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ABC Carpet Unravels; Philippine Airlines Taps Bankruptcy Loan; Theranos Trial Delayed
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Good day. ABC Carpet & Home filed for chapter 11, felled by pandemic restrictions and an exodus of upscale urbanites from New York. Philippine Airlines is hoping for a speedy exit from bankruptcy. And the trial of Theranos founder Elizabeth Holmes was delayed over a juror's possible coronavirus exposure.
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The ABC Carpet & Home building in New York in 2018.
PHOTO: ERIN LEFEVRE FOR THE WALL STREET JOURNAL
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New York décor seller files bankruptcy. New York luxury home décor retailer ABC Carpet & Home filed for chapter 11 bankruptcy protection after more than a century selling rugs, luxury furniture and kitchenware to urbanites, blaming pandemic lockdowns and a “mass exodus” of potential customers from Manhattan. ABC enters bankruptcy with a roughly $15.3 million offer to take over its business selling upscale home furnishings from its multistory showroom in Manhattan’s Flatiron District and another location in Brooklyn’s Sunset Park neighborhood.
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Theranos trial paused over Covid. Just days into Theranos Inc. founder Elizabeth Holmes's criminal-fraud trial, issues have come up with three jurors in the case, raising concern from the federal judge overseeing what's expected to be a more than three-month-long trial.
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Fed officials prepare to scale back bond buying. Federal Reserve officials will seek to forge agreement at their coming meeting to begin scaling back their easy money policies in November. Under the plans taking shape, officials could reduce those purchases at a pace that allows them to conclude asset buying by the middle of next year.
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Latam Airlines has $5 billion bankruptcy-exit offers. Latam Airlines Group SA said it has received several offers from stakeholders to lift the airline out of bankruptcy, "each of which contemplate raising in excess of $5 billion through the issuance of new debt and equity."
In court papers filed Thursday, the Chilean company said it needs more time to formulate a restructuring plan backstopped by fresh investment but that negotiations so far have been constructive.
The airline also said it was examining whether to raise more secured financing, given the currently favorable market conditions. Latam filed for chapter 11 protection in May to reduce the size of its aircraft fleet, cut debt and cope with the pandemic’s impact on the aviation industry. — Andrew Scurria
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Endo settled with New York over opioids. Endo International PLC said it agreed to pay $50 million to settle with New York authorities over the opioid crisis while the drugmaker pursues a broader resolution to its vast opioid-related liabilities.
Endo said Thursday it is focused on resolving the nearly 3,000 legal cases pending against it from states, counties, cities and Native American tribes over opioids.
The settlement with New York removes Endo from an ongoing trial on the state attorney general's claims that several drugmakers contributed to widespread opioid addiction. Endo is also exploring strategic alternatives and "may seek to implement one or more of those alternatives" if it can't reach a broad global deal, the company said.
Endo has tapped financial restructuring advisers to look at options for weathering the opioid claims as well as more than $8 billion in corporate debt, The Wall Street Journal reported last month. — Andrew Scurria
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A California-based online university must pay $100,000 in legal fees to a bankrupt former student after it withheld her full transcript for her $6,300 outstanding tuition balance, a federal appeals court said. (Bloomberg)
Three former managers of a Florida financial services firm were charged with running a multimillion-dollar Ponzi scheme that is the subject of civil lawsuits against Deutsche Bank AG. (Bloomberg)
Zachary Horwitz, an actor in low-budget horror and science-fiction movies, has agreed to plead guilty to running a massive Hollywood Ponzi scheme. He admitted in court papers that he duped investors into giving him more than $650 million for fictitious movie deals with HBO and Netflix. (Los Angeles Times)
The former longtime CFO of drug manufacturer Aceto, has been sentenced by the U.S. District Court to six months in prison and six months of house arrest for securities fraud for insider trading. He sold his shares in the now-bankrupt company in April 2018, two weeks prior to public disclosure of its financial troubles. (CFO Dive)
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