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A bankruptcy judge on Friday accepted most of the Boy Scouts of America’s $2.7 billion plan for compensating sex-abuse victims, setting the youth group on a path out of the largest chapter 11 case involving childhood abuse, WSJ Pro Bankruptcy reported. Judge Laurie Selber Silverstein in the U.S. Bankruptcy Court in Wilmington, Del., endorsed the key elements of the settlement plan, concluding that it would pay off in full roughly 82,200 individual claims of sexual abuse against the Boy Scouts. She stopped short of granting formal approval to the bankruptcy plan, rejecting some aspects and requiring more information on others. But she broadly endorsed the Boy Scouts’ plan for compensating abuse survivors by seeking contributions from the organization’s local councils, insurers and partner organizations, in return for grants of legal immunity from further abuse-related claims. “Many survivors have been waiting for thirty, forty or even fifty years to tell their stories and receive a meaningful recovery,” the judge said. “This plan makes that happen.” Pending final approval, the bankruptcy plan is expected to end more than two years in chapter 11 where the Boy Scouts dealt with the competing interests of abuse survivors, its liability insurers, and its affiliates and partner organizations. Under the chapter 11 plan, roughly 250 local Scouts councils and partner groups, the lifeblood of scouting activities, will gain legal immunity from related sex-abuse claims by contributing to a settlement fund, the largest ever created to pay sex-abuse victims. Abuse victims, many of whom had lived with the trauma of childhood abuse for decades before stepping forward to file claims in the bankruptcy case, could start to see money flowing within 12 months. Judge Silverstein said on Friday that some aspects of the bankruptcy plan don’t pass muster, and that the Boy Scouts have “decisions to make” about how to proceed.

Johnson & Johnson’s bankrupt subsidiary won court permission to set a price tag on mass litigation linking the company’s talc-based baby powder to cancer, the latest setback for injury claimants who argued the estimation would be “a road to nowhere,” WSJ Pro Bankruptcy reported. Judge Michael Kaplan of the U.S. Bankruptcy Court in Trenton, N.J., said yesterday that he has retained an outside expert to conduct an independent valuation of the roughly 38,000 cancer lawsuits pending against J&J and its talc subsidiary, LTL Management LLC, as well as any additional injury claims that could be brought against the company. The expert, lawyer Kenneth Feinberg, has mediated some of the largest product-liability cases in U.S. history, including the $20 billion settlement related to the BP PLC oil spill. Feinberg is slated to issue a report before Judge Kaplan rules on how much talc-injury claimants are owed. LTL has said estimating the valuation of the lawsuits would move its chapter 11 case forward and foster settlement talks to help resolve the litigation. Judge Kaplan agreed, saying yesterday that Feinberg’s report would aid settlement discussions and rejecting injury claimants’ argument that an estimation proceeding would stall the case. Judge Kaplan said that he wouldn’t set a deadline for Mr. Feinberg to produce his report but that he anticipates he will receive the report “before the weather starts getting cold.”

The federal judge administering more than 230,000 lawsuits against 3M Co. questioned whether the industrial giant acted in good faith when it decided to try to shift the cases to bankruptcy court instead of facing separate jury trials around the U.S., Bloomberg News reported. U.S. District Court Judge M. Casey Rodgers of Pensacola, Fla., held a hearing Wednesday morning about 3M’s decision to put its Aearo Technologies unit into bankruptcy as a way to resolve the lawsuits, which accuse 3M of selling faulty combat earplugs that harmed U.S. soldiers, according to court records. During the discussion, Rodgers said she plans to hold a hearing on whether 3M was acting in good faith during mediation to resolve the lawsuits overseen by one federal court while also preparing to force the same claims into bankruptcy in another federal court, according to a transcript of the hearing. Lawyers for the veterans have attacked 3M’s decision to put Aearo into bankruptcy, saying it is a ploy to deny victims of a faulty product the chance to make their cases to juries. 3M has lost 13 of the 19 test cases that have gone to trial. 3M is not in bankruptcy, but argues it should be protected along with its Aearo subsidiary. 3M plans to funnel $1 billion to a trust that would pay people suing over the earplugs and has set aside $240 million to fund the bankruptcy itself. The strategy is similar to those proposed by other lawsuit-addled companies like Johnson & Johnson and Purdue Pharma LP. In a separate court hearing Wednesday afternoon, U.S. Bankruptcy Judge Jeffrey J. Graham in Indianapolis warned lawyers for Aearo that at least part of their argument for an emergency court order blocking the veterans’ claims is not persuasive.

3M Co. placed its subsidiary that houses its military-grade earplug business into bankruptcy proceedings as it booked a $1.2 billion charge to resolve litigation over alleged defects that are the subject of lawsuits from thousands of military veterans, the Wall Street Journal reported. The move yesterday came as the maker of Scotch tape, Post-It notes and more reported a drop in second-quarter revenue and profit. It cut its full-year sales and earnings outlook as it grapples with a stronger dollar and an uncertain economic environment that impacts consumer spending patterns. The company also disclosed plans to spin out its health care business into a separate, publicly traded company. 3M, based in St. Paul, Minn., said that its Aearo Technologies unit and related business have started chapter 11 proceedings. It has committed $1 billion to fund a trust to pay out claimants during the proceedings and $240 million to fund expected expenses related to the case. 3M said it would provide more funding if required.

The Roman Catholic Diocese of Rochester, N.Y., on Friday objected to nearly 100 claims filed by sexual-abuse survivors in its ongoing chapter 11 bankruptcy, a move that could shave tens of millions off any payout it makes in the case, the Rochester Beacon reported. The objections come late in the nearly three-year-old case and long after the claims were first filed. They also come as tensions between survivors and the diocese build as both sides joust over a settlement offer that survivors scorn as too little, too late. In the offer, the diocese proposes to pay survivors a total of $145.75 million, with its insurance carriers covering $105 million of that amount. Scorning the claim objections as raised on legal technicalities and a contradiction of Rochester Diocese Bishop Salvatore Matano’s professed concern for survivors, an attorney representing survivors in the case vowed to vigorously fight the objections. Such objections in diocesan bankruptcies are “unheard of and a pretty big deal in my opinion,” said Leander James, an attorney representing 76 abuse survivors in the Rochester Diocese bankruptcy. In a statement, the diocese says that it does not question the veracity of survivors’ claims but maintains that it is not responsible for acts committed by parties not legally tied to the diocese, and thus needs to object to the claims as part of its “fiduciary responsibility.” As of July 22, the diocese had filed 97 claim objections. If all were to be disallowed, it would reduce the diocese payout by as much as $30 million.

Endo International PLC is moving toward a bankruptcy filing, potentially setting off intense conflicts with state and local governments that have sued the pharmaceuticals company for its alleged role in fueling the opioid crisis, WSJ Pro Bankruptcy reported. Without a deal with opioid plaintiffs after years of negotiations, Endo is considering filing for bankruptcy as a means to restructure its more than $8 billion of debt and thousands of outstanding lawsuits. The company has been in negotiations with a group of secured creditors since it failed to make interest payments owed to its junior bondholders last month, said the people. Endo is aiming to reach a deal with the secured creditors before it enters a near-term chapter 11 process, though is unlikely to file for bankruptcy with an agreement also in place with its junior bondholders and opioid plaintiffs, the people said, cautioning that the situation is fluid and circumstances may change. Other pharmaceutical companies, including Purdue Pharma LP and Mallinckrodt PLC, have sought bankruptcy protection to resolve opioid liabilities, filing for chapter 11 with settlements in place with most U.S. states.

Teva Pharmaceutical Industries and AbbVie's Allergan unit on Tuesday reached a $58 million settlement with the city of San Francisco just before completion of a trial over claims that they fueled an opioid epidemic in the city, Reuters reported. Under the deal announced by City Attorney David Chiu, Israel-based Teva will pay $25 million in cash and contribute a $20 million supply of the overdose-reversal drug Narcan. AbbVie will pay $13 million. "This will bring significant resources to help with education, prevention and treatment, and the addition of tens of millions of dollars worth of overdose reversal medication will save lives in the Bay Area," said Paul Geller, a lawyer who represented the city in negotiating the settlement. Teva's settlement also resolves the city's claims against Teva-owned drug distributor Anda Inc. San Francisco will receive $54 million, while $4 million will go toward attorneys' fees.

A federal appeals court yesterday revived a lawsuit by a Georgia man claiming Bayer AG's Roundup weedkiller caused his cancer, the latest in a string of legal defeats for the company as it seeks to avoid potentially billions of dollars in damages, Reuters reported. The U.S. Court of Appeals for the 11th Circuit in Montgomery, Ala., rejected Bayer's argument that federal law shielded it from state law claims like the one brought by John Carson, who said he was diagnosed with a type of cancer called malignant fibrous histiocytoma in 2016 after using Roundup for 30 years. Carson said the company should have warned of cancer risk on the product's label. Bayer said that it disagreed with the ruling and would consider its options. It said any cancer warning would be inconsistent with the label approved by the U.S. Environmental Protection Agency. "Bayer continues to stand fully behind its Roundup products," said the company, which acquired the weedkiller line with its $63 billion purchase of Monsanto in 2018. The German conglomerate has said that decades of studies have shown Roundup and its active ingredient, glyphosate, are safe for human use. Another federal appeals court, the 9th Circuit, rejected the same argument in a California lawsuit in 2020. Bayer had hoped that a victory in Carson's case would create a conflict between appeals courts that would make the U.S. Supreme Court more likely to take up the issue, potentially limiting its liability in thousands of lawsuits. The court has so far rejected the company's petitions to hear Roundup lawsuits.