Good day and welcome to WSJ Pro Bankruptcy's Daily Briefing. It's Friday, May 9. In today's briefing, a cyberattack on financial advisory firm BRG exposed data involved in Catholic Church sex-abuse bankruptcy cases, prompting the U.S. bankruptcy watchdog to question the firm's potential conflicts of interest and legal liability caused by the breach. And chipmaker Wolfspeed issued a going-concern warning, citing the need for a comprehensive restructuring after failing to reach a deal with creditors.

A cyberattack at a financial advisory firm exposed data in multiple Catholic church bankruptcy filings across the U.S. that contain information on sexual abuse victims.

An ongoing investigation has yet to determine whether the stolen data includes any identifiable information on the victims. The advisory firm, Berkeley Research Group, already faces questions from Justice Department officials about potential conflicts of interest and legal liability stemming from the ransomware attack and data theft.

The company, known as BRG, said a hacker accessed the data through its internal systems earlier this year, according to public notification letters in late April. BRG is working with sex-abuse victims in bankruptcy filings by dioceses, archdioceses and other Catholic orders in New Orleans, Baltimore, San Francisco, San Diego and at least a half dozen other U.S. cities.

Chipmaker Wolfspeed issued a going-concern warning alongside its third-quarter earnings report Thursday, indicating that it may not be able to continue operating without restructuring.

“This is a result of contemplating a strategic in-court transaction and indicates our belief that we will likely need a comprehensive solution to strengthen our balance sheet over the next 12 months,” a company spokesperson said about the warning. 

Wolfspeed’s outgoing financial chief, Neill Reynolds, said during the company’s earnings call that it may pursue restructuring either in or out of court.

The company has $1.3 billion in cash on hand and expects to receive $600 million in tax credit refunds in 2025, the spokesperson said.

Wolfspeed also disclosed that it held talks with an ad hoc group of its 2026 noteholders about a potential debt exchange but that the deal ultimately fell apart. The company needs to address a $575 million balloon payment due to its convertible noteholders in 2026 to unlock $750 million in government funding through the 2022 Chips Act.

Wolfspeed is working with law firm Latham & Watkins, financial adviser Perella Weinberg Partners and turnaround consultant FTI Consulting, The Wall Street Journal previously reported.                              —Alicia McElhaney

Accelerate Diagnostics has voluntarily initiated a chapter 11 restructuring proceeding in the U.S. Bankruptcy Court for the District of Delaware, and will seek to sell its assets through a court-supervised sale process.

The medical technology company has filed various "first day" motions with the bankruptcy court requesting customary relief that will enable it to transition into chapter 11 without material disruption to its ordinary course operations, including seeking authority to obtain debtor-in-possession financing and pay employee wages and benefits.

To provide necessary funding during the chapter 11 proceeding, Accelerate said it has received a commitment of up to $12.5 million in a multidraw DIP financing facility. Upon approval by the bankruptcy court, the DIP financing is expected to provide Accelerate with the necessary liquidity to operate in the normal course and meet obligations to its employees, vendors and customers throughout the chapter 11 proceeding while executing on the sale process.

Prior to the filing, the company agreed to terms with Indaba Capital Management—a majority holder of Accelerate's prepetition secured notes—to buy substantially all the assets of the company. The purchase price of Indaba's stalking-horse bid includes a credit bid of $36.9 million of Indaba's existing secured notes and DIP financing facility, certain assumed liabilities, and excluded cash sufficient to wind down the company following sale closing.

If no other qualified bids are received, Indaba will be deemed the successful bidder.

—Chris Wack

Rhode Island Health and Educational Building Corp. plans to sell $140.7 million of bonds to help finance CharterCARE Health of Rhode Island's purchase of a regional care network that includes the Roger Williams Medical Center and Our Lady of Fatima hospitals.

The corporation will offer hospital financing revenue bonds, consisting of $88.1 million of Series A debt and $52.5 million of Series B federally taxable securities, according to documents posted Wednesday on MuniOS.

Pricing is set for May 22, with closing slated for May 29. The bonds are special limited obligations of the corporation. They are backed solely by payments made by the obligated group consisting of the Centurion Foundation, the parent of CharterCARE Health of Rhode Island, CharterCARE Roger Williams Medical Center, CharterCARE Our Lady of Fatima and CharterCARE Health of Rhode Island.

Interest on the bonds will accrue from the date of delivery and be payable semiannually starting on Nov. 15.

Proceeds from the sale will be used to help fund CharterCARE Health of Rhode Island's purchase of assets from Prospect Medical Holdings, which filed for chapter 11 bankruptcy protection in January.

The Roger Williams Medical Center and Our Lady of Fatima hospitals have 532 licensed beds and approximately 2,400 employees. The network also includes a physician group practice, a regional cancer center, an acute rehabilitation center, an addiction-medicine center and a community primary-care center, according to the roadshow document posted on MuniOS.

S&P Global Ratings has assigned a BB- rating to the bonds, with a negative outlook. Barclays is the underwriter on the deal.

—Patrick Sheridan

Former cryptocurrency evangelist Alex Mashinsky was sentenced to 12 years in prison on Thursday after pleading guilty to fraud in connection with the multibillion-dollar collapse of his firm, Celsius Network, three years ago.

A pseudobank that touted returns of as much as 18.6% on customers’ crypto deposits, Celsius was one of the first big crypto companies to topple into bankruptcy after a downturn in the digital-currency markets began in the spring of 2022.

• Early opponents of corporate influence in healthcare are spotting parallels in another trusted profession where private equity is making a push: accounting.
• AI is changing the way we search online. Advertisers are already falling behind.
• IBM has used AI to replace the work of a couple hundred human resources workers. As a result, it has hired more programmers and salespeople, and it promises higher total employment.
• WeightWatchers, whose dieting and wellness programs were once a central part of U.S. fitness culture, has filed for bankruptcy to adjust to the increasing use of drugs for weight loss.

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