Welcome to WSJ Pro Bankruptcy's Daily Briefing. It's Thursday, March 12. In today's briefing, private credit continued to show signs of stress, with Cliffwater setting a new redemption cap and JPMorgan marking down the value of some loans.

Private-asset manager and investment adviser Cliffwater on Wednesday said it would cap redemptions on its $32.5 billion flagship private-credit fund after requests from investors surged, the latest in a series of jitters about potential instability in private lending.

Cliffwater Corporate Lending Fund, an investment vehicle which is not publicly traded but gives investors an opportunity to cash out at set intervals, received requests from investors to return nearly 14% of its shares, according to a letter sent Wednesday that was viewed by The Wall Street Journal. The firm said it would honor 7%, more than the 5% redemption rate it guarantees every quarter and the maximum its structure allows it to offer.

Investors in private-credit funds run by firms including Blue Owl and Blackstone have been flocking to the exits in recent weeks, partly due to concerns that new artificial intelligence tools could dent the value of software companies that borrow from many of the funds.

Some fund managers in the sector have stuck to preset redemption limits while others have allowed more investors than usual to cash out.

—Ben Glickman, Peter Rudegeair

JPMorgan Chase has tightened lending to private credit funds and marked down the value of some loans in their portfolios, according to multiple reports, in yet another blow to a beleaguered private credit industry.

The loans it is devaluing are to software companies, which have come under scrutiny in recent months because of the potential risk of disruption by artificial intelligence. JPMorgan’s decision will limit how much money the bank lends to private credit groups against those loans, the Financial Times first reported.

Personal injury victims are seeking to dismiss Vanderbilt Minerals’ chapter 11 case, asserting the bankruptcy is a strategic maneuver designed to limit compensation and strip them of their right to a jury trial.

The Connecticut-based mineral mining and distribution company filed for bankruptcy last month in the U.S. Bankruptcy Court in Syracuse, N.Y., to address more than 1,400 talc-related asbestos lawsuits.

Although Vanderbilt no longer mines talc, a committee representing the claimants said in a court filing that asbestos contamination from the company’s former talc operations caused fatal illnesses. The committee contends the bankruptcy was orchestrated to shield Vanderbilt’s parent company from liability while curtailing victims’ legal rights.

Judge Wendy Kinsella has scheduled a hearing for Thursday to consider the committee’s motion to dismiss.

—Akiko Matsuda

Billionaire Tilman Fertitta has been in exclusive talks to buy Caesars Entertainment for roughly $7 billion after he topped a competing offer from billionaire investor Carl Icahn’s firm, according to people familiar with the matter.

Fertitta’s company, Fertitta Entertainment, has been discussing paying around $34 a share for the betting company, the people said. Caesars shares closed Tuesday at $26.01, giving the company a market value of over $5 billion. Caesars shares closed up nearly 12% Wednesday at $29.07 after The Wall Street Journal reported on the talks.

Caesars was taken private in a leveraged buyout in 2008 led by Apollo Global Management and TPG. Caesars’ operating unit emerged from bankruptcy in 2017, after having been saddled with debt from that deal.

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