Bestwall’s official asbestos committee filed a petition seeking a writ of certiorari with the US Supreme Court over injunction provisions enjoining asbestos lawsuits against non-debtors. The asbestos committee argues that in 2017, the solvent Georgia-Pacific attempted to sequester its asbestos liabilities in a new entity, Bestwall, that it designed for bankruptcy, while shielding most of its valuable assets in a new separate entity that it kept outside of bankruptcy. As part of the Chapter 11 case, the bankruptcy court enjoined thousands of asbestos lawsuits against Bestwall and non-debtors. Through an appellate process, the US Court of Appeals for the Fourth Circuit ultimately entered judgment in June, affirming the bankruptcy court’s decision granting the non-debtor injunction, and denied petitions for rehearing en banc in August.

Also this week, two individual general unsecured creditors of 4E Brands filed a complaint seeking to vacate the company’s plan confirmation order due to the failure on the part of former Judge David R Jones of the US Bankruptcy Court for the Southern District of Texas, who previously oversaw the case, and law firm Jackson Walker to disclose the details of a romantic relationship between the judge and one of the firm’s partners. The creditors cited mechanisms for filing Chapter 11 cases in the Southern District of Texas – including the 4E Brands case – in a way allegedly designed to ensure that they would be assigned to Judge Jones, calling the procedures “judge shopping at its easiest.” The creditors also sought to renew their request to have Judge Marvin Isgur removed from overseeing the 4E Brands case, citing new evidence that Judge Isgur had referred to Judge Jones as his “adopted son.”

In other news, Carnival, roughly a week ahead of an anticipated trial over foreclosure and contempt accusations against DeCurtis debtor-in-possession (DIP) lender Invictus Global Management, announced a deal with DIP collateral transferee, UnumX. The agreement was announced at a status conference, and particulars of the deal have not been disclosed. The cruise giant stated, however, that the deal would narrow the issues set for trial.

FTX Trading also made headlines, as it announced settlements with the defendants in litigation over Embed Financial Technologies. Specifically, FTX and Alameda Research founder Sam Bankman-Fried and former company officers Nishad Singh and Zixiao Gary Wang have agreed to drop any claim to stock in Embed. Judge John Dorsey of the US Bankruptcy Court for the District of Delaware has scheduled a 25 January hearing to consider the trio of separate-but-interrelated settlements. FTX notes in the settlements that these deals resolve only the Embed-specific claims against the three defendants.

This was a busy week in Chapter 11 plan news. Shortly after filing its amended Chapter 11 plan, Endo International filed its second amended restructuring support agreement which, among other things, reflects the terms of the amended plan and various settlement agreements reached with several key creditor constituents. PGX Holdings obtained confirmation of its plan that provides for the issuance of PIK notes and a settlement with former employees asserting claims under the Worker Adjustment and Retraining Notification (WARN) Act. Also, Wesco Aircraft Holdings (d/b/a Incora) filed an amended plan that would now hand 3.5% of the company’s reorganized equity to its general unsecured creditors, taking a small stake of the equity that was previously all going to first lien lenders before the parties reached a settlement, while Core Scientific also filed an amended plan to reflect a global settlement reached with its unsecured creditors committee. Alpine Summit Energy Partners filed a plan of liquidation, and Instant Brands filed a plan of liquidation that provides for the creation of a litigation trust to pursue various causes of action.

In terms of new Chapter 11 filings, PARTS iD, Inc commenced a prepackaged case with a plan and disclosure statement in hand, along with DIP financing in the form of USD 12m in new money and a roll-up of prepetition debt. Through the plan, the technology-driven, digital commerce company that focuses on transforming the US automotive aftermarket and the adjacent complex parts markets proposes to hand the company’s preferred stock to new money DIP lenders and the common stock to lenders with DIP roll-up claims.

In sale news, Aspen Valley Ranch owner AVR AH LLC’s bankruptcy judge granted a motion by the debtors’ secured lenders requesting an extension of the sale order’s closing deadline, preserving their purchase rights amid a so-far fraught effort to complete the USD 30.5m deal. The order initially set a deadline of 22 November, but on 21 November the buyers claimed a default by the debtors under the purchase agreement based upon alleged nonpayment of HOA fees. As they negotiated on the day of the deadline, title and escrow holder Fidelity National Title Insurance Company suffered a crippling data breach that shut down its systems until “at least” 28 November. Though the debtors and buyers filed a notice that they extended the closing date to 28 November, backup bidder Fleeger Family First LP entered the fray arguing that it now stands as the winning bid because the lender-buyers violated the sale order.

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Next week, Debtwire subscribers can look forward to our coverage of Inversiones Latin American Power’s confirmation hearing, AeroCision’s disclosure statement hearing, and much more.

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