Bloomberg Law reports that that the U.S. Trustee's Office is working to combat the recent rise of "pre-packaged" chapter 11 bankruptcy filings. A pre-packaged bankruptcy or a "pre-pack" refers to the circumstances in which a debtor negotiates its reorganizational agreements with key stakeholders before filing its chapter 11 case and then files and confirm its plan of reorganization often within days. This process is theoretically reserved for "extraordinary circumstances"; however, the pace of pre-packaged cases has increased, as has the speed at which they are getting approved.  As just two examples in the past year alone, HighPoint Resources Corp. confirmed a reorganization plan in four days in March, while Belk Inc. confirmed a reorganization plan in a mere sixteen hours in February. These expedited cases are attractive to debtors due to the time and cost savings they present, but some academics and judges worry that pre-packs diminish the integrity of the bankruptcy process and do not sufficiently safeguard the rights of creditors. [Bloomberg Law; April 5, 2021].

Per Forbes, after six consecutive years of losses totaling more than $4.5 billion, LG has announced its intention to exit the mobile phone business. Although LG still ranks as the third largest smartphone brand in the U.S. and accounted for 11% of smartphone sales in 2020, it has fallen significantly behind some of its larger rivals. The company had indicated that, going forward, it will be focusing on its electric vehicle components, connected devices, smart home and artificial intelligence businesses. LG expects to have fully exited the mobile phone sector by the end of July. [Forbes; April 5, 2021].

The Wall Street Journal reports that GameStop Corp. - of Reddit and Wall Street Bets fame (or infamy) - has announced plans for an at-the-market stock sale of up to $1 billion over the next several months. Although the exact timing and amount of the sale "will depend on various factors," the company will look to sell up to 3.5 million shares in the near-term. GameStop's announcement follows other successful efforts by "meme" companies such as AMC to use their recent popularity among retail investors to raise money through additional stock issuances.  WSJ; April 5, 2021].

The Wall Street Journal also reports that the committee representing sex-abuse victims in the Boy Scouts of America bankruptcy case is seeking to gain further leverage in the case by attempting to propose its own reorganization plan.  Specifically, in objecting to the debtors' request for the continued, exclusive opportunity to propose and solicit acceptances of a reorganization plan, the committee, which represents nearly 84,000 sex-abuse victims, argues that the plan most recently proposed by the debtors does not adequately compensate those who suffered abuse and is thus unconfirmable. That plan proposes up to $6,100 in compensation for each victim while the committee has suggested that each victim may be entitled to over $800,000 each. [WSJ; April 2, 2021]

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