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/raid1/www/Hosts/bankrupt/TCR_Public/241121.mbx T R O U B L E D C O M P A N Y R E P O R T E R Thursday, November 21, 2024, Vol. 28, No. 325 Headlines 2070 RESTAURANT: Court Approves Savanna-Rae Settlement Agreement AFRITEX VENTURES: Fine Food Case Remanded to Florida State Court ALTA MESA: Investors Reach Over $11MM Class Suit Settlements BELMONT TRADING: To Sell Business Assets to Kassel Financing CAPROCK MILLING: Perdue Loses Bid to Dismiss Adversary Proceeding CAREMAX INC: Gets Green Light for BlackRock-Backed DIP Loan CD&R VIALTO: S&P Downgrades ICR to 'CC' on Announced Restructuring COMPLETE BEVERAGE: Gets OK to Use Cash Collateral Until Dec. 18 COST LESS DISTRIBUTING: Gets Interim OK to Use Cash Collateral DEL FUEGO: To Sell Restaurant to Michael Krychowecky for $850,000 EARTH HOUSE: No Change in Patient Care, 3rd PCO Report Says EBURY STREET: Court Grants Emigrant's Motion to Remand Case EMERGE ENERGY: Superior Silica's Summary Judgment Bids Nixed EMPACADORA Y PROCESADORA: Insurer Wins Summary Judgment Bid FIDDLERS GREEN: Files Chapter 11 Bankruptcy in Texas FIREPAK INC: Seeks Chapter 11 Bankruptcy Protection FIRSTENERGY NUCLEAR: 3rd Circuit Affirms Dismissal of Daman Suit FREE SPEECH: Alex Jones Sues The Onion, Parents on Infowars Bid FREE SPEECH: FUAC Wants to Disqualify The Onion's Winning Bid GREATER LIBERTY: To Sell Bronx Property to Christ International GUARDIAN ELDER: PCO Submits First Report HIGHLAND CAPITAL: Dondero, et al.'s Bid for Mandamus Relief Fails IIG GLOBAL: Court Narrows Claims in Fraud Lawsuit IKECHUKWU H. OKORIE: Loses Bid to Reopen Bankruptcy Case INTRUM SA: Judge Sets Schedule for Ch. 11 Case Dismissal Hearing JBRI CONSTRUCTION: Kicks Off Chapter 11 Bankruptcy Process K&L TRAILER: GFB Wins Summary Judgment Bid in FF&CB Case LA MONARCA: Sec. 341(a) Meeting of Creditors on Dec. 6 M. BURTON MARSHALL: Court Tosses O'Dell v. Berkshire Bank Lawsuit MARTINEZ PALLET: Gets OK to Use Cash Collateral Thru. Dec 31 MAXIMUS SUPPLY: Gets Interim OK to Use Cash Collateral Thru Jan. 16 MEDICAL PROPERTIES: Aims to Take Over 3 California Entities MMA LAW FIRM: Morris Bart Not Entitled to Jury Trial, Court Rules MOJ REALTY: Court OKs Mobile Home Park Sale for $1.6MM MURRAY ENERGY: Malpractice Claim v. Dinsmore & Shohl, et al. Tossed ONYX SITE: Court OKs Barber Greene Property Sale PLAY DAY: Gets Interim OK to Use Cash Collateral Thru Jan. 31 PROVISION BREAD: Court Approves to Use Cash Collateral for Retainer ROCKVILLE CENTRE DIOCESE: Court OKs $88MM Insurance Deal SEELOS THERAPEUTICS: Seeks Chapter 11 After Nasdaq Delisting SEYED MUSTAFA MAGHLOUBI: Court Orders Coercive Incarceration SHERATON CRESCENT: Faces Uncertainty After Failing to Secure Buyer SHERMAN/GRAYSON: PCO Reports No Change in Patient Care Quality SKYLOCK INDUSTRIES: Seeks to Sell Machine, Equipment in Auction SMITH HEALTH CARE: Seeks Bankruptcy Protection in Pennsylvania SOLDIER OPERATING: Affiliate Seeks to Sell Movable Equipment SPACE SHADOW: Seeks to Sell Henderson Property for $6.1MM STEWARD HEALTH: PCO Files Emergent Supplemental Report SWITCHBACK COFFEE: Court Allows to Use Cash Collateral UNIGEL GROUP: Asks NY Court to Recognize Foreign Proceedings VERTEX ENERGY: Court Approves Chapter 11 Plan Disclosures VROOM INC: 98% Convertible Noteholders Support Restructuring Plan WASHINGTON BOI: Court Approves Use of Cash Collateral WELLPATH HOLDINGS: Court OKs December Auction for Division WELLPATH HOLDINGS: Court Stays Vaughn Lawsuit Due to Bankruptcy WOM SA: Receives Revised Takeover Proposal From Stalking Horse ********* 2070 RESTAURANT: Court Approves Savanna-Rae Settlement Agreement ---------------------------------------------------------------- The Honorable James L. Garrity, Jr. of the United States Bankruptcy Court for the Southern District of New York granted the application of Albert Togut, Esq., chapter 7 trustee of 2070 Restaurant Group, LLC and Genesis Foods LLC's estates, for an order pursuant to section 105 of title 11 of the United States Code and Federal Rule of Bankruptcy Procedure 9019 approving a stipulation settling claims against Savanna-Rae, LLC and Ray Hill. On July 30, 2018, 2070 Restaurant and Genesis Foods LLC each filed a voluntary petition for relief under chapter 11 of the Bankruptcy Code. Thereafter, the Court entered an order authorizing the joint administration and procedural consolidation of the Chapter 11 Cases pursuant to Bankruptcy Rule 1015(b). On September 6, 2018, 2070 Restaurant commenced an adversary proceeding by filing a complaint against Savanna-Rae LLC and its managing member, Ray Hill. The Complaint alleged various causes of action related to a management agreement and sale agreement between 2070 Restaurant and the Defendants regarding a restaurant business. On January 23, 2020, the Court entered an order converting the Chapter 11 Cases to cases under chapter 7 of the Bankruptcy Code. On January 24, 2020, Albert Togut was appointed as the interim trustee of the Debtors by the United States Trustee; he duly qualified and is acting as chapter 7 trustee herein. Following his appointment, the Trustee assumed control over the Adversary Proceeding and engaged in settlement negotiations with the Defendants and Abyssinian Development Corporation, as Sole Member of ADC/ Ennis Francis II Housing Development Fund Company, Inc. to resolve the Complaint and other claims by and among the Settlement Parties. The Settlement Parties ultimately reached a stipulated settlement agreement that resolved all claims. As relevant, pursuant to the settlement, the Trustee agreed to dismiss the Adversary Proceeding and the Defendants agreed to make certain payments to the Trustee totaling $100,000, as follows: a. Release of escrow funds totaling $60,000 held by the Defendants' counsel to the Trustee; b. A payment of $10,000 to the Trustee within ten days after the effective date of the Global Settlement; and c. Six monthly payments of $5,000 to the Trustee beginning on the first business day of the month that is sixty days after the effective date of the Global Settlement and then on the first business day of the month that is 60 days after the date that the prior Monthly Payment is due. On March 18, 2021, the Court entered an order approving the Global Settlement and on April 20, 2021, the Court closed the Adversary Proceeding. Thereafter, the Trustee recovered the $60,000 Escrow Payment and the Defendants made the Initial Payment. However, the Defendants failed to pay $22,500 of the $30,000 total Monthly Payments, leaving such amounts unpaid and outstanding Amount in full. The Trustee has determined that further efforts to collect the Remaining Amount from the Defendants would not be an efficient use of the Estates' resources and would not be beneficial to the Estates. To resolve the Trustee's claim to the Remaining Amount, the Defendants and the Trustee have negotiated and executed a stipulation, subject to approval by the Court. Without limitation, the Settlement Agreement provides, as follows: a. The Defendants shall make a single payment of $5,600 to the Trustee in full and final satisfaction of the Remaining Amount. b. The Settlement Payment shall be made not later than 15 days following the date that the Settlement Agreement is "so ordered" by the Court either by check made payable to "Albert Togut, as Chapter 7 Trustee of 2070 Restaurant Group" or by wire instructions to be provided by the Trustee to the Defendants. c. Upon receipt of the Settlement Payment by the Trustee, the parties will provide releases to each other. d. In the event that the Defendants fail to timely pay the Settlement Payment, or any Settlement Payment is dishonored by the Trustee's bank, counsel for the Trustee will send a written default notice by electronic and first-class mail to the Defendants. If the Defendants fail to cure such default within ten (10) days after the notice is sent, the Trustee may seek to enforce the Judgment in full. e. Following the Completion Date, the Trustee will file a satisfaction of judgment in the Debtors' cases, and a copy of it will be provided to the Defendants. In support of the Application, the Trustee submits that the Settlement Agreement represents a prudent exercise of his considered business judgment and is the product of arm's length negotiations between the Trustee and Defendants. He asserts that the Settlement Agreement benefits the Estates by: (i) resolving the dispute over the Remaining Amount in a cost-effective and efficient manner, (ii) providing valuable consideration to the Estates, including "an immediate and certain recovery of $5,600," and a waiver of any and all of the Defendants' potential claims against the Trustee and Estates, (iii) eliminating "material risks" associated with additional recovery attempts, such as costs, uncertainties, and delays, and (iv) enabling the Trustee to conclude his administration of the Estates. The Trustee maintains that the cost, expense, and delay associated with further negotiations with the Defendants or attempts to collect the Remaining Amount are not warranted because the Defendants have demonstrated their inability to pay that amount. He has determined that seeking additional recovery of the Remaining Amount from the Defendants would not be beneficial to the Estates. The Trustee asserts that the settlement terms are fair, reasonable, and equitable, and fall well above the lowest point in the range of reasonable potential litigation outcomes. He contends that the Settlement Agreement is in the best interests of the Estates, and asks the Court to approve the Settlement Agreement. The Court finds that the Settlement Agreement is fair, equitable, and in the best interests of the Estates. It provides for monetary recovery to the Estates and resolution of the Adversary Proceeding. It will expedite the administration of the Estates, and the closing of these cases. The Court approves the Settlement Agreement pursuant to Bankruptcy Rule 9019(a). A copy of the Court's decision is available at https://urlcurt.com/u?l=vghTWu Counsel to the Chapter 7 Trustee, Albert Togut: Neil Berger, Esq. Togut, Segal & Segal LLP One Penn Plaza, Suite 3335 New York, NY 10119 E-mail: neilberger@teamtogut.com Counsel to Savanna- Rae, LLC and Ray Hill: Daniel Schneider, Esq. Offit Kurman, P.A. 590 Madison Avenue, 6th Floor New York, NY 10022 E-mail: daniel.schneider@offitkurman.com About 2070 Restaurant Group 2070 Restaurant Group LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. N.Y. Case No. 18-12323) on July 30, 2018. At the time of the filing, the Debtor estimated assets of less than $50,000 and liabilities of less than $500,000. The case has been assigned to Judge James L. Garrity Jr. Bruce J. Duke, LLC was the Debtor's legal counsel. On January 23, 2020, the case was converted to Chapter 7. Albert Togut is the Chapter 7 trustee. AFRITEX VENTURES: Fine Food Case Remanded to Florida State Court ---------------------------------------------------------------- Judge David S. Leibowitz of the United States District Court for the Southern District of Florida granted in part and denied in part Fine Food Factory, Inc.'s motion to remand the case captioned as FINE FOOD FACTORY, INC., Plaintiff, v. FACILITRACE LLC, et al., Defendants, CASE NO. 0:24-cv-61191 (S.D. Fla.) to Florida state court and for award of attorneys' fees and costs. Plaintiff's request to remand the case is granted. The case is remanded to the Circuit Court of the Seventeenth Judicial Circuit in and for Broward County, Florida. Plaintiff's request for attorneys' fees and costs is denied. In this breach of contract action, Plaintiff Fine Food Factory, Inc., is a distributor of food products. Defendant Afritex Ventures, Inc., supplies seafood products to retailers. Defendant Banigan is the controlling shareholder of Afritex. Defendants Diamond, Van Der Burgh, and Fineberg are officers of Afritex. Defendant Facilitrace, LLC, is solely owned and operated by Banigan. In November 2022, Facilitrace contracted to purchase $7 million of crab from Plaintiff for Afritex's benefit so that Afritex could sell the crab to Kroger grocery stores. Plaintiff alleges that Facilitrace and Afritex breached this contract when Facilitrace ultimately refused to pay for or take delivery of the crab on behalf of Afritex. The Complaint also contains numerous common law and statutory claims based on the relationships among Facilitrace, Afritex, and Afritex's officers. Plaintiff theorizes that Facilitrace is the alter ego of Banigan and Afritex -- Plaintiff alleges that Facilitrace was "formed solely for the improper purpose of evading the contractual and financial obligations" of Afritex. Accordingly, Plaintiff argues that the individual Defendants and Afritex are liable for any contract obligations and liabilities incurred by Facilitrace. Plaintiff initially filed suit against Defendants in the Circuit Court of the Seventeenth Judicial Circuit in and for Broward County, Florida, in February 2024. In April 2024, Plaintiff filed the operative, Second Amended Complaint, which is comprised entirely of state law claims. On July 12, 2024, Defendants Van Der Burgh, Afritex, and Banigan filed a Motion to Transfer Venue of this action to the bankruptcy court in Texas. Plaintiff's Motion for Remand In response to Defendants' removal and request to transfer, Plaintiff filed the instant Motion on July 16, 2024. In the Motion, Plaintiff makes three arguments: (1) the Southern District of Florida should remand this action pursuant to 28 U.S.C. Sec. 1334(b), because this case is not related to the bankruptcy proceedings; (2) even if this action is related to the bankruptcy proceedings, the the Southern District of Florida must remand the case under 28 U.S.C. Sec. 1334(c)(2), because it does not have an independent basis for jurisdiction, the claims involved do not arise under Title 11 of the Bankruptcy Code, and this case was commenced and could be timely adjudicated in state court; and (3) the Southern District of Florida should exercise its discretion under 28 U.S.C. Sec. 1334(c)(1), and remand this action in the interest of justice. Additionally, Plaintiff argues that the Southern District of Florida should award it attorneys' fees because Defendants filed the bankruptcy petition as a thinly veiled attempt to forum shop for a more convenient location for the Texas Defendants. Defendants respond that this action is related to the bankruptcy proceedings because "if Plaintiff were to be successful, Plaintiff's claims would clearly affect Facilitrace because Plaintiff is seeking a debt directly from Facilitrace's bankruptcy estate and Defendant Afritex is also a creditor in the estate, along with the other defendants who have claims because of Plaintiff's lawsuit." Defendants further argue that this case is a "core proceeding" which preempts mandatory remand under 28 U.S.C. Sec. 1334(c)(2). Moreover, Defendants argue that a fee award is unwarranted because removal to the Southern District of Florida was proper. Accordingly, most bankruptcy courts, rather than summarily dismiss an ancillary action, instead weigh several factors when deciding whether to retain jurisdiction. These factors include: "(1) judicial economy; (2) fairness and convenience to the litigants; and (3) the degree of difficulty of the related legal issues involved." Typically, these factors support remand where: (1) the bankruptcy proceedings have been dismissed, (2) discovery has not commenced in federal court, and (3) the plaintiff seeks a jury trial on its claims. In this case, the balance of the In re Morris factors support remand, the Southern District of Florida finds. Judge Leibowitz explains, the Facilitrace bankruptcy proceedings have been dismissed. The contract at issue in this case was executed in Florida, the relevant conduct occurred in Florida, and, accordingly, discovery is inextricably tied to Florida. Defendants chose to do business in Florida, and Plaintiff specifically chose to bring this action in Florida, a decision which 'should not be disturbed unless it is clearly outweighed by other considerations.' While not conceptually difficult, the claims in this action are based entirely on state law, and Florida courts are in the best position to decide such issues. Finally, Plaintiff maintains that it will not waive the right to a jury trial in this dispute. Together, these facts weigh in favor of remanding this action to the state court. Plaintiff's Request for Attorneys' Fees and Costs Plaintiff argues in its Motion that the Southern District of Florida should award Plaintiff its attorneys' fees and costs associated with prosecuting this motion to remand. In the instant case, Plaintiff argues that Defendants conspired to prolong this litigation by purposefully declaring bankruptcy of an assetless corporation to "manufacture" federal jurisdiction and thereby "forum shop" to a more convenient forum. Defendants respond that Plaintiff has offered no justification that would support an exercise of the Court's discretion to award fees in this case. Accordingly, Plaintiff's request for fees should be denied. Plaintiff has not presented sufficient evidence that Defendants have abused their right to removal, and therefore Plaintiff's request for attorneys' fees and costs is denied, the Southern District of Florida concludes. A copy of the Court's decision is available at https://urlcurt.com/u?l=xxcxU1 About Afritex Ventures, Inc. Afritex Ventures is a diversified investment holding company specializing in the seafood industry. Headquartered in Dallas, the Company develops and markets premium seafood products under multiple brands. Afritex Ventures, Inc. filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Tex. Case No. 24-43390) on September 22, 2024, listing $1 million to $10 million in assets and $1 million to $50 million in liabilities. The petition was signed by David J. Diamond as director. Judge Edward L Morris presides over the case. Vickie L. Driver, Esq. at CROWE & DUNLEVY, P.C. represents the Debtor as counsel. ALTA MESA: Investors Reach Over $11MM Class Suit Settlements ------------------------------------------------------------ Martina Barash of Bloomberg Law reports that Alta Mesa Resources Inc. investors have secured class action settlements exceeding $11 million with multiple defendants as a trial begins over the blank-check merger that led to the now-defunct energy company going public. On November 15, investors filed for preliminary court approval of a $2 million settlement with private equity firm Bayou City Energy Management LLC, the latest in a series of settlement motions in the U.S. District Court for the Southern District of Texas, the report states. The remaining major defendants, HPS Investment Partners LLC and ARM Energy Holdings LLC, have also sought approval for settlements totaling $6.3 million. About Alta Mesa Resources Alta Mesa Resources, Inc., is an independent energy company focused on the development and acquisition of unconventional oil and natural gas reserves in the Anadarko Basin in Oklahoma, and through Kingfisher Midstream, LLC, provides best-in-class midstream energy services, including crude oil and gas gathering, processing and marketing and produced water disposal to producers in the STACK play. Alta Mesa reported $1.4 billion in assets and $864 million in liabilities as of Dec. 31, 2018. On Sept. 11, 2019, Alta Mesa Resources, Inc. and six affiliated debtors each filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas. On January 12 and 13, 2020, Kingfisher Midstream, LLC, Kingfisher STACK Oil Pipeline, LLC, Oklahoma Produced Water Solutions, LLC, and Cimarron Express Pipeline, LLC -- Kingfisher Debtors -- and SRII Opco, LP and SRII Opco GP, LLC -- SRII Debtors -- filed voluntary petitions for relief in the Court. All the cases are jointly administered under Case No. 4:19-bk-35133 (Bankr. S.D. Texas) before Judge Martin Isgur. The Debtors tapped Porter Hedges LLP and Latham & Watkins LLP as attorneys; and Perella Weinberg Partners LP and its affiliate Tudor Pickering Holt & Co Advisors LP as investment banker. Prime Clerk LLC, n/k/a Kroll, was the claims agent. On April 17, 2020, the Alta Mesa Debtors filed their Plan of Reorganization and the Disclosure Statement related thereto. On April 22, 2020, the Bankruptcy Court entered an order conditionally approving the Alta Mesa Disclosure Statement. The Bankruptcy Court held a hearing to consider final approval of the adequacy of the Alta Mesa Disclosure Statement and confirmation of the Plan on May 27, 2020. On June 8, 2020, the Effective Date of the Plan occurred, and the Plan was consummated. On April 22, 2020, the Kingfisher Debtors filed their Amended Joint Chapter Plan and the Disclosure Statement related thereto. The Bankruptcy Court held a combined hearing to consider approval of the Kingfisher Disclosure Statement and confirmation of the Plan on May 27, 2020. On June 8, 2020, the Effective Date of the Plan occurred, and the Plan was consummated. On September 26, 2021, the Court entered a Final Decree closing the Kingfisher Debtors' chapter 11 cases. BELMONT TRADING: To Sell Business Assets to Kassel Financing ------------------------------------------------------------ Belmont Trading Co., Inc., seeks permission from the U.S. Bankruptcy Court for the Northern District of Illinois, Eastern Division, to sell its property, free and clear of liens to Kassel Financing LLC. The Debtor proposes a December 17, 2024 9:30 a.m, sale hearing. The Debtor aims to sell all of its assets, except its cash and accounts receivable, to its secured lender Kassel Financing, LLC. The Debtor's assets are encumbered by a first priority UCC lien now held by Kassel asserting a secured claim of $2,575,754.00, plus applicable interest and attorneys' fees based upon asset values in the Debtor's Schedules, and a total claim of $3,474,252.62. Kassel has offered to purchase all of the Debtor's assets including prepetition causes of action as described in section 7.13 of the Debtor's Plan for $200,000 cash plus a credit bid for an amount to be determined up to Kassel's secured debt. Any other bidder will be required to bid at least $400,000 in cash plus such minimum additional sum as is provided in the bid procedures. Anything herein or in the Disclosure Statement, Plan, or other paper filed by the Debtor in the case notwithstanding, nothing in the Debtor's Filings will reduce and/or discharge any of the Kassel Secured Claim, unless and except to the extent that Kassel bids cash (including payments over time) and/or credit bids some portion or all of the Kassel Secured Claim to acquire the Debtor's assets at the "Section 363 Sale, or release any guarantor or third-party collateral by reason of such sale." If the Kassel bid of $400,000 is the winning bid, Kassel's total claim against the Debtor will be reduced by $400,000 and only $400,000, Kassel's lien against the purchased assets will be released, but the obligations of any and all guarantors of the Debtor's indebtedness to Kassel will remain as guarantors to the full extent of their now existing guarantees, and all collateral posted by the guarantor(s) to Kassel will continue to secure and to stand as collateral against the indebtedness to Kassel pursuant to any and all agreement(s) with Kassel and pursuant to all the loan documents evidencing, guaranteeing, and securing it. About Belmont Trading Co. Inc. Belmont Trading Co., Inc., offers full-service value recovery and recycling services for mobile devices. Belmont Trading processes retired mobile devices and remarket and resell them. Belmont Trading sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ill. Case No. 23-12083) on Sept. 12, 2023. In the petition signed by Igor Boguslavsky, president, the Debtor disclosed $2,575,764 in assets and $15,773,104 in liabilities. Judge Janet S. Baer oversees the case. O. Allan Fridman, Esq., at Law Office of Allan Fridman, is the Debtor's legal counsel. CAPROCK MILLING: Perdue Loses Bid to Dismiss Adversary Proceeding ----------------------------------------------------------------- Judge Matthew J. Kacsmaryk of the United States District Court for the Northern District of Texas ruled on the motions filed by Perdue Agribusiness LLC in the case captioned as CAPROCK MILLING & CRUSHING, LLC, Plaintiff, v. PERDUE AGRIBUSINESS LLC, Defendant, Civil (C.V.): 2:24-CV-038-Z (N.D. Tex.). Before the Court is Defendant's Motion to Dismiss the Complaint for Lack of Personal Jurisdiction, Motion to Transfer the Adversary Proceeding and Motion to Abstain, all filed February 20, 2024. Having reviewed the Motions, briefing, and relevant law, the Court denies the Motion to Dismiss, grants the Motion to Transfer, and denies as moot the Motion to Abstain. CapRock Milling & Crushing filed a Chapter 11 bankruptcy petition on November 3, 2023. Following proceedings in that petition, CapRock filed an Adversary Proceeding on January 18, 2024, against Perdue Agribusiness seeking damages for a breach of a prepetition contract. The Adversary Proceeding is rooted in a July 2021 contract wherein Perdue hired CapRock to "perform milling and crushing services for Perdue's organic soybeans." CapRock avers Perdue ceased making its invoice payments which forced CapRock into bankruptcy. CapRock's only claim against Perdue is a breach of contract claim arising from the Toll Processing Agreement between CapRock and Perdue. CapRock admits the Toll Processing Agreement is a "valid, enforceable contract between CapRock Milling and Perdue." Perdue moved to withdraw the reference of the Adversary Proceeding. Perdue also sought dismissal of the Adversary Proceeding and if denied, transfer of the case to the District of Maryland. According to the Court, the Adversary Proceeding is related to Cap Rock's pending title 11 bankruptcy. It concerns pending invoices that, if recovered, would infuse CapRock with substantial funds and aid in the administration of the bankruptcy estate. Thus, federal subject matter jurisdiction is met under 28 U.S.C. Section 1334(b), the Court finds. Because the Court has federal subject matter jurisdiction over the Adversary Proceeding, personal jurisdiction can be assessed examining federal contacts, not state contacts. Judge Kacsmaryk says Perdue has more than sufficient contacts with the United States to be subject to personal jurisdiction here. Perdue is a Maryland company. Residing in the United States is sufficient to exercise personal jurisdiction over Perdue in a matter related to a proceeding under title 11. Under the Bankruptcy Rules, the Court has personal jurisdiction over Perdue. Accordingly, Perdue's Motion to Dismiss is denied. In noncore proceedings, forum selection clauses are presumptively enforceable unless "unreasonable under the circumstances." CapRock argues it will be deprived of its day in court if the Adversary Proceeding is transferred to Maryland per the Toll Processing Agreement. It claims that significant expense, inconvenience, and unfairness present hurdles to litigating its claim in Maryland. The Court finds the forum selection clause is not unreasonable because it will not deprive CapRock of its day in court. CapRock may incur costs and expenses because of the need for Maryland counsel in addition to the inefficiencies of supervising and managing litigation in a different forum. But all these considerations were present at the time CapRock signed the agreement and were ones it should have considered, the Court notes. The forum selection clause is not unreasonable for this reason because CapRock itself did not find it unreasonable, the Court states. The Court points out the forum selection clause is enforceable, and the Adversary Proceeding is noncore, so 28 U.S.C. Section 1404(a) governs transfer. Section 1404(a) permits transfer for the convenience of parties and witnesses, in the interest of justice to a district or division "to which all part,es have consented." Courts typically apply a variety of private and public interest factors to make this assessment but when a valid forum selection clause exists, only public interest factors bear weight. The remaining public interest factors under Section 1404(a) include "(1) the administrative difficulties flowing from court congestion; (2) the local interest in having localized interests decided at home; (3) the familiarity of the forum with the law that will govern the case; and (4) the avoidance of unnecessary problems of conflicts of laws or in the application of foreign law." CapRock recites the public interest factors but offers little argument on whether they weigh in its favor. Instead, as discussed, CapRock centered its public policy discussion on arguing the forum selection clause was unreasonable because of the policy of centralizing bankruptcy proceedings together. None of the factors weigh heavily enough in CapRock's favor to create the "unusual case" where a forum selection clause is not enforceable under Section 1404(a), the Court concludes. A copy of the Court's decision is available at https://urlcurt.com/u?l=uT11qc About Caprock Milling & Crushing CapRock Milling & Crushing, LLC is engaged in grain and oilseed milling based in Amarillo, Texas. Caprock filed Chapter 11 petition (Bankr. N.D. Texas Case No. 23-20251) on Nov. 3, 2023, with $10 million to $50 million in assets and $1 million to $10 million in liabilities. Thomas Bunkley, member of Caprock, signed the petition. Judge Robert L. Jones oversees the case. The Debtor tapped Mullin Hoard & Brown, LLP as bankruptcy counsel; Charhon Callahan Robson & Garza, PLLC as special counsel; and William Hood & Company as investment banker. CAREMAX INC: Gets Green Light for BlackRock-Backed DIP Loan ----------------------------------------------------------- Dorothy Ma of Bloomberg Law reports that a U.S. bankruptcy court judge has granted interim approval for CareMax Inc., a Florida-based medical center operator, to obtain debtor-in-possession (DIP) financing. The $122 million loan, provided by existing lenders BlackRock and Crestline Management, includes $30.5 million in new funding and $91.5 million in roll-up debt, according to company attorney Anthony Grossi during a hearing on Tuesday, November 19, 2024, the report relates. According to Bloomberg Law, CareMax is negotiating with a potential stalking horse bidder for its clinical center business, with plans to finalize the sale by the end of January. If the sale fails, the DIP lenders are prepared to submit a credit bid for the assets. About CareMax Inc. CareMax Inc. is a provider of medical centers for elderly patients. CareMax Inc. sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Tex. Case No. 24-80093) on November 17, 2024. In its petition, the Debtor reports estimated liabilities between $500 million and $1 billion and estimated assets between $100 million and $500 million. The Debtor is represented by Thomas Robert Califano of Sidley Austin LLP. CD&R VIALTO: S&P Downgrades ICR to 'CC' on Announced Restructuring ------------------------------------------------------------------ S&P Global Ratings lowered all its ratings on New York-based provider of global mobility solutions CD&R Vialto UK Intermediate 3 Ltd. (Vialto), including the issuer credit rating and the issue-level rating on its first-lien term loan to 'CC' from 'CCC-' and placed the ratings on CreditWatch with negative implications. S&P said, "The negative CreditWatch placement reflects our expectation that the ratings will be lowered to 'SD' or 'D' once the company completes is proposed restructuring. "We would view the proposed restructuring as a default. The company is expecting to reduce its funded debt by $550 million as it eliminates $150 million of first-lien term loans and the entirety of its $400 million second-lien term loan. We view the transaction as offering lenders less than the original promise because some first-lien debt and all second-lien debt will be converted to equity. Meanwhile, the remaining first-lien debt maturity will be extended and the PIK option will allow for deferred cash interest payments. We believe the 25 basis points (bps) increase in cash interest rate, minimum liquidity covenant, and other favorable amendments do not constitute adequate compensation for first-lien lenders." The transaction will improve the company's liquidity profile with bridge financing, providing immediate cash relief. Vialto's equity sponsors are contributing $225 million of cash in the form of a bridge loan that will be converted to equity once the contemplated transaction is complete (expected early 2025). This provides Vialto with liquidity in the interim, allowing it to fund transaction fees and avoid a shortfall. S&P expects the additional liquidity and reduced debt burden will help the company's turnaround efforts and will be a primary consideration for our ratings following the restructuring. Vialto's financial hardships follow a series of execution missteps since its carveout from PwC. Vialto has faced numerous impediments through its separation from PwC. In S&P's view, an initial failure to recognize the complexity of the separation process and to anticipate the needs of the stand-alone business led to mounting operational challenges that the company has been unable to overcome under its existing capital structure. Some of its missteps included initially underestimating the cost structure of the stand-alone organization, not anticipating certain expenses associated with the separation, facing working capital challenges related to billing and collecting its receivables, and absorbing cost overruns related to building out its infrastructure. Despite a seemingly compelling value proposition, the complexity of operating the business on a large scale with a physical footprint throughout the globe has proven to be overly burdensome. S&P thinks some of these challenges ultimately led to its leadership transition in April 2024. S&P said, "The negative CreditWatch placement reflects our expectation that the issuer credit rating will be lowered to 'SD' once the company completes its proposed debt restructuring. Following the completion of the restructuring, we expect to review our issuer credit rating on Vialto and issue-level rating on its first-lien term loan, focusing on a forward-looking assessment of the company's creditworthiness including liquidity, capital structure, and business prospects." COMPLETE BEVERAGE: Gets OK to Use Cash Collateral Until Dec. 18 --------------------------------------------------------------- The United States Bankruptcy Court for the Southern District of Florida granted Complete Beverage Center Inc. authorization to continue using cash collateral through December 18, 2024. The court has approved the use of cash collateral for specific expenses, including quarterly fees to the US Trustee and necessary operating costs outlined in the Debtor's budget, which is $1,077,604 total operating expenses with a 10% allowance per line item. The Debtor is required to make monthly payments of $1,575.00 to its secured lender and maintain sufficient funds in its DIP account. The secured creditors have been granted replacement liens on post-petition proceeds, and the Debtor must continue to insure its inventory. The court has also outlined inspection rights for the lender, access to the Debtor's records and premises, and the rights of the US Trustee or any committee to challenge the validity of liens. The next hearing is scheduled for December 11, 2024. About Complete Beverage Center Complete Beverage Center Inc. filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla.Case No. 24-16099) on June 20, 2024, listing $100,001 to $500,000 in assets and up to $50,000 in liabilities. Judge Scott M. Grossman oversees the case. The Debtor tapped David W. Langley, Esq., as counsel and Brevda CPA, PA as accountant. COST LESS DISTRIBUTING: Gets Interim OK to Use Cash Collateral -------------------------------------------------------------- The United States Bankruptcy Court for the Eastern District of Michigan, Southern Division granted Cost Less Distributing, Inc. authorization to use cash collateral on an interim basis and setting a final hearing. The court has also authorized the debtor to spend $176,715.38 between October 30, 2024, and November 13, 2024. The order must be served on all secured creditors, the 20 largest creditors, and the United States Trustee within 24 hours of its entry. About Cost Less Distributing Cost Less Distributing Inc. is a family-owned company in the pet treat and pet food industry. In addition to its pet treat program, the company now offers cell phone charger cable, Cooper Street cookies for humans, and will soon introduce its own small batch, gourmet popcorn. Cost Less Distributing sought relief under Subchapter V of Chapter 11 of the U.S. Bankruptcy Code (Bankr. E.D. Mich. Case No. 24-31912) on October 7, 2024, with up to $50,000 in assets and up to $10 million in liabilities. Matthew Ovadek, vice president, signed the petition. Judge Joel D. Applebaum oversees the case. The Debtor is represented by Peter T. Mooney, Esq., at Simen, Figura & Parker, PLC. DEL FUEGO: To Sell Restaurant to Michael Krychowecky for $850,000 ----------------------------------------------------------------- Del Fuego Paradise LLLP seeks permission from the U.S. Bankruptcy Court for the Southern District of Florida, West Palm Beach Division, to sell its restaurant, free and clear of all liens, claims, encumbrances, and interests. The Debtor is the owner of a restaurant, which is a substantially turnkey operation, including sophisticated tenant improvements and fixtures. The restaurant operates under a lease agreement with CNQ Investment, LLC, for the property located at 900 East Atlantic Avenue, Delray Beach FL 33428, Florida, with Meso Delray, LLC as tenant. Meso Delray assigned the lease to the Debtor. The Debtor wants to sell the restaurant in a private sale to Michael Krychowecky and/or assigns. The proposed sale is a private sale to the buyer, as opposed to an auction sale, in view of the prior marketing and sale efforts, the status of the case, and most importantly, the status of the Debtor's financial condition and operations. The Restaurant has been marketed by a competent broker for many months and the proposal by buyer represents the best offer received by the Debtor. The purchase price of the restaurant is $850,000, with $95,000.000 in the form of an escrow deposit having been delivered to the Escrow Agent, and an addition of $755,000 is payable at the closing under the purchase agreement. As part of the agreement, the Debtor is responsible for payment of the unpaid rent to cure the lease from the proceeds of the sale. The net effect is that no claims will be asserted against the Debtor's estate as result of the Lease as the Lease will be cured at closing. Consequently, effective upon the Closing Date, the Lease will be assumed and assigned without any claim asserted against the Debtor. The Deposit shall be transferred to the trust account of Kelley Kaplan & Eller, PLLC, to be held in trust and disbursed only as authorized by the final agreement, and Kelley Kaplan will be Escrow Agent under the agreement. At closing, the Buyer shall deliver to the Kelley Kaplan the purchase price closing payment less any deductions, if any, expressly authorized by the agreement that are expected to be none or nominal. The Debtor asserts that the sale contemplated in the agreement offers the best price and the best terms for the sale of the restaurant, particularly under the circumstances. About Del Fuego Paradise LLLP Del Fuego Paradise, LLLP in Delray Beach, FL, filed its voluntary petition for Chapter 11 protection (Bankr. S.D. Fla. Case No. 24-14934) on May 20, 2024, listing $5,500 in assets and $4,580,433 in liabilities. Daniel Murphy, Power of Attorney for Joseph DiNicole, Partner, signed the petition. Judge Mindy A. Mora oversees the case. KELLEY KAPLAN & ELLER, PLLC serve as the Debtor's legal counsel. EARTH HOUSE: No Change in Patient Care, 3rd PCO Report Says ----------------------------------------------------------- Debra Branch, the court-appointed patient care ombudsman, filed with the U.S. Bankruptcy Court for the District of New Jersey her third report regarding the quality of patient care provided at Earth House, Inc.'s mental health treatment center. The second PCO report, which covers the period from August 24 to October 23, is based on a telephone interview with the executive director held on October 17. During this reporting period, Earth House received approximately half of the ERTC expected tax refund. Earth House said that several organizations and individuals have expressed interest in purchasing or investing in the facility. The PCO found that there are 15 full-time and part-time staff members. Most of the mental health industry entry level positions are filled by Rutgers students. Earth House said that there have been no significant changes in staff during this reporting period. Ms. Branch observed that Earth House maintains a medication management system that tracks and controls all medication that is used in the center. Medications are logged and stored in a dedicated room that is locked and managed by the administration. Earth House said that there have been no changes in the management of pharmaceuticals since its Chapter 11 filing. The PCO noted that medical records and treatment plans are stored in locked cabinets that are maintained in a storage room with a padlocked door. Security and confidentiality of records appear to be maintained. Earth House said that there have been no changes in the management of records since its bankruptcy filing. Pursuant to Section 333(b)(3) of the Bankruptcy Code, the quality of patient care provided patients has been maintained since the filing. Direct Care staffing continues to be relatively stable. The bankruptcy filing has not affected Earth House's ability to continue to deliver to risky psychiatric patients a unique and innovative program with a good standard of care. A copy of the ombudsman report is available for free at https://urlcurt.com/u?l=KZnjRP from PacerMonitor.com. The ombudsman may be reached at: Debra H. Branch, Esq. Law Office of Debra H. Branch 1814 E. Route 70, Ste 411 Cherry Hill, NJ 08003 Phone: (856)489-7163 Email: DHBRANCH@aol.com About Earth House Earth House, Inc. is a health care business as defined in 11 U.S.C. Sec. 101(27A). Earth House filed Chapter 11 petition (Bankr. D.N.J. Case No. 24-11142) on Feb. 6, 2024. In the petition signed by its executive director, James F. Karwoski, the Debtor disclosed as much as $1 million in both assets and liabilities. Judge Christine M. Gravelle oversees the case. The Law Firm of Andre L. Kydala serves as the Debtor's bankruptcy counsel. Debra Branch is the patient care ombudsman appointed in the Debtor's bankruptcy case. EBURY STREET: Court Grants Emigrant's Motion to Remand Case ----------------------------------------------------------- The Honorable David S. Jones of the United States Bankruptcy Court for the Southern District of New York granted Emigrant Business Credit Corporation's motion for mandatory abstention and remand of the adversary proceeding captioned as EMIGRANT BUSINESS CREDIT CORPORATION, Plaintiff, - against – JOHN ARTHUR HANRATTY, EBURY STREET CAPITAL, LLC, EBURY FUND 1, LP, EBURY FUND 2, LP, EBURY 1EMI LLC, EBURY 2 EMI LLC, EB 1EMIALA LLC, EB 2EMIALA LLC, EB1EMIFL, LLC, EB 2 EMIFL, LLC, EB1 EMIIN, LLC, EB 2EMIIN, LLC, EB1 EMIMD, LLC, EB 2EMIMD, LLC, EB 1EMINJ, LLC, EB2EMINJ, LLC, EB 1EMINY, LLC, EB2EMINY, LLC, EB 1EMISC, LLC, EB2 EMISC, LLC, RE 1 EMI LLC, RE 2EMI LLC, EB 1EMIDC, LLC, ARQUE TAX RECEIVABLE FUND (MARYLAND), LLC, EBURY FUND 1 FL, LLC, EBURY FUND 2FL, LLC, EBURY FUND 1NJ, LLC, EBURY FUND 2NJ, LLC, RED CLOVER 1, LLC, EBURY RE LLC, and XYZ CORPS. 1-10, Defendants, Adv. Proc. No. 24-04020 (DSJ) (Bankr. S.D.N.Y.). On September 25, 2022, EBCC filed a breach-of-contract and fraud lawsuit against Defendant John Hanratty and a set of related and affiliated companies alleged by EBCC to be corporate alter egos of Hanratty in the Commercial Division of the Supreme Court of the State of New York, New York County. The State Court Action concerns an agreement between the parties whereby EBCC extended lines of credit to the Defendants to "finance their purchases of tax liens." EBCC alleges that the Defendants violated the parties' agreement and fraudulently diverted EBCC's collateral and funds advanced by the lines of credit, instead paying distributions to Hanratty and Hanratty's prior investors. EBCC alleges that the Defendants owe EBCC over $26 million as a result of the Defendants' alleged fraudulent scheme. Following the post-indictment restraining order, on May 13, 2024, the Debtor Defendants filed bankruptcy cases in the Alabama Bankruptcy Court. On August 12, 2024, the Debtor Defendants, joined by the non-Debtor Defendants, filed a Notice of Removal of the State Court Action to the U.S. District Court for the Southern District of New York. Defendants' Notice of Removal states that the State Court Action is related to the Alabama Bankruptcy Case within the meaning of 28 U.S.C. Sec. 157(a), and that the State Court Action constitutes a "core proceeding" within the meaning of 28 U.S.C. Sec. 157(b)(2)(A) and (O). Specifically, they contend that the Plaintiff's claims against the Defendants and the Defendants' counterclaims all affect the Debtor Defendants' estates. The specific claims in question involve the Defendants' alleged misappropriation of collateral used to secure a loan from Plaintiff, and Defendants' counterclaims for breach of contract, breach of the implied covenant of good faith and fair dealing, and other claims regarding Plaintiff's alleged violation of settlement terms between the parties concerning a loan. Thus, the Defendants argue that both Plaintiff's claims and Defendants' counterclaims necessarily affect the property of the bankruptcy estate, claims by and against the estate, and liquidation of estate assets. On the same day that the Defendants filed the Notice of Removal, on August 12, 2024, the Defendants also filed a Motion to Transfer Venue of the removed State Court Action to the Alabama Bankruptcy Court. The removed State Court Action was referred to the New York Bankruptcy Court on August 13, 2024. The Motion asserts that the New York Bankruptcy Court should remand the State Court Action for three independent reasons: (i) the Defendants failed to properly serve EBCC with the notice of removal and file a copy of it in the State Court Action pursuant to Federal Rules of Bankruptcy Procedure 9027(b) and 9027(c); (ii) the conditions for mandatory abstention are satisfied; and (iii) the factors considered for permissive abstention and equitable remand weigh in favor of remand. The Debtor Defendants contend that the New York Bankruptcy Court should deny the Motion because EBCC failed to file and properly serve the Motion upon the Debtor Defendants. On the merits, the Debtor Defendants contend that mandatory abstention does not apply because, they argue, the Debtor Defendants contest the nature and scope of the debt owed to EBCC in the State Court Action and in the Alabama Bankruptcy Court, thus giving rise to a core matter that a bankruptcy court should determine. The Debtor Defendants also assert that because permissive abstention requires a balancing of interests and considerations that go to the heart of the Debtors' operations, the Alabama Bankruptcy Court is the court best positioned to weigh these factors and render a decision. Therefore, the Debtor Defendants alternatively contend that the New York Bankruptcy Court should transfer venue to the Alabama Bankruptcy Court and allow that Court to decide the Motion. The New York Bankruptcy Court heard oral argument on the Motion on September 26, 2024. It grants the Motion because the Debtor Defendants have failed to meet their burden of showing that mandatory abstention is unwarranted and because in the circumstances it would waste party and judicial resources to grant the Debtor Defendants' request to transfer the matter to the Alabama Bankruptcy Court to allow that court to determine whether abstention and/or remand are appropriate. Because the standards governing permissive abstention or equitable remand call for weighing particulars of the bankruptcy case that is pending in Alabama, the New York Bankruptcy Court does not reach Plaintiff's alternative contention that permissive abstention or equitable remand is warranted. The New York Bankruptcy Court acknowledges that typically federal courts to which state court cases are removed will transfer the case to an out-of-state federal court presiding over the case that was the basis for removal. In this case, however, it concludes that abstention is clearly mandatory, such that it would be unnecessary and unwisely burdensome to delay deciding the Motion while requiring another round of briefing and argument before yet another court. A copy of the Court's decision is available at https://urlcurt.com/u?l=QmgQOJ About Ebury Street Capital Ebury Street Capital, LLC filed a Chapter 11 petition (Bankr. M.D. Ala. Case No. 24-10499) on May 13, 2024, with as much as $50,000 in both assets and liabilities. Judge Bess M. Parrish Creswell oversees the case. Richard Scott Williams, Esq., is the Debtor's legal counsel. EMERGE ENERGY: Superior Silica's Summary Judgment Bids Nixed ------------------------------------------------------------ Judge Thomas M. Horan of the United States Bankruptcy Court for the District of Delaware ruled on several motions filed by the parties in the case captioned as SUPERIOR SILICA SANDS LLC, a Texas limited liability company, Plaintiff, v. IRON MOUNTRAIN TRAP ROCK COMPANY, a Missouri Corporation, and FRED WEBER, INC., a Delaware corporation, Defendants, Adv. Pro. No. 20-51052 (TMH) (Bankr. D. Del.). Before the Court are two motions for partial summary judgment filed by Superior Silica Sands LLC and two cross-motions for partial summary judgment filed by Iron Mountain Trap Rock Company and Fred Weber, Inc. Specifically, Superior filed its Motion for Summary Judgment on Second Claim for Relief, and its Supplemental Motion for Partial Summary Judgment on Third Claim for Relief for Breach of Contract. The Defendants filed their Cross Motion for Summary Judgment and Cross-Motion for Partial Summary Judgment. In its Summary Judgment Motion Claim Two, Superior seeks declaratory relief regarding Defendants' status and obligations as an "Operator" under the Wisconsin Reclamation Statute, Wis. Admin. Code NR Sec. 135.01 et seq., and Chippewa County Code. In their Cross-Motion Claim Two, Defendants argue that the Wisconsin Reclamation statute does not contain a private right of action for Superior to obtain such relief. In its Summary Judgment Motion Claim Three, Superior seeks entry of a judgment finding that Defendants breached their contractual duties under the Wet Sands Services Agreement, and awarding damages. In the Defendants' Cross Motion Claim Three, Defendants argue, in part, that Superior's claim should be dismissed based on the Defendants' right to offset their claims detailed in their proof of claim. Also before the Court are two motions to strike filed by the Defendants. The Defendants first seek to strike the Declarations of Scott Waughtal for a lack of personal knowledge, reliance on inadmissible hearsay, untimely filings, and improper certification under 28 U.S.C. Sec. 1746. The Defendants also seek to strike portions of Superior's omnibus objection to the Defendants' Cross Motion Claim Two and reply brief in support of the Superior Summary Judgment Motion Claim Three. Superior's then-President and CEO of Richard J. Sheare sent two letters in December 2016 notifying FWI of its default under the WSSA for failure to reclaim the mine. Superior argues that the December 2016 Letters constitute inadmissible hearsay that form the basis of Mr. Waughtal's declaration. Accordingly, the Court determines that Mr. Waughtal has personal knowledge under Rule 56(c)(4), and that the December Letters are admissible under Rule 803(6). Superior leases a non-metallic sand quarry in Chippewa Falls, Wisconsin. On April 7, 2011, Superior and FWI entered into the WSSA. Wisconsin law governs the WSSA. By its second claim for relief, Superior requests entry of three forms of declaratory judgment. First, Superior seeks entry of a judgment declaring (i) IMTR an "Operator" of the Quarry under the Wisconsin Reclamation Statute and Chippewa County Code, (ii) FWI as a guarantor of IMTR's obligations under the Wisconsin Reclamation Statute and Chippewa County Code, and (iii) IMTR and FWI obligated under the WSSA to perform the role of an "Operator." Second, Superior requests entry of a judgment declaring that rejection of the WSSA does not release IMTR from its obligations as an "Operator" of the mine under the Wisconsin Reclamation Statute. Finally, Superior requests entry of a judgment declaring that FWI's guaranty of IMTR's obligations remains enforceable. Based on the record before it, the Court will not declare Defendants to be "Operators" under the Wisconsin Reclamation Statute. The Defendants' cross-motion for summary judgment on Claim Two is granted. Superior requests summary judgment on its third claim for relief. Superior claims that the WSSA obligated Defendants to carry out all reclamation activities in the Quarry, including final reclamation. Superior asserts that, in 2016, FWI breached its obligation to perform reclamation on the Quarry and that, together, the Defendants continue to breach their reclamation obligations. As a result, Superior claims it has suffered damages totaling $14,257,359 in the form of expenses related to its past and future reclamation activity. According to the Court, IMTR does not have a right to set off its pre-petition debts against Superior's post-petition damages. IMTR asserts a proof of claim for failure to pay the November 2018 Invoice and liquidated damages from the rejection of the WSSA. Both sets of damages occurred prepetition. However, Superior's asserted damages from reclamation work beginning in 2022 are post-petition damages, disqualifying IMTR from setoff, the Court states. Neither FWI nor IMTR has a right to setoff damages against Superior's post-petition damages. Superior seeks the entry of a judgment declaring that Defendants breached their obligations under the WSSA to carry out all reclamation, including final reclamation. Superior asserts that IMTR, as assignee under the WSSA, and FWI, as Guarantor of IMTR's performance, have an ongoing obligation to carry out final reclamation -- an obligation established prepetition. The Defendants assert that the rejection of the WSSA relieved the Defendants from their performance obligations under the WSSA. Second, the Defendants assert that the WSSA only required the Defendants to perform interim reclamation, not final reclamation. Having found ambiguity in the WSSA's terms, the Court now considers extrinsic evidence to determine the intent of the parties. Drawing all inferences in a light most favorable to the Defendants as the nonmoving parties, the Court determines that a reasonable jury could find in favor of the Defendants. Defendants assert that, given the suspension of mining operations in 2016, the mine still had eight years of mining activity left. The Court (i) denies the Defendants' Motion to Strike Waughtal Declaration (ii) denies the Defendants' Motion to Strike Reply; (iii) denies the Superior Motion for Summary Judgment Claim Two; (iv) denies the Superior Motion for Summary Judgment Claim Three; (v) grants the Defendants' Cross Motion Claim Two; and (vi) denies the Defendants' Cross Motion Claim Three. A copy of the Court's decision is available at https://urlcurt.com/u?l=eAKt7L About Emerge Energy Services LP Emerge Energy Services LP -- http://www.emergelp.com/-- is engaged in the mining, processing and distributing silica sand, a key input for the hydraulic fracturing of oil and gas wells. The Company and its affiliates conduct their mining and processing operations from facilities located in Wisconsin and Texas. In addition to mining and processing silica sand primarily for use in the oil and gas industry, they also, to a lesser degree, sell their sand for use in building products and foundry operations. Emerge Energy was formed in 2012 by management and affiliates of Insight Equity Management Company LLC and its affiliated investment funds. Emerge Energy Services and its affiliates protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 19-11563) on July 15, 2019. As of Sept. 30, 2018, the Debtors had total assets of $329,385,000 and total liabilities of $266,077,000. The Debtors tapped Richards, Layton & Finger, P.A. and Latham & Watkins LLP as bankruptcy counsel; Houlihan Lokey Capital Inc. as financial advisor; and Kurtzman Carson Consultants LLC as claims and noticing agent and administrative advisor. The Debtors also hired Ankura Consulting Group LLC to provide interim management services. EMPACADORA Y PROCESADORA: Insurer Wins Summary Judgment Bid ----------------------------------------------------------- Magistrate Judge Marcos E. Lopez granted Multinational Insurance Company's motion for summary judgment in the case captioned as LEILANYS RIVERA RODRÍGUEZ, et al., Plaintiffs, v. WENDCO OF PUERTO RICO, INC., et al., Defendants, CIVIL NO.: 22-1151 (MEL) (D.P.R.). This is a diversity jurisdiction torts action brought by Plaintiff Leilanys Rivera Rodríguez by herself and on behalf of her minor son, JJHR, and daughter, JSHR seeking to recover damages suffered as a result of a motor vehicle accident on February 28, 2017, that took the life of Luis Hernandez Lopez, consensual partner of Ms. Rodriguez and father to the minor children. On March 31, 2022, Plaintiffs filed a complaint before this Court against: Wendco of Puerto Rico Inc., a corporation that manages, operates, and owns in Puerto Rico the restaurant chain known as Wendy's; Empacadora y Procesadora de Sur, Inc. ("Empro"), a business that Wendco purchases its meat and poultry products from; Multinational Insurance Company, Empro's insurer; Fernando Torres-Torres, Jane Doe I, the Torres-Doe I Conjugal Partnership; Alexis Martínez-De Jesus, Jane Doe II,and the Martinez-Doe II Conjugal Partnership. On July 12, 2023, Plaintiffs filed an amended complaint regarding the same claims but identifying co-defendants John Erik Arroyo, Jane Doe III, the Arroyo-Doe III Conjugal Partnership, and MAPFRE PRAICO Insurance Company. In said complaint, Plaintiffs allege that Mr. Hernandez Lopez's death was the result of concurrent fault and/or negligence by Mr. Martinez-De Jesus, Mr. Torres, Mr. Arroyo, Wendco, Empro, and as such, they and their insurers Multinational and MAPRE are liable. On January 24, 2023, the Court issued a partial judgment dismissing Plaintiffs' claims against Empro without prejudice. On November 30, 2023, the Court issued a partial judgment dismissing Plaintiffs' claims against Mr. Martinez-De Jesus, the Martinez-Doe Conjugal Partnership, Mr. Torres, the Torres-Doe Conjugal Partnership, and all other generically named defendants without prejudice. Plaintiffs and Mr. Arroyo, the Arroyo-Doe III Conjugal Partnership, and MAPRE reached a settlement and the claims against them were dismissed with prejudice. Plaintiffs and Wendco also reached a settlement agreement, subject to a judicial authorization hearing. The party that remains is Multinational. Pending before the Court is Defendant Multinational's motion for summary judgment. In this case, Plaintiffs allege that Empro, Multinational's insured, is vicariously liable for the negligence of Mr. Arroyo. Multinational argues they are not liable for three reasons. First, they argue that Plaintiffs' claim is precluded under the doctrine of res judicata. Next, Multinational argues that its insured, Empro, is not liable for the injuries caused by its independent contractor. Lastly, Multinational argues Plaintiffs' claims are time-barred. In their motion for summary judgment, Defendant Multinational argues that all requirements of the res judicata doctrines have been met because Plaintiffs already presented the same claim on July 5, 2022, in a proceeding before the U.S. Bankruptcy Court -- In re: Empacadora y Procesadora del Sur, Inc., Case No. 22-bk-00354 (MAG), the claim was already decided when the Bankruptcy Court disallowed Plaintiffs' claim on November 3, 2022, and the claim was terminated without appeal. Plaintiffs opposed Defendant's arguments, stating that the res judicata doctrine is inapplicable under these facts because Puerto Rico is a direct-action jurisdiction which allows Plaintiffs to claim directly from the insurance company without the need to claim from the insured. Moreover, they argue that Multinational's liability insurance policy specifically states that bankruptcy or insolvency of the 'insured' shall not relieve Multinational of any obligations under this policy. Defendant submits that, with respect to Empro, the applicable form of res judicata is claim preclusion. The particular claim that Multinational argues is entitled to preclusive effect was made before a federal bankruptcy court; therefore, federal common law controls the question of claim preclusion in this case. The first element of claim preclusion is whether a final judgment was entered on the merits in the earlier proceeding. In this instance, the issue is whether a bankruptcy court's order is a final judgment on the merits for purposes of claim preclusion. Empro, Multinational's insured, filed for voluntary bankruptcy relief under Chapter 11 of the Bankruptcy Code on February 15, 2022. Plaintiffs appeared in Empro's bankruptcy case and filed Proof of Claim No. 18, on July 5, 2022. On September 28, 2022, Empro filed their Objection to Claim. Empro's Objection to Claim was served onto Plaintiffs, and taking into account that no "replies or objections having been filed timely" by Plaintiffs, the Bankruptcy Court granted Empro's Objection to Claim, disallowing the claim. Judge Lopez explains that Empro objected to Plaintiffs' Claim No. 18 both on the merits and on procedural grounds, asserting that Empro was not legally responsible for the death of Mr. Hernandez-Lopez. In the prayer for relief, Empro asked the Bankruptcy Court to enter an Order granting the instant objection to Plaintiffs' claim and 'totally disallowing Proof of Claim No. 18.' The Bankruptcy Court's order granting the Objection's request to disallow Claim No. 18 was a final order. Plaintiffs were notified of Empro's Objection to Claim No. 18. While Plaintiffs did not reply to Empro's objection, claim preclusion bars the re-litigation of 'any issue that was, or might have been, raised in respect to the subject matter of the prior litigation.' Plaintiffs did not move the Bankruptcy Court for reconsideration, nor did they appeal the order granting Empro's objection to Claim No. 18. Therefore, the first element of claim preclusion is met as the Bankruptcy Court's Order constitutes a final judgment on the merits." The Court finds Plaintiffs' claim against Multinational is precluded under the doctrine of res judicata. Therefore, Defendant's motion for summary judgment is granted. Hence, Plaintiffs' claims against Multinational are dismissed with prejudice. A copy of the Court's decision is available at https://urlcurt.com/u?l=Ig0TQl About Empacadora Y Procesadora Del Sur, Inc. Empacadora Y Procesadora Del Sur, Inc. sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D.P.R. Case No. 22-00354) on February 15, 2022. In the petition signed by Carlos C. Rodriguez Alonso, president, the Debtor disclosed $11,604,565 in assets and $10,598,204 in liabilities. Judge Maria De Los Angeles Gonzalez oversees the case. Alexis Fuentes Hernandez, Esq., at Fuentes Law Office, represents the Debtor as counsel. FIDDLERS GREEN: Files Chapter 11 Bankruptcy in Texas ---------------------------------------------------- On November 4, 2024, Fiddlers Green LLC filed Chapter 11 protection in the Northern District of Texas. According to court filing, the Debtor reports between $1 million and $10 million in debt owed to 1 and 49 creditors. The petition states that funds will be available to unsecured creditors. A meeting of creditors under Sec. 341(a) to be held on December 9, 2024 at 1:30 PM. About Fiddlers Green LLC Fiddlers Green LLC is a Single Asset Real Estate debtor (as defined in 11 U.S.C. Section 101(51B)). Fiddlers Green LLC sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Tex. Case No. 24-33556) on November 4, 2024. In the petition filed by Dan Blackburn, as president, the Debtor reports estimated assets and liabilities between $1 million and $10 million each. The Debtor is represented by: Robert Buchholz, Esq. THE LAW OFFICE OF ROBERT W. BUCHHOLZ, P.C. 5220 Spring Valley Road, Suite 618 Dallas, TX 75254 Tel: (214) 754-5500 Email: BOB@ATTORNEYBOB.COM FIREPAK INC: Seeks Chapter 11 Bankruptcy Protection --------------------------------------------------- On November 7, 2024, Firepak Inc. filed Chapter 11 protection in the Southern District of Florida. According to court documents, the Debtor reports $2,424,737 in debt owed to 1 and 49 creditors. The petition states that funds will be available to unsecured creditors. A meeting of creditors under Sec. 341(a) to be held on December 10, 2024 at 12:00 PM About Firepak Inc. Firepak Inc. specializes in the design and layout of fire sprinkler systems, modifications to existing fire sprinkler systems, new installations, tenant build outs, retrofit of existing buildings, and inspections and repairs of all types of fire sprinkler systems. Firepak Inc. sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Fla. Case No. 24-21725) on November 7, 2024. In the petition filed by Tatiana Marina, as chief financial officer, the Debtor reports total assets of $1,454,421 and total liabilities of $2,424,737. Honorable Bankruptcy Judge Robert A. Mark handles the case. The Debtor is represented by: Carlos de Zayas, Esq. LYDECKER LLP 1221 Brickell Ave. 19th Floor Miami FL 33131 Tel: 305-416-3180 E-mail: cdz@lydeckerdiaz.com FIRSTENERGY NUCLEAR: 3rd Circuit Affirms Dismissal of Daman Suit ---------------------------------------------------------------- In the case captioned as THOMAS DAMAN, Appellant, v. FIRSTENERGY CORP; FIRSTENERGY NUCLEAR OPERATING CO, formally a subsidiary of FirstEnergy Corp; ENERGY HARBOR NUCLEAR CORP, formally known as FirstEnergy Nuclear Operating Company, (3rd Cir.), the United States Court of Appeals for the Third Circuit affirmed the judgment of the United States District Court for the Western District of Pennsylvania that granted the defendants' motion to dismiss the complaint filed by Daman claiming violations of a collective bargaining agreement between FirstEnergy Nuclear Operating Company and his union, IBEW Local 29. Thomas Daman was hurt on the job while employed by FirstEnergy Nuclear Operating Company at its Beaver Valley Power Station in Pennsylvania. He received disability pay for some time, then allegedly was forced to retire. It is further alleged that FirstEnergy told Daman that he could return to work when his health improved, yet refused to reinstate him even after he received medical clearance from a physician. Daman filed a grievance against FirstEnergy in accordance with a collective bargaining agreement between the company and Daman's union, IBEW Local 29. The grievance was ultimately withdrawn as part of contractual negotiations between the union and FirstEnergy. Daman was notified of the withdrawal on January 18, 2019. More than three years later, Daman filed a pro se action in state court against FirstEnergy and two related entities. Daman claimed violations of the CBA. He sought re-employment and recovery of lost wages and benefits. Characterizing Daman's complaint as raising "hybrid" claims under Sec. 301 of the Labor Management Relations Act, 29 U.S.C. Sec. 185(a). Defendants removed the case to federal court, pursuant to 28 U.S.C. Secs. 1441 and 1446. Defendants then filed a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), arguing that Daman's claims were untimely raised and, in any event, inadequately pleaded. The District Court granted the motion to dismiss, agreeing with Defendants that Daman's claims were untimely under the six-month limitations period governing Sec. 301 "hybrid" claims. At the same time, the District Court offered Daman leave to amend his complaint in order to set forth allegations to support equitable tolling of the limitations period. Daman then filed an amended complaint; Defendants filed another motion to dismiss; and the District Court granted the new motion and dismissed Daman's amended complaint with prejudice, concluding that his claims were facially untimely and that he had failed to plausibly plead a viable basis for equitable tolling. After the District Court refused to reconsider its decision, Daman filed this pro se appeal. Daman presents three issues on appeal. With the first, he contends that the District Court erred in failing to address his "petition to quash" Defendants' joint removal notice, which filing would have been properly construed as a motion to remand the case to state court. Daman's second argument is that the District Court erred by applying the six-month limitations period for Sec. 301 "hybrid" claims, cf. 29 U.S.C. sec. 160(b), instead of the four-year period governing contract claims under Pennsylvania law, cf. 42 Pa. Cons. Stat. Ann. Sec. 5525(a)(1). He is incorrect, the Third Circuit says. As pleaded, Daman's claims explicitly invited consideration of whether there was a breach of the CBA between First Energy and the union, and of whether the union had breached its duty of fair representation. It was thus entirely proper for the District Court to construe those claims as arising under Sec. 301 of the LMRA. Application of the LMRA includes testing claims against a six-month limitations period; the District Court, therefore, did not err in administering that test, the Third Circuit concludes. Finally, Daman argues that the District Court erred in determining that no viable theory of equitable tolling could be found in the amended complaint or Daman's supplemental filings. The Third Circuit rejects this argument. It explains, 'Equitable tolling is appropriate in three general scenarios: (1) where a defendant actively misleads a plaintiff with respect to her cause of action; (2) where the plaintiff has been prevented from asserting her claim as a result of other extraordinary circumstances; or (3) where the plaintiff asserts her claims in a timely manner but has done so in the wrong forum.' For substantially the reasons given by the District Court in its memorandum opinion, Daman failed to plausibly plead that either the COVID-19 pandemic, or his initiation of proceedings with the Workers' Compensation Office of Adjudication, presented an extraordinary blockade throughout the period in which he could have timely brought his claims to court." A copy of the Court's decision is available at https://urlcurt.com/u?l=2YcPkG About Energy Harbor Energy Harbor, formerly FirstEnergy Solutions, is a subsidiary of FirstEnergy Corp (NYSE:FE). FES -- http://www.firstenergycorp.com/ -- provides energy-related products and services to retail and wholesale customers; and owns and operates 5,381 MWs of fossil generating capacity through its FirstEnergy Generation subsidiaries. FES also owns 4,048 MWs of nuclear generating capacity through its FirstEnergy Nuclear Generation subsidiary. Nuclear generating plants are operated by FirstEnergy Nuclear Operating Company (FENOC), which is a separate subsidiary of FirstEnergy Corp. On March 31, 2018, FirstEnergy Solutions and 6 affiliates, including FENOC, each filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code (Bankr. N.D. Ohio Lead Case No. 18-50757). The cases are pending before the Honorable Judge Alan M. Koschik and their cases be jointly administered under Case No. 18-50757. Parent company, First Energy Corp. and its other subsidiaries, including its regulated subsidiaries, are not part of the filing and will not be subject to the Chapter 11 process. First Energy Corp. listed $42.2 billion in total assets against $4.07 billion in total current liabilities, $21.1 billion in long-term debt and other long-term obligations and $13.1 billion in non-current liabilities as of Dec. 31, 2017. The Debtors tapped Akin Gump Strauss Hauer & Feld LLP as bankruptcy counsel; Brouse McDowell LPA as co-counsel; Lazard Freres & Co. as investment banker; Alvarez & Marsal North America, LLC, as restructuring advisor and Charles Moore as chief restructuring officer; and Prime Clerk as claims and noticing agent. The Debtors also tapped Willkie Farr & Gallagher LLP, Hogan Lovells US LLP and Quinn Emanuel Urquhart & Sullivan, LLP as special counsel. The U.S. Trustee for Region 9 appointed an official committee of unsecured creditors on April 12, 2018. Milbank, Tweed, Hadley & McCloy LLP and Hahn Loeser & Parks LLP serve as counsel to the committee. FREE SPEECH: Alex Jones Sues The Onion, Parents on Infowars Bid --------------------------------------------------------------- James Nani and Alex Wolf of Bloomberg Law reports that Alex Jones, a right-wing conspiracy theorist, has filed a lawsuit against the parents of Sandy Hook Elementary School shooting victims, The Onion's parent company, and a bankruptcy trustee, alleging they conspired to secure the winning bid for his Infowars media company. The complaint, filed Monday, November 18, 2024, in the U.S. Bankruptcy Court for the Southern District of Texas, seeks to invalidate the $1.75 million bid submitted by Global Tetrahedron LLC, backed by some Sandy Hook families. Jones claims the bid was unfairly prioritized over higher offers, including a $3.5 million cash bid from First United America Companies LLC, which operates ShopAlexJones.com, the report states. According to Bloomberg Law, the lawsuit comes as bankruptcy trustee Christopher Murray oversees the liquidation of Jones' estate to satisfy $1.5 billion in defamation judgments related to Jones' false claims that the 2012 Sandy Hook shooting was a hoax. Murray defended the process, describing it as "fair and open" and highlighting the Global Tetrahedron bid's total valuation of over $7 million, including waivers by Sandy Hook families of their rights to collect sale proceeds. First United has also moved to disqualify Global Tetrahedron's bid, accusing the participants of collusion. Murray dismissed these allegations, calling them unsubstantiated and an attempt to mislead the court. Chris Mattei, attorney for the Sandy Hook families, reaffirmed his clients' commitment to holding Jones accountable. "The families have consistently sought justice and will not be deterred," Mattei said. Jones maintains that First United should have been declared the winner and dismissed Murray's decision. The Onion CEO Ben Collins responded to Jones' accusations, calling them another baseless conspiracy theory. The case, In re Alexander E. Jones, is being heard in the U.S. Bankruptcy Court for the Southern District of Texas, case number 22-33553. Multiple legal teams are representing the involved parties as the dispute continues. About Free Speech Systems Free Speech Systems LLC is a broadcast media production and distribution company that provides broadcasting aural programs by radio to the public. Free Speech Systems is a family-run business founded by Alex Jones. FSS is presently engaged in the business of producing and syndicating Jones' radio and video talk shows and selling products targeted to Jones' loyal fan base via the Internet. Today, FSS produces Alex Jones' syndicated news/talk show (The Alex Jones Show) from Austin, Texas, which airs via the Genesis Communications Network on over 100 radio stations across the United States and via the internet through websites including Infowars.com. Due to the content of Alex Jones' shows, Jones and FSS have faced an all-out ban of Infowars from mainstream online spaces. Shunning from financial institutions and banning Jones and FSS from major tech companies began in 2018. Conspiracy theorist Alex Jones has been sued by victims' family members over Jones' lies that the 2012 Sandy Hook Elementary School shooting was a hoax. Jones' InfoW LLC and affiliates, IWHealth, LLC and Prison Planet TV, LLC, filed petitions under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. S.D. Texas Lead Case No. 22-60020) on April 18, 2022. FREE SPEECH: FUAC Wants to Disqualify The Onion's Winning Bid ------------------------------------------------------------- James Nani of Bloomberg Law reports that the losing bidder for Alex Jones' Infowars media empire is attempting to have The Onion's winning bid disqualified, arguing that the satirical news site's offer is lower than its own. First United American Companies LLC (FUAC), which runs ShopAlexJones.com, submitted an emergency motion claiming that its $3.5 million cash bid was higher than the $1.75 million offered by Global Tetrahedron LLC, the parent company of The Onion, the report related. In its motion to the U.S. Bankruptcy Court for the Southern District of Texas, FUAC accused The Onion of colluding with certain families of the Sandy Hook Elementary School shooting victims who supported the bid. This filing follows concerns raised last week by Judge Christopher M. Lopez regarding the auction's transparency, the report states. According to Bloomberg Law, Trustee Christopher Murray, who is overseeing the liquidation of Jones' estate to help satisfy approximately $1.5 billion in defamation judgments, stated that The Onion's bid was considered the best value due to some Sandy Hook families agreeing to waive part of their claims against Jones. Murray defended the auction as "fair and open." FUAC, however, contended that the families' waiver of claims provided no actual value to the bankruptcy estate, likening it to "monopoly money." The company argued that The Onion's bid doesn't add any cash to the estate and thus holds no real value, the report cites. The case, Jones, Bankr. S.D. Tex., No. 22-33553, remains under review following FUAC's emergency motion. About Free Speech Systems Free Speech Systems LLC is a broadcast media production and distribution company that provides broadcasting aural programs by radio to the public. Free Speech Systems is a family-run business founded by Alex Jones. FSS is presently engaged in the business of producing and syndicating Jones' radio and video talk shows and selling products targeted to Jones' loyal fan base via the Internet. Today, FSS produces Alex Jones' syndicated news/talk show (The Alex Jones Show) from Austin, Texas, which airs via the Genesis Communications Network on over 100 radio stations across the United States and via the internet through websites including Infowars.com. Due to the content of Alex Jones' shows, Jones and FSS have faced an all-out ban of Infowars from mainstream online spaces. Shunning from financial institutions and banning Jones and FSS from major tech companies began in 2018. Conspiracy theorist Alex Jones has been sued by victims' family members over Jones' lies that the 2012 Sandy Hook Elementary School shooting was a hoax. Jones' InfoW LLC and affiliates, IWHealth, LLC and Prison Planet TV, LLC, filed petitions under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. S.D. Texas Lead Case No. 22-60020) on April 18, 2022. GREATER LIBERTY: To Sell Bronx Property to Christ International --------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York has granted Greater Liberty Pentecostal Church Inc., through its counsel Penachio Malara LLP, to shorten the notice period of the sale of its real property located at 450 East 172nd Street, Bronx, NY, to Christ International Mission, free and clear of all claims. The Debtor is a non-for-profit entity that operates the Church from the Property. According to the Debtor, the Church is an integral part of its community located in the Morrisania section of the Bronx. The Debtor is set sell its property to Christ International Mission in the sale price of $875,000, subject to a financing contingency in the amount of $612,500.00. The Court ordered that the hearing shall be held on November 26, 2024 at 2:00 p.m. (Prevailing Eastern Time). The Debtor is also set to serve a copy of the Sale Motion to TD Bank, the U.S. Trustee, and the Sub Chapter V Trustee. Any objections and/or responses shall be filed on or before November 25, 2024 at 5:00 PM and served by email on counsel for the Debtor. About Greater Liberty Pentacostal Church, Inc. Greater Liberty Pentacostal Church filed a petition under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. S.D.N.Y. Case No. 23-11473) on Sept. 11, 2023, with as much as $50,000 in assets and $100,001 to $500,000 in liabilities. Jolene Wee of JW Infinity Consulting, LLC has been appointed as Subchapter V trustee. Judge Philip Bentley oversees the case. Anne J. Penachio, Esq., at Penachio Malara, LLP represents the Debtor as legal counsel. GUARDIAN ELDER: PCO Submits First Report ---------------------------------------- Margaret Barajas, the patient care ombudsman, filed with the U.S. Bankruptcy Court for the Western District of Pennsylvania her first report regarding the quality of patient care provided by Guardian Elder Care at Johnstown, LLC and affiliates. The PCO found that seven cases have been opened on behalf of residents at Guardian Healthcare Meadowcrest facility in calendar year 2024. There were numerous complaints regarding care and respect from staff; disregard for resident preferences; and call bells turned off without assistance provided. The PCO observed that staff was visible in all areas during a visit by the local ombudsman at Beaver Valley Healthcare and Rehabilitation Center. The facility smelled clean, and rooms appeared to be tidy. An activities calendar is posted but outside or community activities were not available. Ms. Barajas noted that a resident who had arrived at Hilltop Healthcare and Rehabilitation Center for rehab was told he could not go home due to the necessity for 24/7 care. He had tested positive for COVID while in the facility. The ombudsman explained to the social worker that all options must be discussed with the resident. The PCO visited Guardian Healthcare Highland View facility and reported three cases have been opened on behalf of residents in calendar year 2024. A resident reported that call bells were not answered in a timely manner. The resident later reported that the situation had improved. In another case, the resident reported the facility van had broken down, causing transportation problems. During the September 17 visit at Oak Hill Healthcare and Rehabilitation Center, the PCO discovered residents and staff complained of being understaffed. The Nursing Home Administrator was notified by residents and staff, and the issue was not resolved. The staff also failed to wear badges. The ombudsman filed a complaint with the Department of Health field office in Johnstown. About Guardian Elder Care at Johnstown Guardian Elder Care at Johnstown, LLC (doing business as Richland Healthcare and Rehabilitation Center), its affiliates, and their non-debtor affiliates are a private, family-owned organization that has provided inpatient and outpatient services to predominately small and/or rural communities through a network of skilled nursing facilities and personal care homes since 1995. Guardian Healthcare maintains 19 skilled nursing facilities, with one facility in West Virginia and the remaining facilities located in Pennsylvania. Through its facilities, Guardian Healthcare maintains more than 1,700 skilled nursing, personal care, and independent living beds, providing long-term care and rehabilitation services. Guardian Elder Care at Johnstown and its affiliates sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. W.D. Pa. Lead Case No. 24-70299) on July 29, 2024. In the petitions signed by Allen Wilen, chief restructuring officer, Guardian Elder Care at Johnstown disclosed up to $10 million in assets and up to $50 million in liabilities. Judge Jeffery A. Deller oversees the cases. The Debtors tapped Saul Ewing, LLP as legal counsel, Eisner Advisory Group, LLC as financial advisor, and Omni Agent Solutions, Inc. as claims and noticing agent. The U.S. Trustee for Region 3 appointed an official committee to represent unsecured creditors in the Debtors' Chapter 11 cases. Margaret Barajas is the patient care ombudsman appointed in the Debtors' Chapter 11 cases. HIGHLAND CAPITAL: Dondero, et al.'s Bid for Mandamus Relief Fails ----------------------------------------------------------------- In the case captioned as James Dondero; Highland Capital Management Fund Advisors, L.P.; The Dugaboy Investment Trust; NexPoint Real Estate Partners, L.L.C.; Get Good Trust, Plaintiffs—Appellants, versus Stacey G. Jernigan; Highland Capital Management, L.P., Defendants—Appellees, No. 24-10287 (5th Cir.), the United States Court of Appeals for the Fifth Circuit affirmed the order of the United States District Court for the Northern District of Texas denying the appellants' petition for mandamus that sought the recusal of the presiding bankruptcy judge. Appellants James Dondero and affiliated entities Highland Capital Management Fund Advisors, L.P., The Dugaboy Investment Trust, NexPoint Real Estate Parnters, L.L.C., and Get Good Trust are parties to a bankruptcy proceeding in the Northern District of Texas. The instant appeal focuses on a series of recusal motions filed by the Dondero Parties beginning in March 2021 -- after the reorganization plan had been confirmed but before it took effect. The motions argued that Chief Judge Jernigan had developed an animus against the Dondero Parties that caused her impartiality to be reasonably questioned and thus required recusal under 28 U.S.C. Sec. 455. The Dondero Parties filed a petition for writ of mandamus in the district court seeking an order directing Chief Judge Jernigan to recuse herself. The district court denied the petition, finding that the Dondero Parties had "not proved ‘exceptional circumstances' sufficient to justify the extraordinary remedy of a writ of mandamus.'" The Dondero Parties timely appealed. As to the first requirement for mandamus relief, the Dondero Parties must show that they have no "other adequate means to attain the relief." In other words, they must show that any error by Chief Judge Jernigan is "irremediable on ordinary appeal." The Dondero Parties' petition easily meets this condition. Claims of judicial bias cannot wait for the ordinary appeals process to run its course. Mandamus is thus the appropriate means for relief in this case, according to the Fifth Circuit. As to the second requirement for mandamus relief, the Dondero Parties must show that their right to the writ is "clear and indisputable." That is, it must be clear and indisputable that Chief Judge Jernigan is required to recuse. The Dondero Parties cite various instances throughout the case that they contend show Chief Judge Jernigan harbors an actual and enduring bias and animus against them that is personal rather than judicial in nature. Placed in their proper context, none of these instances suffice to show that Chief Judge Jernigan's impartiality might be reasonably questioned or that she had a personal bias against the Dondero Parties requiring recusal under Sec. 455. The Fifth Circuit finds it is not clear and indisputable that Chief Judge Jernigan had personal bias against the Dondero Parties or that her impartiality might be reasonably questioned requiring recusal under 28 U.S.C. Sec. 455. The district court thus didn't abuse its discretion in finding that the Dondero Parties lack a clear and indisputable right to mandamus relief, the Appellate Court concludes. A copy of the Court's decision is available at https://urlcurt.com/u?l=C1ds9G About Highland Capital Management Highland Capital Management, LP was founded by James Dondero and Mark Okada in Dallas in 1993. Highland Capital is the world's largest non-bank buyer of leveraged loans in 2007. It also manages collateralized loan obligations. In March 2007, it raised $1 billion to buy distressed loans. Collateralized loan obligations are created by bundling together loans and repackaging them into new securities. Highland Capital Management sought Chapter 11 protection (Bank. D. Del. Case No. 19-12239) on Oct. 16, 2019. On Dec. 4, 2019, the case was transferred to the U.S. Bankruptcy Court for the Northern District of Texas and was assigned a new case number (Bank. N.D. Tex. Case No. 19-34054). Judge Stacey G. Jernigan is the case judge. At the time of the filing, Highland had between $100 million and $500 million in both assets and liabilities. The Debtor tapped Pachulski Stang Ziehl & Jones LLP as bankruptcy counsel, Foley & Lardner LLP as special Texas counsel, and Teneo Capital, LLC as litigation advisor. Kurtzman Carson Consultants, LLC, is the claims and noticing agent. The U.S. Trustee for Region 6 appointed a committee of unsecured creditors on Oct. 29, 2019. The committee tapped Sidley Austin LLP and Young Conaway Stargatt & Taylor LLP as bankruptcy counsel, and FTI Consulting, Inc. as financial advisor. IIG GLOBAL: Court Narrows Claims in Fraud Lawsuit ------------------------------------------------- The Honorable Michael E. Wiles of the United States Bankruptcy Court for the Southern District of New York ruled on the remaining claims in the case captioned as IIG Global Trade Finance Fund Limited (in Official Liquidation), et al., Plaintiffs, v. International Investment Group L.L.C., et al, Defendants, Adv. Pro. No. 23-01165 (MEW) (Bankr. S.D.N.Y.). Plaintiffs are the official liquidators of two investment funds organized under Cayman law. They seek to undo transfers that occurred in 2017 and also seek damages for alleged fraud and breaches of fiduciary duty. Defendants include International Investment Group L.L.C., an investment advisor, and the Trade Finance Trust, an entity that was formed by IIG. Defendants also include an indenture trustee and certain noteholders who were participants in a prior IIG orchestrated financing that began in 2013 and that was paid off in 2017. The parties have agreed that one of the named Noteholders is no longer in existence and that the claims against it may be dismissed. In 2013, an IIG-related company named Trade Finance Funding I Ltd. purchased a portfolio of "trade finance" loans from other IIG-related entities. TFFI raised funds by selling $220 million of notes to the Noteholders. Deutsche Bank Securities, Inc. (a non-party) was the underwriter for the sales of the TFFI Notes, and Deutsche Bank Trust Company Americas, a Defendant in this proceeding, acted as the indenture trustee. TFFI entered into a Collateral Management Agreement with IIG, under which IIG managed TFFI's investments and recommended new loans for TFFI to make or purchase. Some of the loans that TFFI purchased in 2013 were fictitious. Problems with the loan portfolio increased as time went by, and a growing number of bad loans were replaced by fictitious loans or with other nonperforming loans. By 2017, according to the Complaint, forty percent of the loans that TFFI purportedly held had come due but were in default. Investigations by DBTCA and by certain Noteholders in early 2017 allegedly revealed severe problems regarding the identities of the purported borrowers, the quality and value of the loans, and the lack of collateral that was supposed to secure the loans. These investigations allegedly made clear that IIG had lied about such matters in its prior reports to DBTCA and the Noteholders. The Complaint alleges that, with the knowledge and substantial assistance of DBTCA and the Noteholders, IIG found new victims for its fraud in 2017. The Complaint alleges that IIG engaged in other fraudulent activities in its dealings with GTFF and STFF after August 2017, including the sale of participation interests in additional loans that were non-performing or fictitious. IIG's fraud allegedly continued until IIG became the subject of an SEC inquiry in 2018, which led to civil and criminal charges against IIG and its principals in 2019. IIG's principals later pleaded guilty to charges that they had committed fraud. The Complaint in this adversary proceeding alleges 17 causes of action. However, the Liquidators informed the Court at oral argument that they are not pursuing counts 7 and 15, which asserted tort and conspiracy claims under Cayman law. The Liquidators have asserted the remaining 15 claims in three different capacities. First, the Liquidators assert six claims (counts 1 through 6 of the Complaint) that belonged to the Investors and that the Investors have assigned to the Liquidators. As to these claims the Liquidators stand in the shoes of the Investors. Two of the assigned claims (counts 1 and 2) allege that the 2017 transfers made by GTFF and STFF (as transferors) to TFT (as transferee) were fraudulent conveyances under the version of the New York Debtor and Creditor Law that was in effect in 2017. One claim (count 6) alleges that those same transfers were "undervalue" transactions that can be avoided under Cayman law. Count 3 alleges that the Investors were the victims of a fraud perpetrated by IIG, and counts 4 and 5 allege that the Noteholders and DBTCA aided and abetted that fraud. Second, the Liquidators have asserted seven claims (counts 8 through 14) that allegedly belong to GTFF and STFF. As to those claims the Liquidators stand in the shoes of GTFF and STFF. Count 8 alleges a breach of contract by TFT. Counts 9 and 10 allege that the 2017 transfers made by TFT (as transferor) to DBTCA (as transferee) were fraudulent conveyances under New York law, and count 14 alleges that the same transfers were "undervalue" transfers that can be avoided under Cayman law. Count 11 alleges that IIG breached fiduciary duties that it owed to GTFF and STFF, and counts 12 and 13 allege that DBTCA and the Noteholders aided and abetted those breaches of fiduciary duty. Third, the Liquidators have asserted two claims (counts 16 and 17) that are statutory causes of action under Cayman law. As to these two claims the Liquidators contend that they act in their official capacities as liquidators of the GTFF and STFF estates. Count 16 alleges that the 2017 transfers that GTFF and STFF made to TFT were undervalue transactions made with intent to defraud. Count 17 alleges that the Defendants were knowing parties to a fraud and are liable under section 147 of the Cayman Companies Act to make such contributions to the company's assets as the Court deems proper. IIG and TFT have not appeared or filed answers or motions, and no challenge has been posed to the sufficiency of the fraud, breach of contract and breach of fiduciary duty claims that have been filed against them in counts 3, 8 and 11 of the Complaint. DBTCA or the Noteholders, or both, have moved to dismiss all of the other claims in the Complaint on a variety of theories. The Court ruled as follows: (a) all claims asserted against BlueMountain Credit Opportunities Master Fund I L.P. are dismissed; (b) the Cayman common law claims (counts 7 and 15) are dismissed, by consent and with prejudice, as to all Defendants; (c) two of the Cayman undervalue claims (counts 6 and 14) are dismissed as to all Defendants, with prejudice; (d) the aiding and abetting claims (counts 4, 5, 12 and 13) are dismissed, but without prejudice and with leave to replead; (e) DBTCA's motion to dismiss counts 1, 2, 9 and 10 against it is denied as to amounts that DBTCA applied in payment of its own fees but is granted, as to DBTCA, with respect to other funds that DBTCA received and paid to the Noteholders, but without prejudice and with leave to replead; and (f) Defendants' motions to dismiss are otherwise denied insofar as they relate to counts 1, 2, 9, 10, 16 and 17 of the Complaint. A copy of the Court's decision is available at https://urlcurt.com/u?l=9r5T7p Attorneys for Plaintiffs as to claims against International Investment Group L.L.C, Trade Finance Trust, the BlueMountain Defendants, the Tennenbaum Defendants, the Elanus Defendants and John Doe Subsequent Transferees: Patrick Fitzmaurice, Esq. John A. Pintarelli, Esq. PILLSBURY WINTHROP SHAW PITTMAN LLP 31 West 52nd Street New York, NY 10019 E-mail: patrick.fitzmaurice@pillsburylaw.com john.pintarelli@pillsburylaw.com Attorneys for Plaintiffs as to claims against the KKR Defendants and John Doe Subsequent Transferees Zachary D. Rosenbaum, Esq. Rachel K. Warren, Esq KOBRE & KIM LLP 800 Third Avenue New York, NY 10022 E-mail: zachary.rosenbaum@kobrekim.com rachel.warren@kobrekim.com Attorneys for Plaintiffs as to claims against Deutsche Bank Trust Company Americas: Andrew Zinman, Esq. SICHENZIA ROSS FERENCE CARMEL LLP 1185 Avenue of the Americas, 31st Floor New York, NY 10036 E-mail: azinman@srfc.law Attorneys for Defendant Deutsche Bank Trust Company Americas: Franke Morreale, Esq. HOLLAND & KNIGHT LLP 50 North Laura Street, Suite 3900 Jacksonville, FL 32202 E-mail: Frank.Morreale@hklaw.com Attorneys for Defendants KKR Credit Advisors (US) LLC, Corporate Capital Trust, Inc., KKR Debt Investors II (2006) (Ireland) L.P., KKR TRS Holdings, Ltd., and KKR-PBPR Capital Partners L.P.: Andrew J. Rossman, Esq. Deborah J. Newman, Esq. Blair A. Adams, Esq. QUINN EMANUEL URQUHART & SULLIVAN, LLP 51 Madison Avenue, 22nd Floor, New York, NY 10010 E-mail: andrewrossman@quinnemanuel.com deborahnewman@quinnemanuel.com blairadams@quinnemanuel.com Attorneys for Defendants Tennenbaum Capital Partners, LLC, Tennenbaum Senior Loan Fund II, LP, Tennenbaum Senior Loan Fund III, LP, Tennenbaum Senior Loan Fund IV-B, LP, and Special Value Continuation Partners, LLC: Philip D. Anker, Esq. Ross E. Firsenbaum, Esq. WILMER CUTLER PICKERING HALE AND DORR LLP 7 World Trade Center 250 Greenwich Street New York, NY 10007 E-mail: philip.anker@wilmerhale.com ross.firsenbaum@wilmerhale.com Attorneys for Assured Investment Management LLC (f/k/a BlueMountain Capital Management, LLC and n/k/a Sound Point Luna LLC), BlueMountain Foinaven Master Fund L.P., BlueMountain Loan Opportunities Master Fund L.P., BlueMountain Montenvers Master Fund SCA SICAV-SIF, BlueMountain Timberline Ltd., and BlueMountain Kicking Horse Fund L.P.: Philippe Z. Selendy, Esq. David S. Flugman, Esq. Claire O'Brien, Esq. SELENDY GAY ELSBERG PLLC 1290 Avenue of the Americas New York, NY 10104 E-mail: pselendy@selendygay.com dflugman@selendygay.com cobrien@selendygay.com Attorneys for Elanus Capital Management LLC and Elanus Capital Investment Master SPC on behalf of, and in the name of, Elanus Capital Investments Master SP Series I: Mark A. Weissman, Esq. OFFIT KURMAN PA 590 Madison Ave., 6th floor New York, NY 10022 E-mail: mark.weissman@offitkurman.com Hedge fund IIG Global Trade Finance Fund Ltd. commenced Chapter 15 bankruptcy proceedings (Bankr. S.D.N.Y. Case No. 20-10132) on January 17, 2020, to seek recognition of its proceedings in the Cayman Islands. The petition was filed by Christopher Kennedy and Alexander Lawson of Alvarez and Marsal Cayman Islands Ltd. John A. Pintarelli, Esq., at Morrison & Foerster LLP, represents the Chapter 15 petitioners. IKECHUKWU H. OKORIE: Loses Bid to Reopen Bankruptcy Case -------------------------------------------------------- In the Matter of Ikechukwu Hyginus Okorie, Debtor, Ikechukwu Hyginus Okorie, doing business as Inland Family Practice Center, L.L.C., doing business as Royal Oaks Rental Properties, L.L.C., doing business as St. Micheals Urgent Care of Hattiesburg, L.L.C., doing business as Slocum-Radson Medical Lab, Incorporated, Appellant, versus PriorityOne Bank, Appellee, No. 24-60376 (5th Cir.), the United States Court of Appeals for the Fifth Circuit upheld the order of the the United States District Court for the Southern District of Mississippi that affirmed the decision of the United States Bankruptcy Court for the Southern District of Mississippi to deny the debtor's motion to reopen his Chapter 11 case. In this bankruptcy case Appellant, Ikechukwu Hyginus Okorie, (Okorie or Appellant) proceeding pro se filed a Chapter 11 proceeding on November 6, 2018. Appellee, PriorityOne Bank (POB or Appellee), was a secured lender to Okorie collateralized with real property. On November 30, 2018, POB filed a motion for abandonment and request for termination of the Sec. 362 automatic stay or, in the alternative, request for adequate protection which the Court granted. On December 14, 2018, Okorie filed a motion to dismiss his Chapter 11 case. The bankruptcy court granted that motion and the case was dismissed on January 14, 2019 terminating the stay altogether, resulting in the case being closed on March 4, 2019. On June 7, 2019, after the case was dismissed, POB foreclosed on the subject property (collateral). Over two years later in 2021, Okorie filed a motion to vacate the order granting POB's motion for abandonment and termination of the stay. The bankruptcy court advised Okorie that the case was closed and that a motion to reopen must be filed and granted before his motion could be considered. A year and half later on June 13, 2023, Okorie filed his motion to reopen, claiming that he did not receive sufficient notice of POB's November 30, 2018 abandonment motion. The bankruptcy court denied the motion to reopen and held that Okorie had shown no cause to reopen as required under 11 U.S.C. Sec. 350(b). Okorie appealed that order to the district court, which affirmed the bankruptcy court's ruling. The sole issues raised by Okorie in this appeal of the district court order are that he did not receive notice of POB's November 30, 2018 motion for abandonment and request for termination of the automatic stay and the bankruptcy court and district court erred in not vacating that order. The obvious purpose of Okorie's motion was to have the automatic stay reinstated. But Okorie ignores the fact that, on December 14, 2018, the bankruptcy court granted his pro se voluntary motion to dismiss his bankruptcy petition. This action taken at Okorie's request terminated the stay altogether, resulting in the case being closed. POB foreclosed on the property on June 7, 2019, and purchased the collateral long after the bankruptcy proceeding was dismissed. The Fifth Circuit agrees with the district court and the bankruptcy court that Okorie's motion to reopen would have provided him no relief and was properly denied as futile. A copy of the Court's decision is available at https://urlcurt.com/u?l=3uBecM Ikechukwu H. Okorie filed for Chapter 11 bankruptcy protection (Bankr. S.D. Miss. Case No. 19-50379) on February 27, 2019, listing under $1 million in both assets and liabilities. The Debtor is represented by Patrick A. Sheehan, Esq. INTRUM SA: Judge Sets Schedule for Ch. 11 Case Dismissal Hearing ---------------------------------------------------------------- Dorothy Ma of Bloomberg Law reports that a bankruptcy judge has scheduled a hearing for December to address a request from a group of dissenting bondholders of Intrum AB, seeking to dismiss the Swedish debt collector's Chapter 11 case in the U.S. Judge Christopher M. Lopez confirmed that both Intrum's motion to approve its debt plan and the creditors' opposition will be heard on December 16, 2024 following a hearing in Texas, the report relates. The creditors, holding notes due in 2025, argued in court filings that Intrum's Chapter 11 filing lacks a "valid bankruptcy purpose," pointing out that the company has no operations or assets in the U.S. About Intrum AB Intrum AB is a Swedish debt collector. Intrum AB sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Case No. 24-90575) on November 15, 2024. In its petition, the Debtor reports estimated assets and liabilities both between $1 billion and $10 billion each. Honorable Bankruptcy Judge Christopher M. Lopez oversees the case. The Debtor is represented by John F Higgins, IV of Porter Hedges LLP. JBRI CONSTRUCTION: Kicks Off Chapter 11 Bankruptcy Process ---------------------------------------------------------- On November 4, 2024, JBRI Construction Services LLC filed Chapter 11 protection in the Southern District of Texas. According to court filing, the Debtor reports $1,597,807 in debt owed to 1 and 49 creditors. The petition states funds will be available to unsecured creditors. A meeting of creditors under Sec. 341(a) to be held on December 12, 2024 at 10:00 AM. About JBRI Construction Services LLC JBRI Construction Services LLC is a limited liability company. JBRI Construction Services LLC sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Case No. 24-35173) on November 4, 2024. In the petition filed by Thomas Benevegnu, as president, the Debtor reports total assets of $1,240,722 and total liabilities of $1,597,807. Honorable Bankruptcy Judge Eduardo V. Rodriguez handles the case. The Debtor is represented by: Julie M. Koenig, Esq. COOPER & SCULLY, P.C. 815 Walker St. Suite 1040 Houston TX 77002 Tel: (713) 236-6800 Email: julie.koenig@cooperscully.com K&L TRAILER: GFB Wins Summary Judgment Bid in FF&CB Case -------------------------------------------------------- Judge Suzanne H. Bauknight of the United States Bankruptcy Court for the Eastern District of Tennessee granted Greeneville Federal Bank's motion for summary judgment in the case captioned as GREENEVILLE FEDERAL BANK, FSB, Plaintiff, v. FIRST FARMERS AND COMMERCIAL BANK, Defendant, Adv. Proc. No. 3:23-ap-03010-SHB (Bankr. E.D. Tenn.). Plaintiff Greeneville Federal Bank initiated this adversary proceeding by the filing of its complaint seeking determination by the Court that GFB's properly perfected inventory lien has priority over the properly perfected liens of Defendant First Farmers & Commercial Bank in ten trailers that were transferred by GFB's debtor, K & L Sales & Leasing, Inc. to K&L Trailer Leasing, Inc. GFB and FF&CB filed cross-motions for summary judgment. This dispute requires the Court to apply Tennessee's version of Article 9 of the Uniform Commercial Code. The Court applies the law in this case exactly as it applied it in Greeneville Federal Bank, FSB v. Fellhoelter (In re K&L Trailer Leasing, Inc.), 630 B.R. 81 (Bankr. E.D. Tenn. 2021) (hereinafter "GFB I"). GFB argues that its perfected inventory lien on Sales's inventory remained attached to the Subject Trailers after they were transferred to Leasing because Leasing was not a buyer in the ordinary course and GFB did not consent to the transfers to Leasing. Concerning whether the transfers were sales to a buyer in the ordinary course of business under Tennessee Code Annotated section 47-1-201(9), for purposes of summary judgment, GFB focuses on the fact that the transfers were made by Kris Fellhoelter in his capacity as an owner of both Sales and Leasing and that he knew that transfer of the Subject Trailers would violate GFB's security interest. GFB relies on the express terms of its Revolving Loan Agreement and Security Agreement with Sales and on Tennessee Code Annotated sections 47-1-201(9) and 47-9-507, as applied by this Court in GFB I. FF&CB argues that the Court erred in its prior interpretation and application of Tennessee's codified UCC provisions. FF&CB primarily relies on Tennessee Code Annotated sections 47-9-311 and 55-3-126, which require liens to be noted on certificates of title for collateral subject to Tennessee's certificate-of-title laws unless the collateral is inventory held for sale by a person in the business of selling goods of that kind. It also argues in opposition to GFB's motion for summary judgment that GFB implicitly authorized transfer of the Subject Trailers from Sales to Leasing by GFB's acquiescence in the transfer of trailers that were not purchased directly by GFB's funding to Sales. Given the undisputed material facts, the Court concludes that secured transactions principles preserved GFB's properly perfected inventory lien when Sales transferred GFB's collateral to Leasing in transactions that were not in the ordinary course of business such that GFB's security interest in the ten trailers has priority over FF&CB's security interest in the same trailers. Therefore, the Court finds that summary judgment in favor of GFB is required under Tennessee law. A copy of the Court's decision is available at https://urlcurt.com/u?l=zWM2wG Attorneys for Plaintiff: Jerry W. Laughlin, Esq. LAUGHLIN, NUNNALLY, HOOD & CRUM, PC 100 South Main Street Greeneville, TN 37743-4922 Attorneys for Defendant: Scott M. Shaw, Esq. EVANS HARRISON HACKETT PLLC 835 Georgia Avenue, Suite 800 Chattanooga, TN 37402 E-mail: sshaw@ehhlaw.com About K & L Trailer Leasing K&L Trailer Leasing, Inc., a company based in Knoxville, Tenn., filed a Chapter 11 petition (Bankr. E.D. Tenn. Case No. 20-31620) on June 29, 2020. At the time of the filing, Debtor was estimated to have $10 million to $50 million in both assets and liabilities. Judge Suzanne H. Bauknight oversees the case. Gentry Tipton & McLemore, P.C., is the Debtor's bankruptcy counsel. Gary M. Murphey was appointed as Debtor's Chapter 11 trustee. He is represented by Bradley Arant Boult Cummings. LA MONARCA: Sec. 341(a) Meeting of Creditors on Dec. 6 ------------------------------------------------------ On November 4, 2024, La Monarca Investment Plus Management Group LLC filed Chapter 11 protection in the Southern District of Texas. According to court filing, the Debtor reports $382,000 in debt owed to 1 and 49 creditors. The petition states that funds will be available to unsecured creditors. A meeting of creditors under Sec. 341(a) to be held on December 6, 2024 at 3:00 PM. About La Monarca Investment Plus Management Group LLC La Monarca Investment Plus Management Group LLC is engaged in activities related to real estate. The Debtor is the owner of four properties all located in Houston, Texas having a total current value of $1.82 million (based on Debtor's opinion). La Monarca Investment Plus Management Group LLC sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Case No. 24-35204) on November 4, 2024. In the petition filed by Perla Gutierrez, as president and managing member, the Debtor reports total assets of $1,821,393 and total liabilities of $382,000. Honorable Bankruptcy Judge Eduardo V. Rodriguez handles the case. The Debtor is represented by: Alex Olmedo Acosta, Esq. ACOSTA LAW P.C. One Northwest Centre Houston TX 77040 Tel: (713) 980-9014 Email: alex@theacostalawfirm.com M. BURTON MARSHALL: Court Tosses O'Dell v. Berkshire Bank Lawsuit ----------------------------------------------------------------- Judge David N. Hurd of the United States District Court for the Northern District of New York granted Berkshire Bank's motion to dismiss the case captioned as MARK S. O'DELL, Individually and on Behalf of All Others Similarly Situated, Plaintiff, -v- BERKSHIRE BANK, a Massachusetts Trust Company, Defendant, Case 5:24-cv-00652-DNH-TWD (N.D.N.Y.). Plaintiff's complaint is dismissed with prejudice. On May 138, 2024, plaintiff Mark S. O'Dell filed this putative class action against Berkshire Bank alleging a single claim of aiding-and-abetting common law fraud. Berkshire has moved to dismiss the complaint pursuant to Federal Rules of Civil Procedure 12(b)(6) and 9(b). This case arises out of O'Dell and the putative class members' loss of significant savings stemming from a pyramid scheme orchestrated and conducted by non-party M. Burton Marshall. For three decades, Marshall operated a series of businesses and owned several properties in Madison County, New York. Marshall's business activities included the preparation of tax returns, self-storage, printing, insurance brokering, property maintenance, and real estate rentals. But Marshall's primary business endeavor was soliciting money to invest in a fund he originated by offering promissory notes; i.e., written documents promising to repay investors a guaranteed eight percent annual return. Marshall solicited friends, neighbors, and clients to invest in the Marshall Fund. Marshall paid investors their promised returns and raised new funds by soliciting new investors. Marshall operated the Fund with a single personal checking account that he maintained at Berkshire. Deposits from new investors were credited to this account and distributions to existing investors were debited from it. In other words, Marshall was running a textbook Ponzi scheme. On April 20, 2023, after running into trouble with his sham business operation when he became ill and required hospitalization, Marshall filed a Petition for relief under Chapter 11 of the Bankruptcy Code. Marshall's inability to solicit new investors during this time crippled the Ponzi scheme. At that time, the Marshall Fund owed approximately 900 Notes to investors valued at over $90 million. Believing that Marshall's investors will never receive full restitution from the Bankruptcy Action, O'Dell's class action lawsuit followed. To survive a Rule 12(b)(6) motion to dismiss, the complaint's factual allegations must be enough to elevate the plaintiffs right to relief above the speculative level. The requisite "strong inference" of fraud can be demonstrated "either (a) by alleging facts to show that defendants had both motive and opportunity to commit fraud, or (b) by alleging facts that constitute strong circumstantial evidence of conscious misbehavior or recklessness." To prove that defendant aided and abetted the fraud, plaintiff must also show the defendant provided substantial assistance to advance the fraud's commission. Berkshire argues that O'Dell has failed to state a plausible claim for aiding and abetting fraud because plaintiff has failed to: (1) plead facts giving rise to a "strong inference" that Berkshire possessed "actual knowledge" of Marshall's Ponzi scheme; and (2) plausibly allege that defendant "substantially assisted" Marshall with the fraud. Plaintiff argues in opposition that Berkshire had actual knowledge for several reasons. First, Marshall's Berkshire Account was the largest and most transactionally active account at Berkshire's Oriskany Falls branch prior to the branch's shutdown in 2021. Second, and relatedly, Berkshire had legal and compliance requirements which should have required a heightened degree of diligence and scrutiny into high volume clients such as Marshall. In plaintiffs view, these requirements should have alerted defendant's personnel to the unusual nature of Marshall's business activities. Third, Berkshire had "know your customer" requirements and Anti-Money Laundering obligations, as well as their own compliance procedures, to familiarize themselves with and monitor the daily activity of their customers. Plaintiff argues that because Marshall was a prominent member of the community with whom bank employees were familiar, he should have been flagged by the bank on numerous occasions for his fraudulent activity. In spite of this, plaintiff contends the Bank took no steps to stop Marshall's fraudulent scheme and instead continued to provide him with banking services. In sum, O'Dell contends that because of these requirements, Berkshire had a duty to understand the nature of Marshall's business and his bank transactions. According to plaintiff, Berkshire actually discovered Marshall was conducting his fraudulent Ponzi scheme through his account by virtue of these due diligence responsibilities. Upon review, Berkshire's motion to dismiss will be granted, the Court holds. The Court finds Plaintiff has not alleged facts that support a plausible inference that Berkshire possessed "actual knowledge" of Marshall's Ponzi scheme or that Berkshire "substantially assisted" in Marshall's orchestration or operation of the Ponzi scheme. A copy of the Court's decision is available at https://urlcurt.com/u?l=FqpATq About M. Burton Marshall M. Burton Marshall sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D.N.Y. Case No. 23-60263) on April 20, 2023. Judge Robert E. Littlefield, Jr. oversees the case. Barclay Damon, LLP is the Debtor's legal counsel. MARTINEZ PALLET: Gets OK to Use Cash Collateral Thru. Dec 31 ------------------------------------------------------------ The U.S. Bankruptcy Court for the Eastern District of California granted Martinez Pallet Services, Inc. to continue using cash collateral through December 31, 2024. This authorization allows the Debtor in Possession to cover essential expenses and make adequate protection payments as outlined in the cash collateral budget. Total monthly operating expenses is $30,102. The court has ordered the Debtor to make monthly adequate protection payments of $20,000 to First Chatham Bank and $1,000 to Balboa Capital. These payments are intended to provide adequate protection to the creditors with an interest in the cash collateral. Creditors with an interest in the cash collateral have been granted replacement liens on post-petition proceeds. This provision ensures that the creditors' interests are protected and that they will have a secured claim against the Debtor's post-petition assets. The next hearing is scheduled for December 12, 2024. About Martinez Pallet Services Martinez Pallet Services, Inc. is a pallet supplier in Turlock, Calif. The Debtor filed a petition under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. E.D. Calif. Case No. 24-90343) on June 21, 2024, with up to $50,000 in assets and up to $10 million in liabilities. Francisco Mora Martinez, president, signed the petition. Judge Ronald H. Sargis presides over the case. Gabriel E. Liberman, Esq., at the Law Offices of Gabriel Liberman, APC represents the Debtor as legal counsel. MAXIMUS SUPPLY: Gets Interim OK to Use Cash Collateral Thru Jan. 16 ------------------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Indiana, Hammond Division at Lafayette granted Maximus Supply Chain Holdings, LLC, and its affiliates authorization to use cash collateral for operating expenses on an interim basis. The court has approved the use of cash collateral in accordance with the budget attached to the order as Exhibit A, with a permitted aggregate variance of not greater than 10% on a monthly basis. The Debtors 13-week cash forecast shows anticipated total expenses of $4,054,063. The court has scheduled a status conference for January 16, 2024, at 11:00 a.m. to discuss continued cash use. The conference will be held in Room 2127, Federal Building, 1300 S. Harrison Street, Fort Wayne, Indiana, and remote participation instructions can be found on the court's website. The next hearing is scheduled for January 16, 2025, at 11:00 AM in Fort Wayne, Indiana. About Maximus Supply Chain Holdings Maximus develops innovative solutions and products servicing a variety of industries including automotive, commercial vehicle, agricultural equipment, RVs, and power manufacturing industries. Maximus Supply Chain Holdings, LLC and its affiliates filed their voluntary petitions for Chapter 11 protection (Bankr. N.D. Ind. Lead Case No. 24-40167) on June 25, 2024, listing as much as $0 in both assets and liabilities. Sam Bazzi, president/CEO, signed the petitions. Judge Robert E. Grant oversees the cases. Boyer & Boyer serves as the Debtors' legal counsel. Stretto, Inc. is the Debtors' claims and noticing agent. MEDICAL PROPERTIES: Aims to Take Over 3 California Entities ----------------------------------------------------------- Reshmi Basu and Steven Church of Bloomberg News reports that Medical Properties Trust Inc. (MPT), a leading U.S. hospital landlord, has taken steps to assume control of three Southern California healthcare entities, accusing their owner, Prospect Medical Holdings, of failing to meet its debt obligations. In a letter dated November 18, 2024 and reviewed by Bloomberg News, MPT called for the resignation of board members from the three entities, proposing their replacement with independent managers selected by MPT. The company also cautioned Prospect that it may proceed with foreclosure on the properties if the debt default remains unresolved, the report states. About Medical Properties Trust Medical Properties Trust, Inc. -- http://www.medicalpropertiestrust.com/-- is a self-advised real estate investment trust formed in 2003 to acquire and develop net-leased hospital facilities. From its inception in Birmingham, Alabama, the Company has grown to become one of the world's largest owners of hospital real estate with 444 facilities and approximately 45,000 licensed beds in ten countries and across four continents. MMA LAW FIRM: Morris Bart Not Entitled to Jury Trial, Court Rules ----------------------------------------------------------------- In the case captioned as MMA LAW FIRM, PLLC, Plaintiff, VS. MORRIS BART, LLC, Defendant, ADVERSARY NO. 24-3127 (Bankr. S.D. Tex.), Chief Judge Eduardo V. Rodriguez of the United States Bankruptcy Court for the Southern District of Texas granted Debtor's Motion to Strike Morris Bart, LLC's Jury Demand. On June 24, 2024, MMA initiated the instant adversary proceeding. On July 29, 2024, MMA filed its Amended Complaint. On August 12, 2024, Morris Bart, LLC filed its "Defendant's Motion To Dismiss First Amended Complaint Pursuant To Fed. R. Civ. P. 12(b)(1), (6), And (7) And Alternative Motion To Transfer Venue Pursuant To 28 U.S.C. Secs. 1404(a) And 1412". On September 9, 2024, Bart filed its "Defendant's Notice of Jury Demand." On October 4, 2024, MMA filed the instant Motion to Strike. On October 23, 2024, Bart filed its "Defendant's Response To Motion To Strike Jury Demand". In its Complaint, MMA brings three causes of actions: (1) violation of the automatic stay by Bart; (2) declaratory judgment pursuant to 11 U.S.C. Sec. 541 affirming that MMA's interest in attorney fees pursuant to certain contingency fee contracts are property of the bankruptcy estate; and (3) turnover of such fees received by Bart, which MMA alleges are at least partly property of the estate, pursuant to Sec. 542(a). According to the Court, as to the Automatic Stay Violation Claim, "it is well established that an action to enforce the automatic stay under 11 U.S.C. Sec. 362(a) does not give rise to a jury trial right." A claim for attorney fees to enforce the automatic stay, although a monetary remedy, is equitable in nature and does not give rise to a jury trial right. Therefore, there is no jury trial right for the Automatic Stay Violation Claim, the Court finds. As to the Turnover Claim, most courts agree that because a turnover action is equitable in nature and seeks an equitable remedy, there is no constitutional Seventh Amendment right to a jury trial when the turnover of estate property is sought. Bart asserts that since the Turnover Claim seeks a monetary award, it is legal in nature. However, the monetary nature of a remedy does not require a finding that an action is legal in nature, the Court notes. A turnover action is not an action to recover damages for the taking of estate property but an action to recover possession of property belonging to the estate at the time of the filing. It invokes the court's most basic equitable powers to gather and manage property of the estate. Therefore, the Turnover Claim does not give rise to a jury trial right, the Court finds. The Court points out as to the Declaratory Judgement Claim, the Constitutional right to trial by jury cannot be made to depend upon the choice of words used in a pleading. In determining whether a claim for declaratory judgment involves a demand in law or equity, the court must examine how the claim would have arisen had it not been raised in a declaratory judgment action. Declaratory relief may be legal or equitable depending on the basic nature of the underlying issues and the remedy sought. The Declaratory Judgement Claim seeks a determination of the estate's interest in property, specifically the fees from contingency fee contracts, which is based on the equitable claim of a turnover action. The declaratory relief in this case sounds in equity and there is no jury trial right behind the Declaratory Judgement Claim, the Court finds. Accordingly, Bart is not entitled to a jury trial, the Court concludes. A copy of the Court's decision is available at https://urlcurt.com/u?l=jDxEMM About MMA Law Firm MMA Law Firm, PLLC is a Houston-based law firm specializing in insurance claim management, negotiation and litigation. MMA Law Firm filed Chapter 11 petition (Bankr. S.D. Texas Case No. 24-31596) on April 9, 2024, with $100 million to $500 million in assets and $10 million to $50 million in liabilities. Zach Moseley, managing member, signed the petition. Judge Eduardo V. Rodriguez oversees the case. The Debtor is represented by Johnie Patterson, Esq., at Walker & Patterson, P.C. MOJ REALTY: Court OKs Mobile Home Park Sale for $1.6MM ------------------------------------------------------ The U.S. Bankruptcy Court for the Middle District of Florida, Tampa Division, has granted authority to MOJ Realty LLC to sell its mobile home park located at 1610 Florida Highway 60, Valrico, Florida. The Debtor is authorized to sell the property to Yazan Musa for a cash price of $1,600,000. The sale of the Property will be free and clear of liens since the sale price will exceed the total of all bona fide allowed secured claims relating to the Property, and said secured creditors could be compelled, in a legal or equitable proceeding, to accept a money satisfaction of such interest. The buyer is authorized to distribute the net proceeds of the sale, after payment of normal closing costs to: -- First Mortgage-2JEC with $1,430,000.00 -- Real Estate Taxes - Hillsborough County with $38,605.83 -- Commission to Broker with $48,000.00 -- Administrative expenses with $27,780.00 -- US Trustee Fees (estimated-based on disbursements -- Balance to unsecured creditors – prorata with $13,600 The Court grants that the sale of the Property shall not be subject to any document recording tax, stamp tax, conveyance fee, intangibles or similar tax, mortgage tax, real estate transfer tax, mortgage recording tax, or other similar or governmental assessment. About MOJ Realty LLC MOJ Realty, LLC, a Single Asset Real Estate, operates a mobile home park in Valrico, Florida. MOJ Realty filed a Chapter 11 bankruptcy petition (Bankr. M.D. Fla. Case No. 23-01259) on March 31, 2023. In the petition signed by William A. Guzman, managing member, the Debtor disclosed $500,000 to $1 million in assets and $1 million to $10 million in liabilities. Judge Catherine Peek McEwen presides over the case. The Law Office of Leon A. Williamson, Jr., PA serves as the Debtor's counsel. MURRAY ENERGY: Malpractice Claim v. Dinsmore & Shohl, et al. Tossed ------------------------------------------------------------------- Judge John E. Hoffman, Jr. of the United States Bankruptcy Court for the Southern District of Ohio granted the defendants' motion to dismiss the adversary proceeding captioned as Brenda L. Murray, et al., Plaintiffs, v. Dinsmore & Shohl, LLP et al., Defendants, Adv. Pro. No. 24-2028 (Bankr. S.D. Ohio). This adversary proceeding arises in the Chapter 11 cases of Murray Energy Holdings Co. and its affiliated debtors and debtors in possession. The complaint in this adversary proceeding was first filed in the Belmont County, Ohio Court of Common Pleas. The plaintiffs in this case include Brenda L. Murray, the widow of the Debtors' founder, Robert E. Murray, who died in October 2020. Mrs. Murray is a Plaintiff on her own behalf and in her capacities as executrix of Mr. Murray's estate and trustee of the Brenda L. Murray Trust. The other Plaintiff is Michael J. Shaheen, in his capacity as trustee of the Robert E. Murray Trust. The State Court complaint alleges that the defendants -- Dinsmore & Shohl LLP and three of its current or former partners, Jerrad T. Howard, J. Michael Cooney and Kim Martin Lewis -- engaged in legal malpractice. The Defendants removed the State Court complaint to the Bankruptcy Court under 28 U.S.C. Sec. 1452(a), which provides for the removal of actions over which bankruptcy courts have jurisdiction under 28 U.S.C. Sec. 1334, and Rule 9027 of the Federal Rules of Bankruptcy Procedure. The plaintiffs allege that in negotiating and seeking confirmation of the Debtors' second amended Chapter 11 plan the defendants: (1) exposed the plaintiffs to billions of dollars of liability, and (2) failed to advise the plaintiffs on how to protect themselves from that liability. The plaintiffs filed an amended complaint in response to the defendants' initial motion to dismiss this adversary proceeding. Before the Court now is the defendants' motion to dismiss this adversary proceeding under Rule 12(b)(6) of the Federal Rules of Civil Procedure for failure to state a claim upon which relief can be granted. In their Dismissal Motion, the Defendants contend that the Malpractice Claim should be dismissed under Rule 12(b)(6) for three reasons: (1) because it is barred by the Exculpation Clause and Release, (2) because the Plaintiffs fail to adequately plead causation, and (3) because the Malpractice Claim is barred by the Fee Application Order. The Defendants argue that they are Exculpated Parties under the Chapter 11 Plan because they are being sued in their capacity as counsel to the Debtors. The Malpractice Claim also falls within the scope of the Exculpation Clause, the Bankruptcy Court notes. According to the Bankruptcy Court, the Amended Complaint makes abundantly clear that the Plaintiffs are suing the Defendants based on their negotiation of the Plan and other Plan-related efforts. The Bankruptcy Court finds the Exculpation Clause applies in this case because the Plaintiffs' Malpractice Claim is at least related to any act or omission based on the Chapter 11 Plan's negotiation. Because the Defendants are Exculpated Parties, any liability they may have had on the Malpractice Claim is subject to the Exculpation Clause, and the Amended Complaint therefore must be dismissed, the Bankruptcy Court concludes. The Release also bars the Malpractice Claim, the Bankruptcy Court finds. According to the Bankruptcy Court, it releases Dinsmore from claims "relating to" the Debtors, the Chapter 11 Plan, or the pursuit of Confirmation. The Plaintiffs also contend that applicable state law—the law of New York—governs the interpretation of the Chapter 11 Plan. And they argue that under New York law, releases and exculpation clauses are "strictly construed against the party seeking exemption from liability," must be "expressed in unmistakable language," and, unless so expressed, "will not be deemed to insulate a party from liability for his own negligent acts." Even if all that is true, none of it leads to the Plaintiffs' conclusion that New York law makes the Exculpation Clause and Release inapplicable to the Malpractice Claim, the Bankruptcy Court finds. At the very least, the Malpractice Claim is a claim arising pursuant to a theory of law and is thus a Cause of Action within the meaning of the Exculpation Clause. The Malpractice Claim also clearly is a claim that the Plaintiffs would have been legally entitled to assert within the meaning of the Release. Although the Exculpation Clause and the Release both contain exceptions for "actual fraud, willful misconduct, or gross negligence," those exceptions do not apply to the Malpractice Claim, the Bankruptcy Court states. As the Defendants say, the complaint does not mention 'actual fraud,' so that is no basis for an exception. Also, the Plaintiffs fail to plausibly allege willful misconduct or gross negligence that would bring the Defendants' conduct outside the scope of the Exculpation Clause and the Release, the Bankruptcy Court finds. The Defendants also move to dismiss this adversary proceeding on the ground that the Plaintiffs failed to adequately plead proximate causation -- one of the elements of a malpractice claim. The Bankruptcy Court holds that the Plaintiffs' purported failure to plead proximate cause does not provide a basis for dismissal. Because the Amended Complaint fails to state a claim upon which relief can be granted, the Dismissal Motion is granted, and the Amended Complaint is dismissed with prejudice. A copy of the Court's decision is available at https://urlcurt.com/u?l=4KGiCF About Murray Energy Headquartered in St. Clairsville, Ohio, Murray Energy -- http://murrayenergycorp.com/-- is the largest privately owned coal company in the United States, producing approximately 76 million tons of high-quality bituminous coal each year, and employing nearly 7,000 people in the United States, Colombia and South America. Murray Energy now operates 15 active mines in five regions in the United States, plus two mines in Colombia, South America. It operates 12 underground longwall mining systems, 42 continuous mining units, 10 transloading facilities, and five mining equipment factory and fabrication facilities. Murray Energy and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Ohio Lead Case No. 19-56885) on Oct. 29, 2019. At the time of the filing, the Debtors disclosed assets of between $1 billion and $10 billion and liabilities of the same range. The cases have been assigned to Judge John E. Hoffman Jr. The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis International LLP as general bankruptcy counsel; Dinsmore & Shohl LLP as local counsel; Evercore Group L.L.C. as investment banker; Alvarez and Marsal L.L.C. as financial advisor; and Prime Clerk LLC as notice and claims agent. The U.S. Trustee for Region 9 appointed creditors to serve on the official committee of unsecured creditors on Nov. 7, 2019. The committee tapped Morrison & Foerster LLP as legal counsel; AlixPartners, LLP as financial advisor; and Vorys, Sater, Seymour and Pease LLP as local counsel. ONYX SITE: Court OKs Barber Greene Property Sale ------------------------------------------------ The U.S. Bankruptcy Court for the Middle District of Florida, Jacksonville Division, has granted Onyx Site Services LLC to sell its Barber Greene asphalt plant, free and clear of liens, claims, encumbrances, and interests. The Debtor is a construction site developer that concentrates on full site development, including but not limited to site development for road construction, sidewalks, curbs, and underground utilities. It also describes itself as a site-ready development contractor who customarily operates a general contractor on significant projects. The Debtor wants to sell its Barber Greene asphalt plant and submits that the sale is the highest and best offer expected to be received based on the portion of the appraisal that sets forth the value of the Property. Pursuant to the appraisal, the value of the Property is $315,000. The Debtor is authorized to sell the Barber Greene Asphalt Plant to Viale Industries, LLC, and to execute and deliver documents and perform all things necessary to effectuate the sale. Upon the sale closing, the sale proceeds, in the amount of $315,000.00 shall be deposited into the trust account of Aaron Cohen, Subchapter V Trustee and held pending further order of the Court. The Court also held that the Debtor shall promptly file notice with the Court in the event there is any disruption or rescheduling of the sale such that the sale will not close by the proposed closing date of November 20, 2024. About Onyx Site Services LLC Onyx Site Services is a a construction site developer that concentrates on full site development, including but not limited to site development for road construction, sidewalks, curbs, and underground utilities headquartered in Palatka, Florida. Onyx Site Services, sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. M.D. Fla. Case No. 24-01656) on June 11, 2024, with up to $50,000 in assets and up to $10 million in liabilities. The petition was signed by Joseph A. Silas as managing member. Judge Jacob A. Brown presides over the case. Robert C. Bruner, Esq., at Bruner Wright, P.A. serves as the legal counsel of the Debtor PLAY DAY: Gets Interim OK to Use Cash Collateral Thru Jan. 31 ------------------------------------------------------------- Play Day Cafe, LLC received interim approval from the U.S. Bankruptcy Court for the Northern District of Ohio to use cash collateral. The Debtor is authorized to use cash collateral from November 1, 2024, through January 31, 2025. The usage will follow the approved cash collateral budget (Exhibit A). As a adequate protection payments Huntington is entitled to receive $2,000 in adequate protection payments for its collateral during the Interim Period. Secured creditors Huntington, SBA, and Capital Solutions are granted Replacement Liens in their prepetition collateral to protect their interests. These liens are deemed automatically perfected without further action required. The Replacement Liens exclude certain bankruptcy causes of action, such as those under sections 544, 547, 548, etc. The Debtor may use cash collateral to pay professional fees, including those of the Debtor’s counsel and a Subchapter V trustee. The next hearing is set for January 21, 2025. Any objections to the use of cash collateral must be filed by January 14, 2025. About Play Day Cafe LLC Play Day Cafe LLC is a privately held company that owns and operates a recreational facility featuring a mega-sized playground, a cafe with healthy eating choices and party rooms to host birthday parties and other group events. Play Day Cafe LLC sought relief under Subchapter V of Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Ohio Case No. 24-51063) on July 16, 2024. In the petition signed by Barbara A. Riles, member, the Debtor reports total assets of $50,225 and total liabilities of $1,145,222. Judge Alan M. Koschik oversees the case. Steven J. Heimberger, Esq., at Roderick Linton Belfance, LLP represents the Debtor as legal counsel. PROVISION BREAD: Court Approves to Use Cash Collateral for Retainer ------------------------------------------------------------------- The United States Bankruptcy Court for the District of Colorado has granted Provision Bread & Baker LLC authority to Use Cash Collateral. This motion seeks authorization for the Debtor to pay the Subchapter V Trustee retainer using cash collateral. The Debtor is authorized to use cash collateral to pay the trustee retainer in the amount of $2,500. The payment is consistent with the Interim Order Authorizing Use of Cash Collateral and does not violate its terms. The Court grants any additional relief it deems necessary for the case. About Provision Bread & Bakery Provision Bread & Bakery, LLC filed a petition under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. D. Colo. Case No. 24-14823) on Aug. 19, 2024, with as much as $1 million in both assets and liabilities. Judge Michael E. Romero oversees the case. Aaron A. Garber, Esq., at Wadsworth Garber Warner Conrardy, PC serves as the Debtor's legal counsel. ROCKVILLE CENTRE DIOCESE: Court OKs $88MM Insurance Deal -------------------------------------------------------- Rick Archer of Law360 Bankruptcy Authority reports that a New York bankruptcy judge on November 18, 2024, approved an $88 million insurance settlement for the Roman Catholic Diocese of Long Island, ensuring that sexual abuse claimants who forgo payouts under the diocese's Chapter 11 plan retain the option to file their own insurance claims. About The Roman Catholic Diocese of Rockville Centre, New York The Roman Catholic Diocese of Rockville Centre, New York, is the seat of the Roman Catholic Church on Long Island. The Diocese has been under the leadership of Bishop John O. Barres since February 2017. The State of New York established the Diocese as a religious corporation in 1958. The Diocese is one of eight Catholic dioceses in New York, including the Archdiocese of New York. The Diocese's total Catholic population is approximately 1.4 million, roughly half of Long Island's total population of 3.0 million. The Diocese is the eighth largest diocese in the United States when measured by the number of baptized Catholics. To deal with sexual abuse claims, the Roman Catholic Diocese of Rockville Centre, New York, filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 20-12345) on Sept. 30, 2020, listing as much as $500 million in both assets and liabilities. Judge Martin Glenn oversees the case. The Diocese tapped Jones Day as legal counsel, Alvarez & Marsal North America, LLC, as restructuring advisor, and Sitrick and Company, Inc., as communications consultant. Epiq Corporate Restructuring, LLC is the claims agent. The U.S. Trustee for Region 2 appointed an official committee of unsecured creditors in the Diocese's Chapter 11 case. The committee tapped Pachulski Stang Ziehl & Jones, LLP and Ruskin Moscou Faltischek, PC as its bankruptcy counsel and special real estate counsel, respectively. Robert E. Gerber, the legal representative for future claimants of the Diocese, is represented by the law firm of Joseph Hage Aaronson, LLC. SEELOS THERAPEUTICS: Seeks Chapter 11 After Nasdaq Delisting ------------------------------------------------------------- Hilary Russ of Law360 reports that Seelos Therapeutics Inc., a publicly traded biopharmaceutical company, filed for Chapter 11 bankruptcy in New York on Saturday, reporting estimated liabilities ranging from $10 million to $50 million. About Seelos Therapeutics Inc. Seelos Therapeutics Inc., a publicly traded biopharmaceutical company Seelos Therapeutics Inc. sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 24-11987) on November 16, 2024. In its petition, the Debtor reports estimated liabilities between $10 million and $50 million. The Debtor is represented by: Gabriel Del Virginia, Esq. Law Offices of Gabriel Del Virginia 30 Wall Street, 12th Floor New York, NY 10005 P: 212-371-5478 Fax: 212-371-0460 SEYED MUSTAFA MAGHLOUBI: Court Orders Coercive Incarceration ------------------------------------------------------------ Chief Judge Neil W. Bason of the United States Bankruptcy Court for the Central District of California concluded that coercive incarceration is necessary to secure Seyed Mustafa Maghloubi's compliance with the Court's orders in his Chapter 11 bankruptcy case. On December 11, 2023, the Court issued an order directing the Debtor to appear and show cause why the Court should not impose sanctions and/or direct the appointment of a chapter 11 trustee. The Court has conducted ten hearings on the Initial OSC and subsequent OSCs, including four evidentiary hearings. Unfortunately, although Mr. Maghloubi has been provided multiple opportunities over a period of approximately eleven months to comply with his obligations under the Court's orders and under the Bankruptcy Code, he has chosen not to do so, the Court recounts. The Court is reluctantly forced to find and conclude that coercive incarceration is necessary to compel Mr. Maghloubi's compliance with those obligations. The Court finds and concludes that Mr. Maghloubi continues to be in violation of its orders -- both written orders tailored to the particular circumstances of this case, such as the First and Second Contempt Order, and "deemed orders" imposing upon Mr. Maghloubi various obligations under the Bankruptcy Code. Notwithstanding the ample time and multiple opportunities that Mr. Maghloubi has been provided to rectify the situation, he remains in contempt of court. A separate judgment and commitment order will be issued directing Mr. Maghloubi to surrender himself to the U.S. Marshal's Service to be detained in the custody of the Bureau of Prisons. A copy of the Court's decision is available at https://urlcurt.com/u?l=x4p4Gi Seyed Mustafa Maghloubi filed for Chapter 11 bankruptcy protection (Bankr. C.D. Calif. Case No. 2:23-bk-13307-NB) on May 30, 2023. Judge Neil W. Bason oversees the case. SHERATON CRESCENT: Faces Uncertainty After Failing to Secure Buyer ------------------------------------------------------------------ Jeremy Duda of Axios Phoenix reports that the sale of the Sheraton Phoenix Crescent, located near the future redevelopment site of Metrocenter Mall, remains stalled after a second auction failed to secure a buyer. The hotel, closed for nearly two years due to an electrical fire, is currently under court-ordered receivership, the report relates. This process assigns control of the property to a neutral third party to manage operations and help creditors recover debts, the report adds. An initial auction planned for late September 2024 was postponed by GF Hotels and Resorts, the appointed receiver, to allow additional time for marketing the property and attracting offers, according to court filings. A second auction on November 6, 2024 drew interest from about five bidders. However, none met the lenders' minimum bid requirements, said Gerald Shelley, an attorney representing Stok Investment Group, one of the bidders. "There's a clear disconnect between what lenders think the property is worth and what the market is willing to pay," Shelley told Axios. Maricopa County Superior Court Judge Dewain Fox had authorized the receiver to cancel or delay the auction if bids were insufficient to cover the property's liens or if the plaintiff consented. Shelley added, "Further negotiations may happen, and adjustments could be made. Ultimately, the property will sell, and we’re still interested in acquiring it." A status conference is scheduled for February 12, 2025 to determine how the process will proceed. Stok Investment Group was under contract to purchase the hotel before it entered receivership. Shelley confirmed that Stok remains under contract and would pursue a share of the proceeds if the property is sold to another buyer. Previously, Stok had explored plans for an adaptive reuse project at the hotel and remains committed to redeveloping the property. About Sheraton Phoenix Crescent Sheraton Phoenix Crescent is a 3-star hotel in Phoenix, Arizona. SHERMAN/GRAYSON: PCO Reports No Change in Patient Care Quality -------------------------------------------------------------- Daniel McMurray, the court-appointed patient care ombudsman, filed his sixth report regarding the quality of patient care provided by Sherman/Grayson Hospital, LLC. The report covers the period from August 28 to October 26. The ombudsman conducted a facility visit from September 24 to September 26, at Wilson N. Jones Regional Medical Center to review the current operational status of the hospital and its programs. In connection with or in addition to the site visit, the ombudsman conducted interviews with staff and reviewed various materials to maintain a current understanding of the issues and challenges impacting the operations and potentially the quality of care delivered, including matters and issues presented in the bankruptcy process or noted in the public domain. The ombudsman claimed that the hospital has not experienced any significant shortages of supplies or materials. However, he remains concerned about the possible impact on hospital operations of invoices unpaid as a result of the Change Healthcare cyberattack. The cyberattack experienced by Chane Healthcare as well as the installation of the new IT system continue to have negative impact on the facility's cash flow. Mr. McMurray observed no evidence of deferred maintenance. The facility continues to be well maintained and both neat and clean. The ombudsman identified no inappropriate storage or neglected areas. Even with the decreased census, no facility issues were identified during this reporting period. Mr. McMurray noted that the hospital purchased a new electronic health record and operational management system, which has been installed. This approach is working quite well, although it is slightly more cumbersome than a fully electronic process. The ombudsman in his sampling, interviews with providers, and observations finds no significant negative impact on the quality of care provided. The ombudsman found that facilities and grounds of the hospital continue to be well kept and maintained. As part of the tours conducted by the ombudsman during this site visit, specific review of fire safety compliance was conducted. Fire Safety, material storage and disposal of hazardous materials demonstrate a safe environment for the delivery of care. A copy of the ombudsman report is available for free at https://urlcurt.com/u?l=aXi8x5 from PacerMonitor.com. About Sherman/Grayson Hospital Sherman/Grayson Hospital, LLC is the operator of Wilson N. Jones Regional Medical Center, a 207-bed acute care hospital in Sherman, Texas. Sherman/Grayson Hospital sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Case No. 23-10810) on June 23, 2023, with $1 million to $10 million in assets and $50 million to $100 million in liabilities. Judge J. Kate Stickles oversees the case. Leonard M. Shulman, Esq., at Shulman Bastian Friedman & Bui, LLP and Rosner Law Group, LLC serve as the Debtor's bankruptcy counsel and Delaware counsel, respectively. The U.S. Trustee for Region 3 appointed an official committee to represent unsecured creditors in the Debtor's Chapter 11 case. The committee tapped Potter Anderson & Corroon, LLP and RK Consultants, LLC as legal counsel and financial advisor. Daniel T. McMurray is the patient care ombudsman appointed in the Debtor's Chapter 11 case. SKYLOCK INDUSTRIES: Seeks to Sell Machine, Equipment in Auction --------------------------------------------------------------- Skylock Industries Inc. seeks permission from the U.S. Bankruptcy Court for the Central District of California, Los Angeles Division, to sell machine and equipment, free and clear of liens, claims, and encumbrances. The Debtor employs Onyx Asset Advisors, LLC, and Rabin Worldwide, Inc., as sales agents to market and sell selected machinery and equipment that are located at its production facility at 1290 W Optical Drive, Azusa, CA, and a nearby third party storage facility located at 16105 Avenida Padilla, Azusa, CA. The Debtor manufactures superior quality operating hardware for both commercial and military applications. Boeing's highly publicized issues, Covid-19 disruptions, and the aggressive lender who foreclosed an Optical Drive, have affected the Debtor's operation. The Debtor proposes to sell machinery and equipment that is no longer using in its manufacturing business. Some of the assets are stored in a building that the Debtor used for storage only located at 1716 Avenue Padilla, Irwindale, California, whose monthly rent obligation is s $16,000 per month. The assets are encumbered to the U.S. Small Business Administration and Adhara Aerospace and Defense. As part of the agreement with the Debtor, the sales agent will partner to conduct an omnichannel marketing campaign to promote the sale of assets at Skylock Industries and will target CNC and machine tool professionals via industry specific publications, direct email marketing, digital placements and print advertising. The Sale Agents have a pool of dedicated past buyers in this sector who will be targeted with multiple email reminders. Bidspotter is the largest industrial auction platform and a full dedicated campaign will be sent to reach their vast list of active buyers. The Debtor proposes distribution of the sale proceeds to: -- Estimated Gross Sale Proceeds is $500,000 -- Sale Agents Costs $30,000 -- Post-Petition Rent to Padilla Property (October - December, 2024 to the extent not paid) $272,000 -- Remainder of proceeds to be used by the Debtor in accordance with its approved cash collateral budget The Debtor asserts that proposed distribution reflects a balance between paying down its secured obligations and retaining cash so that it may us the cash in accordance with its approved cash collateral budget and continue to create value for its creditors. About Skylock Industries Inc. Skylock Industries Inc. is a California-based aircraft parts manufacturer. Skylock Industries sought relief under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Calif. Case No. 24-17820) on Sept. 26, 2024, with $10 million to $50 million in both assets and liabilities. Judge Sheri Bluebond handles the case. The Debtor is represented by Jeffrey S. Shinbrot, Esq., at The Shinbrot Firm. SMITH HEALTH CARE: Seeks Bankruptcy Protection in Pennsylvania -------------------------------------------------------------- On November 7, 2024, Smith Health Care Ltd. filed Chapter 11 protection in the Middle District of Pennsylvania. According to court filing, the Debtor reports between $1 million and $10 million in debt owed to 1 and 49 creditors. The petition states funds will be available to unsecured creditors. A meeting of creditors under Sec. 341(a) to be held on December 12, 2024 at 2:30 PM. About Smith Health Care Ltd. Smith Health Care Ltd., formerly known as mith Nursing and Convalescent Home of Mountain Top, Inc., provides inpatient nursing and rehabilitative services to patients who require continuous health care. Smith Health Care Ltd. sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. M.D. Pa. Case No. 24-02892) on November 7, 2024. In the petition filed by Donna Strittmatter, as president, the Debtor reports estimated assets and liabilities between $1 million and $10 million each. Honorable Bankruptcy Judge Mark J. Conway handles the case. The Debtor is represented by: Robert E. Chernicoff, Esq. CUNNINGHAM, CHERNICOFF & WARSHAWSKY PC 2320 N. Second St. Harrisburg, PA 17110 Tel: (717) 238-6570 SOLDIER OPERATING: Affiliate Seeks to Sell Movable Equipment ------------------------------------------------------------ Viceroy Petroleum, LP and its affiliate, Soldier Operating, LLC, seek permission from the U.S. Bankruptcy Court for the Western District of Louisiana, Lafayette Division, to sell certain nonessential equipment. The Debtor owns certain interests in oil, gas and/or mineral leases, subleases, leasehold and contractual rights in mineral interests, and other leasehold interests related to State Lease No. 340, Cote Blanche Island Field, St. Mary Parish, Louisiana. The Debtor has identified certain movable equipment as being unnecessary to an effective reorganization and desires to sell such equipment. The Debtor engages Texas Well Consulting as its equipment broker to handle marketing and negotiate the sales of the various equipment. It also proposes to satisfy any commissions earned by Texas Well Consulting from its receipt of proceeds of individual sales, immediately upon its receipt of the proceeds. The Debtor seeks to satisfy other obligations from the sale proceeds, specifically, the 2017 JLG Telehandler Forklift, which is subject to a first lien held by Citizens National Bank in the amount of $25,450.63. The Debtor believes the remaining Equipment is not subject to any specific vendor lien or purchase money security interest. However, the remaining Equipment may be subject to an "all equipment" lien asserted by MBark Global, LLC. The Debtor asks to pay to MBark all post-commission proceeds from the Equipment sales, except for those proceeds generated by the sale of Citizens collateral and which are necessary to satisfy the Citizens secured claim. The Debtor suggests that good cause exists for the proposed sales and requests authority to sell and transmit the proceeds of the sales as outlined in this Motion. The Debtor further suggests that given its liquidity position, cause exists for waiver of the stay imposed by Bankruptcy Rule 6004(h). The Debtor seeks to sell the Property in a private or public sale, free and clear of all liens, claims, and interests, and the proceeds will be paid to the commissions to Texas Well Consulting, MBark Global, LLC, and Citizens National Bank. About Soldier Operating, LLC Soldier Operating, LLC and Viceroy Petroleum, LP filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code (Bankr. W.D. La. Lead Case No. 24-50387) on May 13, 2024. At the time of the filing, Soldier Operating disclosed $5,615,631 in assets and $6,089,722 in liabilities. Viceroy Petroleum owns certain interests in oil, gas and/or mineral leases, subleases, leasehold and contractual rights in mineral interests, and other leasehold interests related to State Lease No. 340, Cote Blanche Island (CBI) field, St. Mary Parish, Louisiana. Judge John W. Kolwe presides over the cases. The Debtors tapped Bradley L. Drell, Esq., at Gold, Weems, Bruser, Sues & Rundell, APLC as legal bankruptcy counsel. Viceroy Petroleum retained Chaffe & Associates, Inc. as investment broker. The U.S. Trustee appointed an official committee of unsecured creditors in these Chapter 11 cases. The committee tapped H. Kent Aguillard, Esq., and Caleb K. Aguillard, Esq., and Stewart Robbins Brown & Altazan, LLC as co-counsel. SPACE SHADOW: Seeks to Sell Henderson Property for $6.1MM --------------------------------------------------------- Space Shadow LLC seeks permission from the U.S. Bankruptcy Court for the District of Nevada to sell its property located at 249 Stephanie Street, Henderson, Nevada for $6,100,000, free and clear of liens. The first mortgage holder of the property is Avatar with a security interest in the amount of $3,850,000. The Debtor intends on selling the property at fair market value with the purchase price of $6,100,000. The Buyer has to deliver $1500,000 into escrow as an earnest money deposit towards the purchase price. The title company handling the closing is Security 1st Title located at 9500 W. Hillwood Drive, Suite 110, Las Vegas, Nevada 89134. The possession will take place at the close of escrow. The close of escrow shall be on or before December 5th, 2024, and or upon court approval of an order. The Seller/Debtor agrees to cooperate with a 1031 exchange. Seller to credit Buyer security deposits and pro-rata rent leasing commission at the close of escrow. There will be no real estate commissions paid out of this transaction. There is no auction contemplated nor any overbids but if someone shows up, there will be no objection by the Debtor. The sale motion will close after the court approval or December 5, 2024 and the sale motion establishes there is a $150,000 earnest money deposit. If the sale is not approved by the court the deposit will be returned. There is no interim management arrangements. The sale proceeds of the sale will be held until the matter is resolved with the mortgage holder and the Debtor and will be allocated accordingly. If any party comes into to court, objects to the sale, and wants to bid in court at the date and time set for the approval of this sale, they must file an objection with the court at the latest 48 hours before the hearing stating they are interested in bidding at the hearing. They are required to bring or provide to court proof of funds. The Debtor requests that the properties be sold free and clear of liens. About Space Shadow LLC Space Shadow LLC in Henderson, NV, has been operating the real property located at 249 N. Stephanie Street, Henderson, Nevada. The Debtor filed its voluntary petition for Chapter 11 protection (Bankr. D. Nev. Case No. 23-14412) on October 9, 2023, listing as much as $1 million to $10 million in both assets and liabilities. Kayvoughn Moradi as managing member, signed the petition. Judge Hilary L. Barnes oversees the case. ANDERSEN & BEEDE serve as the Debtor's legal counsel. STEWARD HEALTH: PCO Files Emergent Supplemental Report ------------------------------------------------------ Susan Goodman, the patient care ombudsman, filed with the U.S. Bankruptcy Court for the Southern District of Texas her emergent supplemental report regarding the quality of patient care provided by Steward Health Care System, LLC and affiliates. The PCO filed the report regarding the Wadley Regional Medical Center in Texarkana, Texas, to report the patient care safety concerns brought to the PCO by WRMC operational teams and physicians about the temporary shutdown and movement of the hospital's hardware storing its digital imaging data. On October 26, the PCO received notice through a departmental director that Steward's corporate office had just provided notice that the companies would be shutting down the Patient Archiving and Communication System (PACS) to move the system to another metropolitan area, just days in advance of the anticipated electronic health record (EHR) data migration planned to occur upon the sale effective date. The PCO claimed that she is troubled by WRMC's image/record transition plan. The PCO, the WRMC hospital operational teams, and most importantly, the physicians and patients, were not provided advance notice of a lengthy, planned PACS take-down. The companies were in control of the PACS take down notice timing yet used this lack of notice as justification to reject what became last minute buyer proposed alternatives aimed at reducing the down time that was concerning to clinicians. The PCO is grateful that the operational team quickly pivoted to cancel patient elective procedures and go on EMS divert status, for patient safety reasons. Yet these cancellations did not have to be accomplished on short notice. As anyone who has been a patient is aware, folks take time off from work, family members travel to provide care support for loved ones. Ms. Goodman cited that she takes great umbrage with the companies' suggestion that the physicians "played" PCO on the topic of patient safety concerns. In assessing patient care delivery risk, the PCO has and will continue to defer to the wisdom and experience of licensed physicians regarding potential patient safety concerns associated with reading patient images directly from the imaging equipment. The PCO feels confident that the on-the-ground operational and physician teams have done all they can to minimize patient risks associated with moving the PACS system and its associated take down period, despite the inexcusable short notice. The PCO feels similarly confident that the buyer engaged to offer reasonable, alternative solutions that may have reduced PACS and EHR cut over down-time. A copy of the supplemental report is available for free at https://urlcurt.com/u?l=4iaGa1 from Kroll, claims agent. The ombudsman may be reached at: Susan N. Goodman PIVOT HEALTH LAW, LLC P.O. Box 69734 |Oro Valley, AZ 85737 Ph: 520.744.7061 (message) Email: sgoodman@pivothealthaz.com About Steward Health Care Steward Health Care System, LLC owns and operates the largest private physician-owned for-profit healthcare network in the U.S. Headquartered in Dallas, Texas, Steward's operations include 31 hospitals in eight states, approximately 400 facility locations, 4,500 primary and specialty care physicians, 3,600 staffed beds, and nearly 30,000 employees. Steward Health Care provides care to more than two million patients annually. Steward and 166 affiliated debtors filed Chapter 11 petitions (Bankr. S.D. Texas Lead Case No. 24-90213) on May 6, 2024. Judge Christopher M. Lopez oversees the cases. The Debtors tapped Weil, Gotshal & Manges, LLP as bankruptcy counsel; McDermott Will & Emery as special corporate and regulatory counsel; AlixPartners, LLP as financial advisor and John Castellano of AlixPartners as chief restructuring officer. Lazard Freres & Co. LLC, Leerink Partners LLC, and Cain Brothers, a division of KeyBanc Capital Markets Inc., provide investment banking services to the Debtors. Kroll is the claims agent. Susan N. Goodman is the patient care ombudsman appointed in the Debtors' cases. SWITCHBACK COFFEE: Court Allows to Use Cash Collateral ------------------------------------------------------ The United States Bankruptcy Court for the District of Colorado has granted Switchback Coffee Roasters, Inc.'s motion to use cash collateral. The Debtor is authorized to use cash collateral to pay the trustee retainer in the amount of $2,500. The payment is in accordance with the previously entered Final Order Authorizing Use of Cash Collateral and does not violate any provisions of that order. The court grants any additional relief it deems necessary for the case. About Switchback Coffee Roasters Switchback Coffee Roasters, Inc. filed a petition under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. D. Colo. Case No. 24-14822) on Aug. 19, 2024, with as much as $1 million in both assets and liabilities. Judge Thomas B. McNamara oversees the case. Aaron A. Garber, Esq., at Wadsworth Garber Warner Conrardy, PC serves as the Debtor's legal counsel. UNIGEL GROUP: Asks NY Court to Recognize Foreign Proceedings ------------------------------------------------------------ Emlyn Cameron of Law360 reports that the subsidiaries of Brazilian petrochemical company Unigel Group have filed a request with a New York bankruptcy court to recognize their foreign bankruptcy proceedings. The companies are seeking to address approximately $810 million in debt, citing liquidity issues caused by inflation and the war in Ukraine, the report states. About Unigel Participacoes SA Unigel Participacoes SA is a Brazilian fertilizer manufacturer. Unigel Participacoes sought relief under Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 24-11982) on November 15, 2024. VERTEX ENERGY: Court Approves Chapter 11 Plan Disclosures --------------------------------------------------------- Yun Park of Law360 Bankruptcy Authority reports that on November 18, 2024, a Texas bankruptcy judge approved the disclosure statement for Vertex Energy's Chapter 11 plan, which could provide a path for recovery for unsecured creditors after a global settlement was reached with the creditor's committee and lender groups. About Vertex Energy Vertex Energy, Inc., together with its subsidiaries, is an energy transition company and marketer of refined products and renewable fuels in Houston. Vertex Energy filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Texas Lead Case No. 24-90507) on September 24, 2024, listing $772,368,000 in assets and $642,819,000 in liabilities. The petitions were signed by R. Seth Bullock as chief restructuring officer. Judge Christopher M. Lopez oversees the case. Jason G. Cohen, Esq., at Bracewell, LLP represents the Debtors as counsel. VROOM INC: 98% Convertible Noteholders Support Restructuring Plan ----------------------------------------------------------------- Dorothy Ma of Bloomberg Law reports that auto financier Vroom has gained the backing of 98% of its convertible debt holders for its restructuring plan, according to Eric Michael English, an attorney with Porter Hedges representing the company. According to Bloomberg Law, the plan involves restructuring $290 million in convertible bonds, giving bondholders approximately 93% ownership in the reorganized company. Existing shareholders will retain the remaining equity. Following its bankruptcy filing last week, a bankruptcy court judge approved a January 8 hearing to review and potentially confirm the proposed plan, the report states. About Vroom Inc. Vroom, Inc. (NASDAQ: VRM) is a parent company of United Auto Credit Corporation and CarStory. Previously, it was a used car retailer and e-commerce company that let consumers buy, sell, and finance cars online. Vroom ceased e-commerce automotive sales operations on Jan. 22, 2024. Vroom Inc. sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Case No. 24-90571) on November 13, 2024. In the petition filed by Thomas Shortt, as chief executive officer, the Debtor reports total assets as of September 30, 2024 of $43,807,067 and total debts as of September 30, 2024 of $304,615,138. Honorable Bankruptcy Judge Christopher M. Lopez oversees the case. John F. Higgins, Esq., at Porter Hedges LLP, in Houston, Texas, serves as the debtor's bankruptcy counsel. Latham Watkins LLP serves as the debtor's corporate, finance, tax, and securities counsel. Stout Risius Ross, LLC, serves as the debtor's financial advisor. Deloitte Touche Tohmatsu Limited serves as the debtor's tax consultant. The Overture Group, LLC, serves as the debtor's compensation consultant. Verita Global is the debtor's noticing and solicitation agent. WASHINGTON BOI: Court Approves Use of Cash Collateral ----------------------------------------------------- The United States Bankruptcy Court for the Southern District of Georgia has issued a Final Order granting Washington BOI Transport, LLC authority to use cash collateral in the amount of $9,154.00, plus a 25% variation, for operating the business as a Debtor-in-Possession under Chapter 11 of the U.S. Bankruptcy Code. The court has also granted a replacement lien to each lender in the debtor's post-petition accounts receivable and bank accounts, with the same extent, validity, and priority as each lender's pre-petition lien. This replacement lien will not attach to causes of action under Chapter 5 of the Bankruptcy Code. The order allows the debtor to challenge the extent, validity, or priority of any pre-petition lien, providing flexibility for the debtor to manage its financial obligations. This provision ensures that the debtor can negotiate with creditors and potentially restructure its debt obligations. If the case is converted to Chapter 7, the Chapter 7 administrative expenses will have priority over any claim arising under 11 U.S.C. section 507(b). This provision ensures that the administrative expenses incurred during the Chapter 7 process will be paid before any claims arising from the use of cash collateral. About Washington Boi Transport Washington Boi Transport, LLC is a transportation or logistics company. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Ga. Case No. 24-40870) with $100,001 to $500,000 in assets and $500,001 to $1 million in liabilities. Judge Edward J. Coleman oversees the case. The Debtor is represented by: Jon A. Levis, Esq. Levis Law Firm, LLC 101 S. Main Street Swainsboro, GA 30401 Telephone: 478-237-7029 Email: bkymail@levislawfirmllc.com WELLPATH HOLDINGS: Court OKs December Auction for Division ---------------------------------------------------------- Ben Zigterman of Law360 Bankruptcy Authority reports that a Texas bankruptcy judge has decided to approve the bidding procedures for the assets of prison healthcare provider Wellpath and set a December auction for its behavioral health division, Recovery Solutions. About Wellpath Holding Inc. Wellpath Holdings, headquartered in Nashville, Tennessee, provides medical, dental, and behavioral health services to patients in local detention facilities, federal and state prisons and behavioral healthcare facilities. Wellpath is privately owned by H.I.G. Capital. Wellpath Holding Inc. sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Case No. 24-90533) on November 11, 2024. In its petition, the Debtor estimated assets and liabilities between $1 billion and $10 billion each. WELLPATH HOLDINGS: Court Stays Vaughn Lawsuit Due to Bankruptcy --------------------------------------------------------------- The Honorable Matthew F. Leitman of the United States District Court for the Eastern District of Michigan will stay the case captioned as JADA MARIE VAUGHN, Plaintiff, v. BRIAN WILSON, et al., Defendants, Case No. 20-cv-11658 (E.D. Mich.), to allow the parties to investigate what impact, if any, Wellpath's bankruptcy has on this action. On March 11, 2024, Defendant Evan Soltis filed a motion for summary judgment in this action. The Court set the motion for a November 13, 2024, hearing, and the Court was prepared to hear argument from the parties on that date and issue a ruling on the motion shortly thereafter. On the morning of the hearing, counsel for Soltis informed the Court that Soltis' employer, Wellpath LLC, had filed for Chapter 11 bankruptcy in the days leading up to the hearing. Counsel therefore asked the Court to delay ruling on the motion due to the pending bankruptcy. The Court will administratively terminate Solits' pending motion for summary judgment without prejudice. That motion may be reinstated, if necessary, once the Court and parties receive further clarity on the impact of Wellpath's bankruptcy. Finally, the Court will set a status conference in this action for some time after April 1, 2025, to receive an update from the parties on the status of the bankruptcy. The Court believes that given the complexity of Wellpath's pending bankruptcy, counsel will need that amount of time to fully consider and determine the appropriate next steps in this action A copy of the Court's decision dated November 13, 2024, is available at https://urlcurt.com/u?l=LYOs5x About Wellpath Holdings Wellpath Holdings, Inc. f/k/a CCS-CMGC Holdings, Inc. is a provider of medical and mental healthcare in jails, prisons, and inpatient and residential treatment facilities. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Lead Case No. 24-90533) on November 11, 2024, with $1 billion to $10 billion in assets and liabilities. Timothy Dragelin, chief restructuring officer and chief financial officer, signed the petitions. The Debtor tapped Marcus A. Helt, Esq. at McDERMOTT WILL & EMERY LLP as bankruptcy counsel; FTI CONSULTING, INC. as financial advisor; and LAZARD FRERES & CO. LLC and MTS PARTNERS, LP as investment bankers. WOM SA: Receives Revised Takeover Proposal From Stalking Horse -------------------------------------------------------------- Carolina Gonzalez of Bloomberg News reports that WOM has received an improved takeover offer from the group that initially presented a stalking horse bid earlier this month, according to court filings. The company's attorney mentioned in a recording attached to the court documents that no other bids were submitted. According to Bloomberg Law, negotiations for the final terms of the offer are ongoing and should be finalized in the coming days. The offer includes exit financing and additional commitments from the counterparty. About WOM SA WOM is a Chilean telecommunications provider, focused on offering mobile voice, data, and broadband services, along with a rapidly expanding "Fiber to the Home" broadband offering, to consumers and businesses in Chile. Since the acquisition of Nextel Chile in 2015 through Novator Partners LLP's investment vehicle NC Telecom AS, WOM has expanded from having virtually no market share to establishing itself as the second-largest mobile network operator in Chile. WOM sought relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 24-10628) on April 1, 2024. In the petition filed by Timothy O'Connoer, as independent director, the Debtor estimated assets and liabilities between $1 billion and $10 billion each. The Honorable Bankruptcy Judge Karen B. Owens oversees the case. The Debtors tapped White & Case, LLP as general bankruptcy counsel; Richards, Layton & Finger, P.A. as local bankruptcy counsel; Riveron Consulting, LLC, as financial advisor; and Rothschild & Co US Inc. as investment banker. Kroll Restructuring Administration, LLC, is the claims agent. ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. On Thursdays, the TCR delivers a list of recently filed Chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. The Sunday TCR delivers securitization rating news from the week then-ending. TCR subscribers have free access to our on-line news archive. Point your Web browser to http://TCRresources.bankrupt.com/and use the e-mail address to which your TCR is delivered to login. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Valerie Udtuhan, Howard C. Tolentino, Carmel Paderog, Meriam Fernandez, Joel Anthony G. Lopez, Cecil R. Villacampa, Sheryl Joy P. Olano, Psyche A. Castillon, Ivy B. Magdadaro, Carlo Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors. Copyright 2024. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $975 for 6 months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Peter A. Chapman at 215-945-7000. *** End of Transmission ***