A corporate restructuring and bankruptcy BLOG

    GWG files billion-dollar bankruptcy; Infowars tests subchapter V; more senior living and real estate restructurings

    What's News
    April 22, 2022

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

    Life Insurance Bond Seller GWG Files for Ch. 11 Amid SEC Probe | Reuters

    GWG Holdings Inc, a financial services firm that’s being investigated for its accounting by the SEC, has filed for Chapter 11 bankruptcy protection in Texas with $2 billion in debt.

    S&K Take: Billion-dollar bankruptcies have been few and far between recently, so the GWG filing is notable for that alone. This case also looks likely to raise some interesting issues, as it comes with an interesting organizational and capital structure. At first glance, it would seem like there is a low probability of an unsecured creditors’ committee, and certain other financial stakeholders look to be limited to recourse against specific Debtor entities. The Court, however, seems adamant that a UCC will be appointed per comments at the first day hearing. We will watch this case closely as it unfolds over the next few weeks.

    Infowars Files for Bankruptcy After Sandy Hook Defamation Lawsuits | Axios

    Infowars, the far-right conspiracy theory website owned by Alex Jones, filed for Chapter 11 bankruptcy in Texas, with an estimated $10 million in liabilities.

    S&K Take: Jones, an inflammatory (to say the least) political personality, is seeking to use subchapter V of the Code in these cases. The majority of the Debtors’ liabilities are contingent, so in theory the Debtors could be eligible for the more streamlined chapter 11 process. That process does not require the appointment of a creditors’ committee, although such appointment could be granted for cause. Such appointment will likely be the first battleground with litigation claimants, which account for the vast majority of the Debtors prepetition claims.

    Luxury Senior Living Home is on Brink of Collapse, Landlord Says | Reuters

    Northwest Senior Housing Corporation, a Dallas-based luxury senior living community, filed for Chapter 11 bankruptcy protection with nearly $112 million in debt.

    Nursing Home Operator Postpones Final Hearing on Bankruptcy Plan | Reuters

    U.S. Bankruptcy Judge Karen Owens, who is overseeing Gulf Coast Health Care LLC's bankruptcy, moved to postpone the final hearing of its proposed liquidation plan.

    S&K Take: Senior living facilities continue to be prevalent in the restructuring landscape. These two cases are at different ends of the bankruptcy spectrum. Northwest just filed, while Gulf Coast is on the precipice of plan confirmation. Judge Owens, however, is requiring that plan objectors be provided a report analyzing litigation prospects in the case before the hearing proceeds.

    Historic L.A. Building With Banksy Mural for Sale Following Tarina Tarantino Bankruptcy Filing | WWD

    Tarina Tarantino Management, the owner of a building in Los Angeles with a Banksy mural on the side of the building, has filed for Chapter 11 bankruptcy protection with an $8 million secured loan claim. The historic building is included in the filing and is up for sale.

    S&K Take: Another recurring restructuring theme is real estate. This one has a few interesting angles given the names attached.

    The opinions expressed are those of the author(s) and do not necessarily reflect the views of the firm or its clients, or any of its or their respective affiliates. This article is for general information purposes and is not intended to be and should not be taken as legal advice.

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