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Credit repair services provider Progrexion filed for bankruptcy after losing a court decision to dodge $2.7 billion in payments requested by the Consumer Financial Protection Bureau (CFPB), WSJ Pro Bankruptcy reported. The Utah-based owner of Credit.com, Creditrepair.com and the Lexington Law brand on Sunday sought protection from its more than 100,000 creditors in the U.S. Bankruptcy Court in Wilmington, Del. Progrexion, backed by investment firm Prospect Capital, has been fighting a lawsuit brought by the CFPB since 2019 when the consumer protection bureau accused the company of violating telemarketing sales rules by requesting and receiving payments of prohibited upfront fees for services. Progrexion has denied the allegations. The CFPB said that companies may charge fees for telemarketed credit repair services only after providing consumers with proof that the promised results have been achieved.

FTX Trading Ltd. cannot join confidential mediation sessions between bankrupt crypto lender Genesis Global Holdco and its parent company Digital Currency Group, a judge ruled yesterday, Bloomberg News reported. Bankruptcy Judge Sean Lane declined to open the settlement talks to FTX, which is also in bankruptcy and claims that Genesis owes it $3.9 billion. Instead, Lane gave Genesis, a group of its biggest creditors and DCG more time to come up with a revised payout proposal. Any agreement would form the basis of a chapter 11 bankruptcy plan to pay hundreds of thousands of Genesis creditors. In doing so, Lane has overruled the objections of FTX and several Genesis customers. About two dozen individuals had emailed the judge, urging him to immediately end the settlement talks and order payouts to creditors. Some creditors complained that they hadn’t been given any information about what’s happening with their claims. “There will be a certain amount of radio silence because mediation needs that to work,” Judge Lane said. “Shortening the mediation does not shorten the case.” Meanwhile, Genesis has said that it’s planning to update its current reorganization plan. Once that plan is filed, creditors will be asked to vote on it. Lane will then take those votes into consideration when he decides whether to approve the proposal.

Mallinckrodt’s stock fell by 40% Monday after the drugmaker said it is in talks with creditors about options including a second bankruptcy filing to fix its balance sheet and address a $200 million payment due this month under a previous chapter 11 restructuring, WSJ Pro Bankruptcy reported. The Wall Street Journal reported on Friday that Mallinckrodt has engaged with at least one creditor group to discuss restructuring options that could include another chapter 11 filing to deal with the coming settlement payment related to past sales of opioids. The Dublin-based company confirmed in a securities filing Monday that it has received offers from various creditor groups for restructuring proposals to be implemented both out-of-court and through chapter 11. The company said that its board is “actively evaluating this situation and considering options, including transactions that have been proposed by the holders and other company stakeholders.” Mallinckrodt’s stock was trading at $1.47 midday Monday, down 40% from Friday’s close.

A bankruptcy judge allowed sexual-abuse survivors to resume lawsuits against parishes and other affiliates of the Diocese of Rockville Centre in suburban Long Island, N.Y., that have been paused since its chapter 11 filing in 2020, WSJ Pro Bankruptcy reported. Judge Martin Glenn, who is presiding over the bankruptcy case of the Catholic Church’s seat in Long Island, denied the Diocese’s request to extend a stay on litigation to freeze state-court lawsuits targeting its parishes and other related entities. Negotiations between abuse survivors and the Diocese broke down months ago after it filed a settlement plan that the victims committee said it considers inadequate. The judge’s decision, which takes effect after June 15, would affect 228 out of 490 abuse lawsuits pending against the Diocese, its parishes and other related entities. “As it has throughout the Chapter 11 process, the Diocese will continue to seek and work toward a global settlement of all claims that fairly compensate survivors and allows the Diocese and parishes to continue their missions,” a Diocese spokesman said on Friday. Lawyers representing the victims committee said the court acknowledged the harm to survivors caused by delaying their rights to pursue their claims against the parishes, which are separate corporations that haven’t filed for bankruptcy. Rockville Centre is among a handful of dioceses in New York that filed for chapter 11 protection in 2020 after state lawmakers opened a temporary window to allow victims the opportunity to file time-barred civil cases over childhood sexual abuse. Several bankruptcy cases filed by Catholic dioceses, including Rockville Centre, in recent years have dragged on mired in litigation often with insurers with hundreds of millions of dollars on the line.

Pharmaceutical company Mallinckrodt Plc is considering options including filing for bankruptcy again as a $200 million opioid settlement payment is due within weeks, the Wall Street Journal reported on Friday, according to Reuters. The drugmaker is required to make the payment to an opioid-victims compensation trust by mid-June as part of its chapter 11 exit plan, the newspaper said. The company filed for bankruptcy protection nearly three years ago. It reached a $1.7 billion nationwide settlement as part of its bankruptcy reorganization plan and emerged from chapter 11 last year. Shares of Mallinckrodt closed 5.4% lower at $2.45 apiece on Friday. The stock has plunged 68% so far this year.

FTX Trading Ltd. and its affiliates joined a smattering of other creditors of bankrupt crypto lender Genesis Global Holdco in objecting to extending court-mediated settlement talks, according to a court filing, Bloomberg News reported. Claiming to be a major Genesis creditor, FTX said it hadn’t been invited to court-appointed mediation that went on in May and included Genesis, its parent company Digital Currency Group and creditors such as crypto exchange Gemini Trust Co. FTX also said it was caught off guard when Genesis filed on Thursday to have FTX’s unliquidated claims estimated at zero. FTX says it is owed $3.9 billion. Genesis said that throwing out the FTX claims “is critical to avoid undue delay in the timing and amount of creditor distributions, and to expeditiously pursue confirmation of a chapter 11 plan.” The objection adds yet another complication to the attempts for a settlement between DCG, Genesis and its creditors. FTX is joining more than a dozen other individual Genesis creditors who have filed their objections to extending the mediation. Genesis is seeking to continue the talks through June 16, and claims to have the support of DCG and Gemini. A hearing on the extension is scheduled for Monday. Because FTX hasn’t been included, “the mediation is a waste of estate resources without the inclusion of the FTX Debtors and should not continue without the FTX Debtors’ involvement,” FTX said in its filing.

Three chemical companies said Friday they had reached a $1.18 billion deal to resolve complaints of polluting many U.S. drinking water systems with potentially harmful compounds known as PFAS, the Associated Press reported. DuPont de Nemours Inc., The Chemours Co. and Corteva Inc. said they would establish a fund to compensate water providers for contamination with the chemicals used widely in nonstick, water- and grease-resistant products, as well as some firefighting foams. Described as “forever chemicals” because they don't degrade naturally in the environment, PFAS have been linked to a variety of health problems, including liver and immune-system damage and some cancers. The compounds have been detected at varying levels in drinking water around the nation. The Environmental Protection Agency in March proposed strict limits on two common types, PFOA and PFOS, and said it wanted to regulate four others. Water providers would be responsible for monitoring their systems for the chemicals.

More than three dozen Buffalo (N.Y.) Diocese properties could soon be appraised for current values that ultimately may factor heavily into a settlement with sexual abuse claimants in the diocese’s chapter 11 bankruptcy court, the Buffalo News reported. Lawyers for the diocese are asking a federal judge to approve a request to hire KLW Appraisal Group to come up with valuations for 37 properties spread across six counties. The properties vary from 15 acres of vacant land in the Town of Hamburg near the Erie County Fairgrounds to a historically significant four-story office building in the heart of Buffalo’s medical corridor. They also include six school buildings, two retirement homes for priests, St. Joseph Cathedral, and the former Christ the King Seminary in Aurora. They were estimated collectively to be worth $16 million in 2020 when the diocese first sought chapter 11 bankruptcy protection in response to more than 200 Child Victims Act lawsuits alleging clergy and other diocese employees sexually abused children decades ago, according to a disclosure statement at the time. But the court papers also indicated that most of the properties had not undergone a recent appraisal.

SVB Securities management is in talks to buy back the investment bank from bankrupt SVB Financial Group, Bloomberg News reported. SVB Securities Chief Executive Officer Jeff Leerink and his team are preparing to announce a deal for the firm in the coming days, pending approval from the U.S. Bankruptcy Court for the Southern District of New York, said the people, who asked to not be identified because the matter isn’t public. No final decision has been made and talks could still fall apart. SVB Securities spent heavily in recent years hiring talent across Wall Street to build a competitive investment banking franchise, which was particularly strong in the health-care and technology sectors. The firm advised on about $9 billion in mergers and acquisitions last year, according to data compiled by Bloomberg. Bloomberg News first reported in March that the management of SVB Securities was exploring buying back the firm after Silicon Valley Bank was seized by regulators. SVB Financial, the former parent of Silicon Valley Bank, filed for bankruptcy in March, though SVB Securities and venture capital arm SVB Capital weren’t included in the filing.

Johnson & Johnson yesterday faced the first trial in almost two years over claims that asbestos in its baby powder and other talc products causes cancer, as it seeks to settle thousands of similar cases in bankruptcy court. Emory Hernandez says that he developed mesothelioma, a deadly cancer, in the tissue around his heart as a result of exposure to J&J's talc products beginning when he was a baby. The company has denied that its talc contains asbestos, which is linked to mesothelioma, or causes cancer. Joseph Satterley, a lawyer for Hernandez, urged jurors in Alameda County, California court to reject the company's defenses and hold it responsible for his client's illness. Allison Brown, a lawyer for J&J, said in her opening statement that the company went to great lengths to ensure that there were no contaminants in its talc. She said that Hernandez's form of mesothelioma was very rare, and more likely related to a family history of heart disease and cancer. J&J subsidiary LTL Management in April filed for bankruptcy in Trenton, New Jersey proposing to pay $8.9 billion to settle more than 38,000 lawsuits, and prevent new cases from coming forward in the future. It is the company's second attempt to resolve talc claims in bankruptcy, after a federal appeals court rejected an earlier bid. Litigation has largely been halted during bankruptcy proceedings, but U.S. Chief Bankruptcy Judge Michael Kaplan, who is overseeing LTL's chapter 11, allowed Hernandez's trial to go ahead because he is only expected to live a short time.