SIM-swapping ring that targeted FTX and other individuals over a two year period. SIM swappers have repeatedly identified victims in the crypto world and FTX’s lax security — pointed out by the company’s new CEO after he took over — appeared to make it a prime target. According to the indictment filed in federal court in Washington, D.C., Powell, Rohn and Hernandez collected personal data of about 50 victims and used the information to convince cell phone providers to port the victims’ phone numbers to a dummy phone in their possession. In doing so, the trio could intercept text messages — including multi-factor authentication codes, which allowed them to break into the victims’ financial accounts and crypto wallets. The indictment does not name FTX, but two people familiar with the case confirmed it was in fact “victim company-1” in the court filings.