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A federal judge in Fort Worth, Texas, has approved a reorganization plan for Waco-based Life Partners Holdings Inc., which filed for bankruptcy protection in 2015 amid allegations that the company and founder Brian Pardo defrauded investors and put more than $1.4 billion in premiums at risk, the Waco Tribune reported today. The action means Pardo has no further involvement in the entity he created in 1991 to broker sales of life insurance policies from terminally ill patients to investors from around the world. Life Partners Holdings became a frequent target of the Securities and Exchange Commission, which most recently alleged the company purposefully underestimated the life expectancy of clients selling policies, making them more desirable to investors. The commission imposed an almost $47 million judgment. That case prompted the company’s bankruptcy filing and the involvement of trustee H. Thomas Moran II. Bankruptcy Judge Russell F. Nelms confirmed the reorganization plan on Tuesday after Moran spent months identifying 22,000 investors; holding town hall-style informational meeting in several cities, including Waco; and holding five weeks of hearings before Judge Nelms in a Fort Worth courtroom. The ruling preserves a portfolio of life insurance policies with a face value of $2.4 billion and provides a more certain future for $1.4 billion in premiums. Read more. 

Don’t miss next Tuesday’s free abiLIVE webinar “Administration of a Mega Ponzi Scheme Case: Receivership v. Bankruptcy.”

For a further analysis of commercial fraud, make sure to pick up a copy of ABI’s Fraud and Forensics: Piercing Through the Deception in a Commercial Fraud Case. 

Midstates Petroleum Inc.’s stock began trading yesterday on the New York Stock Exchange after the firm emerged from bankruptcy protection last week, Tulsa World reported today. The stock is being traded under the company’s previous ticker symbol, MPO. As with most bankruptcy reorganizations, Midstates’ previous common stock was canceled, and its $2 billion in debt was converted into equity in the newly organized company. The stock, which was delisted in February for falling below the exchange’s minimum-listing requirements, opened at $19 per share yesterday and closed at $22.65.

A plan to wind down the estate of former Silicon Valley startup Jumio Inc. won final approval from a bankruptcy judge, bringing the contentious chapter 11 case nearer to a close, the Wall Street Journal reported today. Following a hearing on Wednesday, Bankruptcy Judge Brendan Shannon said that he would sign off on the identity-verification company’s debt-payment plan, overruling opposition from its former chief executive as well as some shareholders. The ruling represents a victory for early Jumio backers, such as venture-capital firm Andreessen Horowitz and Facebook co-founder Eduardo Saverin, who fought allegations that they had worked to rig the bankruptcy to their advantage. At the center of the plan is a settlement reached earlier this year that was backed by Saverin and Andreessen, as well as a committee representing shareholders. When it takes effect, the plan will largely shield Saverin and Andreessen from future lawsuits tied to the bankruptcy, although some shareholders retain the right to sue Saverin and others. One shareholder lawsuit against Saverin is already pending.

Goodrich Petroleum Corp., one of the first mid-sized drillers to file for bankruptcy this year, has successfully completed its chapter 11 reorganization plan and has formally emerged from bankruptcy, FuelFix.com reported yesterday. The Houston-based drilling company was able to negotiate with its creditors to reduce its debts and costs and retain its assets. The company gets $40 million in new capital through second lien notes due in 2019. Half of that money will pay down outstanding debt and the other half will be used to fund the company’s drilling program in the Haynesville Shale, according to a company statement. Read more.

Get a better understanding of what happens when an oil, gas or other natural resources company goes bankrupt. Order your copy of ABI's revised and expanded When Gushers Go Dry: The Essentials of Oil & Gas Bankruptcy, Second Edition. 

Warren Resources Inc. said it's closing its Houston office after the company recently emerged from bankruptcy, the Houston Business Journal reported yesterday. At the time of its bankruptcy filing, the company had $229.7 million in total assets and $545.2 million in debt, according to court documents. A bankruptcy court on Sept. 14 confirmed the Denver-based company's plan of reorganization following a chapter 11 filing June 2, according to an Oct. 5 press release. Warren Resources also plans to shut down its office in Plano, Texas, and reduce leased space in other locations. But the company said that it will maintain a small team in Denver; Long Beach, Calif; Rollins and Casper, Wyo.; and Tunkhannock, Pa. Read more.

Get a better understanding of what happens when an oil, gas or other natural resources company goes bankrupt. Order your copy of ABI's revised and expanded When Gushers Go Dry: The Essentials of Oil & Gas Bankruptcy, Second Edition. 

Arch Coal says it has emerged from chapter 11 protection and its stock will trade again on the New York Stock Exchange today, the Associated Press reported. The company, which has been hurt by weakening demand for coal, filed for bankruptcy protection nearly eight months ago to reduce its debt. Several other coal companies have filed for bankruptcy protection recently as electric power companies opt to use natural gas instead of coal, because it is cheaper and produces less pollution than coal. Arch Coal says that it now has $363 million in debt and $300 million in cash. The company continued to operate while it was under bankruptcy protection.