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Law firm White & Case LLP will stay in charge of a $14 billion bankruptcy lawsuit against Argentina’s YPF SA, a judge said, rejecting complaints that a lawyer’s career move had undermined the state oil giant’s defense, WSJ Pro Bankruptcy reported. The ruling said that YPF failed to show why White & Case should be ousted as counsel to the bankruptcy trust that has sued YPF in the litigation, which seeks to hold the Argentine oil company responsible for the costs of cleaning up New Jersey’s contaminated Passaic River. Judge Christopher Sontchi of the U.S. Bankruptcy Court in Wilmington, Del., issued the ruling Tuesday. Judge Sontchi said that White & Case had erected sufficient safeguards after hiring Jessica Lauria, a former top legal strategist to YPF, in October 2020. Ethical and law firm procedures will protect against disclosure of information that could be used against YPF, he found. Even though Ms. Lauria is no longer involved in the Passaic River litigation, YPF feared inadvertent disclosures of its confidential information.

The Justice Department’s bankruptcy watchdog is sounding the alarm over several recent “pre-packaged” chapter 11 cases that take only days, or even hours, from start to finish, Bloomberg Law reported. Some recent bankruptcies in particular have wrapped up very quickly. Retailer Belk Inc.'s 16-hour case in February set a record, while shale oil driller HighPoint Resources Corp.'s case concluded in March within four days of filing. These rapid-fire cases, which ostensibly are supposed to be reserved for extraordinary circumstances, are renewing concerns about fairness to creditors and transparency in the bankruptcy process. “Pre-packaged plans offer a means of expediting the bankruptcy process by doing most of the work in advance of the filing,” the U.S. Trustee said in a filing in HighPoint’s case, citing an appeals court decision. “That efficiency however, must not be obtained at the price of diminishing the integrity of the process.” Yet the U.S. could fall behind other countries if it doesn’t pick up the pace and lower the cost of chapter 11 proceedings. The DOJ’s U.S. Trustee’s Office says these ultra-rapid plan confirmations lack adequate notice to creditors and can block stakeholders from having any meaningful input. According to the UST, federal bankruptcy rules require at least 28 days’ notice before a court can approve a disclosure statement, the document that details a company’s chapter 11 plan. To get around this rule, the debtor must show “irreparable and immediate harm” to the bankruptcy estate if the court doesn’t confirm the plan sooner, the UST says. Belk’s “breakneck schedule precludes parties from meaningfully inquiring into the terms of the Plan, from examining the Debtors using the ordinary discovery tools available in contested matters, and from objecting to the Plan in a considered way,” the UST said in a court filing in the retailer’s chapter 11 case.

The National Rifle Association rolled the dice by filing for chapter 11 protection earlier this year, gambling that it could use the power of U.S. bankruptcy law to consolidate litigation and combat allegations of fraud and mismanagement brought by the New York attorney general, WSJ Pro Bankruptcy reported. The gun-rights group is about to find out how well that bet is playing out. A federal bankruptcy judge in Dallas has scheduled six days of virtual hearings starting today that are likely to determine the course of the bankruptcy and, potentially, of the NRA itself. Among those whose fates are on the line is Wayne LaPierre, the chief executive who has led the not-for-profit group for three decades and become the public face of one of America’s most powerful advocacy organizations. LaPierre and other top NRA officials are poised to testify in public for the first time on allegations of spending abuses at the group. New York’s attorney general is expected to call other witnesses, possibly including LaPierre’s longtime travel consultant, who arranged NRA-funded private jet flights for him and his relatives, and sat for a deposition last week. “The legal issues here have nothing to do with the Second Amendment — the NRA could be selling shoes,” Adam Levitin, a bankruptcy-law professor at Georgetown University, noted. “This is about whether a major charitable organization has been looted by its managers.” There are four possible outcomes to the hearings, bankruptcy specialists said. U.S. Bankruptcy Judge Harlin Hale could simply allow the NRA bankruptcy to continue rolling along. He could dismiss the case altogether. Or he could leave it in place, but appoint either an independent trustee or an examiner to probe the fraud allegations.