Below is our initial take on recent bankruptcy-related developments:

Texas Bankruptcy Trial Begins Over $2 Billion Energy Bill After 2021 Winter Storm | Reuters

The trial started this week in the case between now-bankrupt Brazos Electric Power Cooperative Inc. and Electric Reliability Council of Texas (ERCOT) over a $2 billion invoice related to the deadly winter storm in Texas last year.

S&K Take: Brazos is attempting to reduce the $2 billion bill it got from ERCOT after Winter Storm Uri. ERCOT charged power cooperatives $9,000 per kWh in surge pricing, which ERCOT (Texas’ grid operator), which it argues was appropriate under the terms of its agreements with Brazos. Brazos argues the tab should be more like $770 million. The numbers are obviously mind boggling and the price tag seems egregious, but this looks more like a contractual issue that the bankruptcy court will have to sort out.

Seadrill Expects to Emerge from Bankruptcy This Week | The Maritime Executive

Offshore drilling contractor Seadrill plans to emerge from its second bankruptcy in four years, working to meet the conditions of its approved bankruptcy plan.

S&K Take: Seadrill is set to emerge from their second bankruptcy in 4 years. Time will tell whether this round is enough, although with oil prices racing towards $100 per barrel it would seem to bode well for offshore drillers (which have had an extraordinarily tough go of things for the last few years). John Fredriksen will lose his equity in this restructuring, although he will retain a $50 mm convertible bond that could be worth 5% of the company in certain future circumstances.

Boy Scouts, Pachulski Reach $2M Deal In Email Row | Law360

Please note that membership to Law 360 is required to access the full summary of this article.

A law firm representing sex abuse victims will pay $1.25 million to the Youth Protection Program of the Boy Scouts of America to resolve a dispute over an email threatening the Boy Scout’s bankruptcy plan.

S&K Take: The settlement seems to mark the end of one chapter in the Boy Scouts’ saga, albeit an interesting one for bankruptcy practitioners. Pachulski, which represents the TCC, had some part in the dissemination of what has been labeled an inflammatory email that was sent to sexual abuse victims. For this, Pachulski has agreed to contribute $1.25 million to a Youth Protection Program and write off $750,000 in fees. This is only one small piece of the acrimonious case, which seems to be approaching global resolution.

Judge Eyes Tweaks for NJ Diocese’s Ch. 11 Plan Disclosures | Law360

Please note that membership to Law 360 is required to access the full summary of this article.

The bankruptcy judge overseeing the Diocese of Camden’s Chapter 11 proceedings will require modifications to its disclosure statement of the Chapter 11 plan.

S&K Take: Disclosure statements, which are in theory supposed to describe a plan to claimants in plain English, frequently fail miserably in that regard. In an attempt to resolve objections, Debtors add more language which makes the DS more convoluted. The DS is particularly important in cases like these, where claimants are individuals who are trying to understand their rights under a proposed plan. It will be interesting to see what the Judge decides to do in this circumstance given the case sensitivities.

Purdue’s Sackler Owners Propose Up to $6 Billion Opioid Settlement | Reuters

The Sackler family, owners of Purdue Pharma LP, proposed an alternative settlement to resolve allegations that the OxyContin maker contributed to the deadline opioid epidemic, which would allow the company to emerge from bankruptcy.

S&K Take: In a follow on to last Friday’s edition of What’s News, the Sacklers have agreed to increase consideration provided in the Purdue settlement by $1.6 billion. That addition is going to be structured over some time, but it is a big move towards a resolution. AS we have noted in the past, ta prospective settlement could moot the appeal to the Second Circuit to determine if bankruptcy courts have the ability to grant third party non-consensual releases, which is a wildly hot topic in the bankruptcy world.