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Lucky Bucks’ bankruptcy trustee has sued the new management of the slot machine operator, seeking to revoke the bankruptcy plan, WSJ Pro Bankruptcy reported. According to a lawsuit filed Tuesday, the trustee for the remnants of Lucky Bucks still in bankruptcy said that the people running the business during the bankruptcy failed to disclose alleged fraud that has led to a multimillion-dollar lawsuit by new owners that were also secured lenders in the business. Earlier this month, the reorganized Arc Gaming and Technologies sued several former Lucky Bucks employees under Georgia’s Racketeer Influenced and Corrupt Organizations Act, seeking the return of more than $200 million in “illegal dividends” and accusing the former managers of defrauding the company, leading to its bankruptcy. The silence about alleged misdeeds before and during the bankruptcy means that millions of dollars that could have gone to other creditors could now be out of reach in state court, according to the Tuesday lawsuit against Arc Gaming. The chapter 7 trustee for the remnants of Lucky Bucks said none of the allegations of “looting Lucky” were disclosed during the bankruptcy. That is despite members of Lucky Bucks’ board, managers and employees being aware of the alleged fraud, said chapter 7 trustee Marc Abrams.

A federal appeals court on Friday ruled that an independent examiner must be appointed to oversee FTX’s ongoing bankruptcy to sort out what went wrong at the cryptocurrency exchange before it collapsed, WSJ Pro Bankruptcy reported. Judges for the U.S. Court of Appeals for the Third Circuit said that the Bankruptcy Code clearly states that a bankruptcy court is required to appoint an independent examiner in cases with over $5 million in debt if one has been requested and no outside trustee has been brought in to manage the chapter 11 cases. The judges also said that it is a matter of public interest to have a report on what went wrong at FTX before it filed for bankruptcy in November 2022. “The collapse of FTX caused catastrophic losses for its worldwide investors but also raised implications for the evolving and volatile cryptocurrency industry,” the judges wrote in their opinion. “In addition to providing much-needed elucidation, the investigation and examiner’s report ensure that the Bankruptcy Court will have the opportunity to consider the greater public interest when approving the FTX Group’s reorganization plan.”

Kirkland & Ellis has been sued for allegedly profiting from an undisclosed romantic relationship between a Houston bankruptcy judge and a local bankruptcy lawyer, a relationship that ultimately caused the judge to resign, Reuters reported. Plaintiff Michael Van Deelen, whose October lawsuit led former U.S. Bankruptcy Judge David Jones to publicly acknowledge a romantic relationship with bankruptcy attorney Elizabeth Freeman, expanded his lawsuit Thursday to add Freeman, her former law firm Jackson Walker, and Kirkland & Ellis as defendants. Van Deelen alleged that Kirkland profited from Jones and Freeman's relationship by frequently teaming up with Jackson Walker, which served as local counsel, to represent debtors in Jones' court, knowing that Jones would give favorable treatment to the law firm that employed his girlfriend. Van Deelen said that Kirkland and the other defendants "deliberately concealed" the relationship in order to continue placing their cases in front of a friendly bankruptcy judge. Kirkland said Friday that Van Deelen's allegations against the firm were "baseless and false."

Cecelia G. Morris, the Southern District of New York bankruptcy judge who planned to retire at the end of January, will instead serve until the end of the year, Bloomberg Law reported. The Judicial Council of the Second Circuit approved Morris to remain on the bench from February to the end of 2024, according to a Wednesday order from Debra Ann Livingston, chief judge of the U.S. Court of Appeals for the Second Circuit.