Daily Archives: July 29, 2021

WASHINGTON, July 29, 2021 /PRNewswire/ -- More than 30,000 women cancer victims would retain their constitutional right to have juries decide if talc in Johnson & Johnson's (NYSE:JNJ) baby products caused their ovarian cancer under bankruptcy reforms proposed Wednesday by key lawmakers in the U.S. Senate and House of Representatives.

The Nondebtor Release Prohibition Act of 2021 would close controversial bankruptcy loopholes, including non-consensual third-party releases and the so-called "Texas Two-Step." Recent media reports indicate that Johnson & Johnson with a market cap of more than $400 billion is contemplating bankruptcy to avoid paying claims and damages that would likely cost a fraction of that amount. In a quarterly earnings report issued this week, J&J announced sales of $23.31 billion, a 27 percent increase year over year, and upgraded its annual sales forecast to $94.6 billion.

"Many of us are shocked that Johnson & Johnson would consider abusing the bankruptcy process to avoid caring for the women and families they've harmed," says Deane Berg, whose 2013 trial resulted in the first jury verdict establishing a link between talcum powder and ovarian cancer. "Before we were harmed by J&J, we were loyal J&J customers. They've turned their back on all of us."

Dozens of studies published in peer-reviewed journals during the past 25 years have shown a statistically significant association between talc use and ovarian cancer and mesothelioma. Documents produced at trial show that the company was aware of the dangers as far back as the 1960s.

The bankruptcy reform proposal introduced by Sen. Elizabeth Warren (D-Mass.), Sen. Richard Durbin (D-Ill.) and Sen. Richard Blumenthal (D-Conn.) in the Senate, and Rep. Jerrold Nadler (D-N.Y.) and Rep. Carolyn Maloney (D-N.Y.) in the House, would address a growing trend in which a profitable company is able to quickly corral legal liabilities and debts into a separate corporate entity. Known as a "divisive merger" or the "Texas Two-Step," the liability-laden subsidiary is then reincorporated elsewhere and eventually declared bankrupt. The threat of bankruptcy is used to intimidate individuals who file lawsuits and to drive down the value of negotiated settlements.

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"These conscientious and well-informed lawmakers recognize that allowing highly profitable companies to shirk their responsibilities to society is reprehensible and can't be tolerated," says Andy Birchfield, Mass Tort Section Head at the Beasley Allen Law Firm, which represents thousands of women diagnosed with ovarian cancer after exposure to Johnson & Johnson Baby Powder and other talc-based products. "The courts not the federal bankruptcy system are the proper forum for resolving disputes between wrongdoers and the people they injure."

The Nondebtor Release Prohibition Act would prohibit bankruptcy judges from allowing companies that are not a party to gain non-consensual releases of liability as part of the bankruptcy process. This tactic allows corporations to employ bankruptcy as a shield against liability. The legislation aligns with other proposed legislation dubbed the SACKLER Act introduced by Rep. Maloney.

In addition, bankruptcy filings often result in indefinite delays that freeze ongoing lawsuits in state and federal courts. Sen. Warren's bill would limit stays for a duration of only 90 days.

"These legislators should be applauded for recognizing the need to close the loopholes that allow powerful individuals and successful corporations to play blame-shifting with people's lives," says Michelle Parfitt, co-lead counsel in the federal talc MDL and a senior partner in the law firm Ashcraft & Gerel. "Whether it's a baby powder, a pharmaceutical or any other dangerous product, consumers need to be able to gain adequate compensation for any losses and injuries they've suffered. Without these proposals, that fundamental tenet of our justice system is at risk."

About the Beasley Allen Law FirmHeadquartered in Montgomery, Alabama, Beasley Allen is comprised of more than 70 attorneys and 200 support staff. One of the largest Plaintiffs law firms in the country, Beasley Allen is a national leader in civil litigation, with verdicts and settlements of more than $26 billion. For more information visit http://www.beasleyallen.com.

About the Ashcraft & Gerel Law Firm Washington, D.C.-based Ashcraft & Gerel, LLP was first developed in 1953. The goal of the law firm is to help those who have been injured while on the job. Since its founding, this law firm has become one of the largest and most well-known personal injury firms in the U.S.

Contact:Mark Annickmark@androvett.com800-559-4534

Cision

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SOURCE Beasley Allen Law Firm

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Women Cancer Victims Opposed to Johnson & Johnson's 'Texas Two-Step' Bankruptcy Ploy Urge Passage of Reforms Introduced by Warren, Durbin, Nadler,...

The Holiday Inn at 340 Biscayne Boulevard in Miami and attorney Linda Worton Jackson

The owner of a Holiday Inn in downtown Miami filed for Chapter 11 bankruptcy protection, with a plan aimed at luring investors to redevelop the site.

With its close proximity to PortMiami, Bayside Marketplace and the planned Waldorf Astoria Miami luxury tower, the hotel owners attorney Linda Worton Jackson said the 10-story building at 340 Biscayne Boulevard is attracting interest from potential investors. The property could be redeveloped as a mixed-use project with a hotel component.

The site is primed for development, Worton Jackson said. Its in a fabulous location with a lot of investors eyeing it with a view toward redevelopment.

The hotel is owned by the entity 340 Biscayne Owner LLC that is tied to Brazilian developer Gilberto Bomeny. The same company sold the land underneath the Holiday Inn to Kawa Capital Management in 2016 in a leaseback deal. The site consists of three contiguous parcels with a combined area of 39,982 square feet, which has been occupied since 1950 by a 200-room hotel currently under the management of Holiday Inn.

On Monday, the owner filed its petition in Miamis federal bankruptcy court, listing between $100 million to $500 million in assets, and liabilities between $10 million and $50 million. According to the list of the hotels 20 largest creditors, the main creditor is 340 Biscayne Lendco, which has a secured claim of about $37 million. First Bank of Puerto Rico has the largest unsecured claim for a PPP loan of $989,219.

Worton Jackson said her client expects to refinance the $37 million loan, keep post-petition debts and pay all creditors in full. By filing for Chapter 11 bankruptcy, the Holiday Inn owner will be able to restructure the existing loans and bring in new equity to improve operations, Worton Jackson said. Day-to-day operations will not be affected, she added.

The 200-room Holiday Inn relied heavily on cruise ship passengers sailing out of PortMiami, Worton Jackson said. They represented 70 percent of the hotels Thursday, Friday, Saturday and Sunday bookings, prior to the pandemic, according to a company press release. In 2019, more than one-third of the hotels reservations originated from contractual agreements related to the cruise industry.

The hotel, which also has 2,000 square feet of meeting space and onsite dining, operated regularly at 90-plus percent occupancy and had more than $10 million in annual operating revenue, the press release states. Business took a dive when its operations were limited due to emergency orders issued by local governments to curtail the spread of coronavirus. In April of last year, the Holiday Inn temporarily laid off 73 people, according to a WARN notice filed with the state.

During the pandemic, there were many days that the hotel operated in the single digits, Worton Jackson said. They kept it open for essential workers, including airline crews. Virtually all the employees [who were laid off] have been hired back.

According to the press release, the Holiday Inns occupancy picked up significantly in January to an average of 80 percent, and its first quarter performance exceeded hospitality industry forecasts. As a result, the Holiday Inn owner broke even on its hotel operations while remaining current on virtually all of its obligations. Once the cruise industry rebounds, the hotel expects to regain profitability, the press release states.

Rich Lilis, Collier Internationals executive managing director for hotels in the U.S., said the leisure segment is driving a resurgence in the hospitality sector. Lilis said occupancy in Miami-Dade was 72 percent in the second quarter, compared to 76 percent in the same period of 2019. But the average daily room rate improved by 26 percent, he said.

Investors are clamoring for Miami, Lilis said. I believe we will see a significant amount of transactions with new capital being invested into the Miami market.

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Bankruptcy could lead to redevelopment of downtown Miami Holiday Inn - The Real Deal

Official advisers to Washington Prime Group Inc. stockholders, skeptical of the Columbus-based company's proposed sale to SVPGlobal, are trying to slow down the mall landlord's bankruptcy.

A government-appointed group of Washington Prime stockholders has asked Judge Marvin Isgur to extend key deadlines in the insolvency proceedings by more than a month, arguing in court papers that the group's advisers don't have enough time to evaluate the real estate investment trust's Chapter 11 exit plan. Washington Prime may be worth more than the plan implies, but more time is needed to figure that out, the group says.

Washington Prime entered bankruptcy last month after the pandemic forced shoppers to stay home, crushing its tenants and sapping revenues. But rising vaccination rates and a resurgent U.S. economy have begun to reverse the company's fortunes, making it difficult to pin a value on its portfolio of roughly 100 shopping centers across the U.S. The company's website indicates it has nine malls in Ohio, including Great Lakes Mall in Mentor and Southern Park Mall in Youngstown.

The company plans to exit bankruptcy by handing ownership to investment firm SVPGlobal in exchange for debt forgiveness, assuming no better offers come in. But the plan's August approval deadline leaves relatively little time for competing bidders to make moves, and the company has said new offers must be all-cash and exceed $2.3 billion.

Critics say the timeline is especially cramped given the size and complexity of the company, while Washington Prime's lawyers have said its sale process is more than adequate. The stockholder group said its valuation consultant Newmark Valuation & Advisory needs more than the three weeks currently allotted to determine whether the sale to SVPGlobal is fair.

"With so much positive change in such a short period of time, it is very difficult today to discern the Debtors' worth, other than to say it is undoubtedly on the upswing," lawyers for the stockholders wrote in court papers. Through the proposed deal, "SVP seems to be 'buying' the Debtors' assets and business for a price that may not reflect true inherent value but is, rather, exploitative of momentary economic disruption."

Washington Prime and a representative for SVPGlobal declined to comment.

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Washington Prime investors seek to slow the mall owner's bankruptcy - Crain's Cleveland Business

As if partaking in the powerful drug it aggressively marketed, being at the forefront of the opioid boom was a dizzying high for Purdue Pharma. But it ultimately proved crippling for the manufacturer of OxyContin.

On Tuesday, the company revealed that its bankruptcy plan has received overwhelming support. The move will allow Purdueto settle thousands of lawsuits it faced over its role in helping trigger and fuelthe opioid crisis.

Among nearly 5,000 state and local creditors, 97% voted to accept the chapter 11 reorganization plan. A confirmation hearing is set for Aug. 9.

RELATED: OxyContin maker Purdue wins 15 states support in controversial $4B bankruptcy plan

This is an unprecedented expression of support for a restructuring of this size and complexity, in favor of a plan that will provide needed resources to those affected by the opioid crisis, Purdue Pharma CEO Steve Miller said in a release.

The vote came less than three weeks after 15 states signed off on Purdues controversial plan, which would transform the company into a nonprofit in exchange for excusing it from future litigation. Purdues owners, the Sackler family, would agree to settle for $4.5 billion to be paid over nine years, said the New York Times.

According to the House Committee on Oversight and Reform, which has been investigating Purdues role in the opioid crisis, the combined assets of the family are $11 billion. The committee estimated that opioid sales generated roughly $30 billion in revenue for Purdue.

RELATED: Purdue reaches $8B settlement on federal opioid chargesbut will it ever pay that amount?

There is considerable government pushback for the plan. On Monday, in Purdues home state of Connecticut, Sen. Richard Blumenthal (D) and attorney general William Tong voiced support for closing the loophole that allows large companies to declare bankruptcy to sidestep litigation. Tong will testify before a House Judiciary subcommittee on the issue this week.

Last week, Reuters reported that Johnson & Johnson is also considering a bankruptcy plan, which would entail establishing a new company in which to funnel lawsuits over its talcum products and then declaring it bankrupt.

Also last week, J&J and three distributors agreed to a landmark opioid settlement which resolved lawsuits for $26 billion.

Purdue has spent years in court battling opioid lawsuits. In October of 2020, it settled with the Justice Department for more than $8 billion to plead guilty and settle federal criminal and civil claims linked to its OxyContin actions.

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Purdue points to creditor support for bankruptcy plan to escape opioid litigation but will Congress follow - FiercePharma

The Insolvency and Bankruptcy Code (Amendment) Bill, 2021, which proposes a pre-packaged insolvency resolution mechanismfor micro, small and medium enterprises, was passed in the Lok Sabha on Wednesday.

The bill replaces the Insolvency and Bankruptcy Code (Amendment) Ordinance, 2021, which was promulgated on April 4, when Parliament was not in session, and amends the Insolvency and Bankruptcy Code, 2016.

Moneycontrol explains what the pre-packaged insolvency resolution process is,how it will be implemented, how it differs from the corporate insolvency resolution process (CIRP) and what its benefits are.

What is a pre-packaged insolvency resolution mechanism?

A pre-packaged insolvency resolution mechanism is an alternative method of providing a corporate rescue plan for MSMEs.

Under this framework, a debtor initiates and participates in the resolution proceedings with lenders through an informal process. Once the promoters of the company and the secured creditors agree on a resolution plan, they can approach the National Company Law Tribunal for approval.

How is the pre-packaged resolution initiated?

An MSME that has not met its payment obligation of10 lakh can initiate this scheme with approval from lenders that have advanced 66 percent of the debt amount.

What isthe corporate insolvency resolution process?

Under the existing CIRP model, an insolvent borrower is taken to bankruptcy court by the creditors for a timebound resolution and the process allows other entities to bid for the stressed entity.

How does the pre-packaged resolution process differ from CIRP?

Under CIRP, the promoter of a stressed unit cannot bid for it. A resolution professional is appointed to oversee the companys activities and the incumbent promoters have to step down. The resolution professional also manages the bidding and resolution process, for which there is a 270-day deadline.

Under the pre-packaged resolution model, the stressed borrower can prepare a resolution plan with the creditors, which could involve selling the company to an investor, before approaching the NCLT. The borrower retains management control of the company until a resolution is decided.

The time limit for the resolution has been drastically reduced to 120 days 90 days to submit a resolution plan and 30 days for the NCLT to approve or reject it. Promoters can also bid for their companies in the case of a buyout.

What are the benefits of the pre-packaged model?

For the NCLT, it will be a relief because the tribunal is burdened with several cases that can take several months. The tribunal will only have to reject or approve a resolution plan for MSMEs.

The promoters can continue to be in charge of their company until a settlement is reached and business activities can go on unhindered. The shorter time available for resolution will ensure that a companys assets are not eroded.

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Explained: All you need to know about the Insolvency and Bankruptcy Code (Amendment) Bill, 2021 - Moneycontrol.com