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Ohio filed a lawsuit against railroad Norfolk Southern to make sure it pays for the cleanup and environmental damage caused by a fiery train derailment on the Ohio-Pennsylvania border last month, the state’s attorney general said Tuesday, the Associated Press reported. The federal lawsuit also seeks to force the company to pay for groundwater and soil monitoring in the years ahead and economic losses in the village of East Palestine and surrounding areas, said Ohio Attorney General Dave Yost. “The fallout from this highly preventable accident is going to reverberate throughout Ohio for many years to come,” Yost said. No one was hurt in the Feb. 3 derailment, but half of the roughly 5,000 residents of East Palestine had to evacuate for days when responders intentionally burned toxic chemicals in some of the derailed cars to prevent an uncontrolled explosion, leaving residents with lingering health concerns. Government officials say tests over the past month haven’t found dangerous levels of chemicals in the air or water in the area. Norfolk Southern CEO Alan Shaw apologized before Congress last week for the impact the derailment has had on the area, but he didn’t make specific commitments to pay for long-term health and economic harm.

Since at least 2009, McKinsey & Co. has been a consultant to the U.S. Department of Veterans Affairs, the federal agency that oversees healthcare for millions of retired military service members. During part of that time, the consulting giant also advised some of the world’s biggest opioid producers to target the agency for sales of their products, according to newly released documents, WSJ Pro Bankruptcy reported. The firm advised opioid companies including Purdue Pharma LP and Endo International PLC on how to increase sales to the VA through both new and existing channels, the documents show. Meanwhile, McKinsey earned at least $117 million consulting for the VA, primarily on matters related to healthcare services for veterans, according to government records. Purdue and Endo both filed for bankruptcy in recent years to shield themselves from mass lawsuits alleging they fueled the opioid crisis, while McKinsey’s work for those companies and others subjected it to litigation of its own. The firm in 2021 reached a $642 million settlement of opioid-related lawsuits from all 50 state attorneys general, in which it didn’t admit wrongdoing. It agreed in the settlement to make public certain documents concerning its past work for opioid companies and began releasing records last year. The documents establish that McKinsey identified the VA as an important sales target for its corporate clients in the opioid industry, at a time that the firm also did consulting work for the agency.

U.S. regulators took control of a second bank Sunday and announced emergency measures to ease fears depositors might pull their money from smaller lenders after the swift collapse late last week of Silicon Valley Bank, the Wall Street Journal reported. The measures, which include guaranteeing all deposits of SVB, were designed to shore up wavering confidence in the banking system. They were jointly announced Sunday night by the Treasury Department, the Federal Reserve and the Federal Deposit Insurance Corp. Regulators announced they had taken control of Signature Bank, one of the main banks for cryptocurrency companies, on Sunday. The New York bank’s depositors will be made whole, officials said. A senior Treasury official said that the steps didn’t constitute a bailout because stock and bondholders in SVB and Signature wouldn’t be protected. The Fed and Treasury separately said they would use emergency-lending authorities to make more funds available to meet demands for bank withdrawals, an additional effort to prevent runs on other banks. Read more. (Subscription required.)

In related news, bankrupt crypto lender BlockFi Inc. faces risks of having its funds locked up at Silicon Valley Bank, which collapsed Friday after a run on deposits doomed the bank’s plans to raise fresh capital, WSJ Pro Bankruptcy reported. BlockFi, which filed for bankruptcy in November, had roughly $227 million in unprotected funds at the bank, the U.S. Trustee, a unit at the Justice Department overseeing bankruptcies, said in a court filing Friday. The federal watchdog said Silicon Valley Bank documents clearly show the BlockFi account isn’t considered a deposit, isn’t insured by the Federal Deposit Insurance Corp., and might lose value. BlockFi ignored warnings earlier this month about the dangers of the uninsured account, the federal watchdog said. The watchdog said it had urged BlockFi to show that it has taken steps to safeguard the money that was held in the unprotected money-market mutual fund at the bank. Silicon Valley Bank is a popular bank for deposits, lending and other services for businesses in chapter 11, court documents show, adding another dimension to the bank’s collapse that marks the second-biggest failure in a financial services firm in U.S. history. Read more.

The closure of Signature Bank, a lender that counted a number of crypto companies as customers, marks another major setback for digital assets as the industry becomes ever more cut off from the banking system, Bloomberg News reported. The Treasury Department said Signature Bank was closed by New York state regulators Sunday and that depositors will have access to their money on Monday. The shutdown comes soon after the twin collapses of Silvergate Capital Corp. and Silicon Valley Bank. All the banks were, at least at one point, counted among the U.S.’s most crypto-friendly financial institutions. Signature had begun a pull back from digital assets in the wake of the blowup of the FTX exchange but still had $16.5 billion in crypto-related client deposits as of March 8. Signature and Silvergate also enabled fast payments between customers like hedge funds and exchanges, supporting digital-asset liquidity. Coinbase Global Inc., the U.S.’s biggest crypto exchange, said on Friday night that it had a $240 million balance at the bank. Paxos Global, which had previously partnered with Binance on the BUSD stablecoin, said it had $250 million at Signature. In the tweet, Paxos said it “holds private deposit insurance well in excess of our cash balance and FDIC per-account limits.”

The U.S. Department Justice has appealed a court order approving Voyager Digital's bankruptcy plan, creating a new hurdle for the crypto lender's plan to sell its assets and transfer its customers to Binance.US in a deal valued at $1.3 billion, Reuters reported. The U.S. Attorney's Office for the Southern District of New York and the Office of the U.S. Trustee, the Department of Justice's bankruptcy watchdog, filed a notice of appeal late Thursday in U.S. bankruptcy court in Manhattan. It did not detail why they were appealing. Bankruptcy Judge Michael Wiles, who is overseeing Voyager's chapter 11 bankruptcy process, had approved Voyager's restructuring plan, which is built around the acquisition by crypto exchange Binance.US, at a hearing on Tuesday after overruling objections from the U.S. Securities and Exchange Commission and DOJ. Lawyers for the U.S. Trustee and U.S. Attorney's office spoke up at hearings to consider Voyager's bankruptcy plan to oppose provisions Voyager included to protect employees from potential legal claims resulting from actions taken during the bankruptcy. They argued that Wiles' order approving the plan was written too broadly, potentially preventing the government from bringing regulatory enforcement actions or criminal charges if misconduct was discovered later. Judge Wiles disagreed, saying that Voyager and its employees should not be penalized for carrying out a court-approved sale to Binance.US. If the DOJ or any government agency had evidence of misconduct specifically related to the bankruptcy, they should have presented it in court, Judge Wiles said.

The Diocese under the Roman Catholic Bishop of Santa Rosa will be filing for bankruptcy Monday due to the large number of lawsuits filed against it from people who allege they were sexually abused, Bishop Robert Vasa said Friday, Patch.com reported. The lawsuits came in the wake of a three-year window declared by Gov. Gavin Newsom beginning in 2020 and ending on Dec. 31, 2022, that overruled the normal statute of limitations and opened the floodgates for litigation. According to the Catholic News Agency, Newsom's move allowed for suits to be brought that have gone back up to 75 years. For the Santa Rosa Diocese, the number of suits could be as many as 200, with 115 dating back more than 30 years. "These cases are too numerous to settle individually and so they have accumulated until the closing of the three-year window," Vasa said on Friday in his statement. "Now that the window is closed, we have received notice of at least 160 claims and we have information that perhaps more than 200 claims have been filed in total against the Diocese."

Binance’s American affiliate won court approval to take over thousands of customer accounts from bankrupt crypto platform Voyager Digital Ltd. despite warnings that the Binance.US exchange faces possible regulatory action, WSJ Pro Bankruptcy reported. Judge Michael Wiles of the U.S. Bankruptcy Court in New York approved the companies’ deal, undeterred by the revelation last Friday that Securities and Exchange Commission staff have determined that Binance.US, the American affiliate of the world’s largest crypto exchange, is operating an unregistered securities exchange. The SEC staff’s view that Binance operates an unregistered exchange in the U.S. hasn’t been affirmed by the agency’s commissioners but indicates the SEC could take enforcement action. Judge Wiles on Tuesday said he couldn’t delay the deal between Voyager and Binance.US simply because the SEC is warning about possible future enforcement, especially since the agency didn’t present any evidence the companies could rebut. “The SEC didn’t say why they say Binance.US is operating as a securities broker. If we were to try to address the issue we’d have to guess,” Judge Wiles said in his ruling. The judge’s ruling clears the way for Voyager to transfer roughly $1 billion in cryptocurrency it holds to Binance.US, where customers would receive new accounts to access some of the assets that have been frozen since Voyager filed for chapter 11 last year. In court hearings that began last week, Judge Wiles considered Voyager’s plan to sell its customer accounts to Binance.US, wind up the bankruptcy case and distribute what remains of the business to its customers. U.S. state and federal regulators have voiced doubts about the viability of the proposed deal, citing risks from pending regulatory investigations of Binance.US.

Federal appeals court judges in Washington, D.C., grilled the U.S. Securities and Exchange Commission on its decision to reject a proposed Bitcoin exchange-traded fund when it had earlier approved a similar product based on Bitcoin futures, Bloomberg News reported. Grayscale Investments LLC wants to convert its $14 billion Bitcoin trust, the largest investment vehicle tied to the No. 1 cryptocurrency, into an ETF. But the SEC rejected the plan in June, saying crypto markets are too ripe for fraud and manipulation. Grayscale sued, asking the DC Circuit Court to overturn a decision the company called arbitrary and discriminatory because the SEC had already approved ETFs that track Bitcoin futures. Chief Circuit Judge Sri Srinivasan, one of three on the appellate panel, asked during a hearing Tuesday why it wouldn’t always be the case that manipulation of the spot Bitcoin market would show up in futures. “It is just going to follow like the night follows the day,” Srinivasan said while questioning an SEC lawyer. Some of the judges pushed the SEC to explain why Grayscale is wrong to argue the risks of fraud and manipulation in the spot Bitcoin and Bitcoin futures markets are the same because they both rely on the same underlying pricing.

Revlon Inc. is grappling with a growing number of allegations that some of its hair products cause cancer as the cosmetics company looks to exit chapter 11 protection, Bloomberg News reported. Thousands of consumers are alleging Revlon owes them money because they used the company’s hair relaxer products and later developed cancer. But a deadline to formally lodge such claims against the bankrupt company elapsed in October — just after the National Institutes of Health published a study showing a correlation between some chemical hair relaxers and uterine cancer. On Tuesday, Revlon’s bankruptcy judge extended the deadline by which customers with certain types of cancer can file claims against the company. They now have until April 11, which will also allow them to vote on the bankrupt company’s restructuring plan later this month. “What we’ve got here in my view is a mass tort in the making,” said Sander Esserman, an attorney who spoke on behalf of various cancer claimant groups during the Tuesday bankruptcy hearing. “It’s a dynamic situation, and there will no doubt be many cases in the future as they continue to market and the women develop various forms of cancers that are contestable.” Robert Britton, an attorney representing Revlon, said the company disputes any link between cancer and its hair relaxer products. He added that the exponential growth of claims in a matter of weeks suggests that more vetting of the claimants might be needed.

A New Jersey town sued the American Dream mall and entertainment complex over its refusal to make about $7.5 million in property tax-like payments and $400,000 for sewer service, Bloomberg News reported. American Dream’s owner Triple Five Group agreed to make the payments in lieu of real estate taxes to the borough of East Rutherford on land surrounding the mall in exchange for rights to build a hotel, minor league baseball stadium and offices. The payments to East Rutherford, home to the $5 billion project, were supposed to commence once the mall opened to the public, according to a March 3 complaint filed by the town in Superior Court of New Jersey. The borough said in the lawsuit that American Dream has “dubiously asserted” that the complex — which has hosted millions of guests and touted visits by reality television stars like Kim Kardashian — isn’t open for business to the general public. “The truth is simple: Defendants would prefer not to pay the borough because American Dream opened shortly before the COVID-19 pandemic, closed for a matter of months, and — according to widely circulated reports in the press — has struggled financially,” the town said in the complaint. American Dream intends to vigorously defend its position, said Jessica Griffin, a spokeswoman. American Dream, located across the Hudson River from New York City, opened the doors of its entertainment complex in October 2019, almost two decades after a mall on the site was first proposed. Five months later, the pandemic spurred lock-downs to contain the public-health emergency and postponed the opening of the mall’s retail stores until October 2020.