Bankruptcy Law

Lawyer accused of hiding real estate client funds in trust account is convicted of bankruptcy fraud

An attorney accused of helping a client who was once a successful real estate developer conceal a substantial sum of money in a law firm trust account has been convicted in federal court in Arkansas following weeks of trial. K. Vaughn Knight, 46, of Fayetteville was convicted Monday of eight…

Nov 19, 2013 10:20 PM CST

ABA seeks to limit reach of Anna Nicole Smith case restricting bankruptcy judges’ powers

Bankruptcy courts may decide matters outside their constitutional authority without violating Article III of the Constitution, as long as the litigants consent, the ABA argues in an amicus brief filed with the U.S. Supreme Court. The brief (PDF) says the Supreme Court should not extend the holding in the 2011…

Nov 19, 2013 8:04 PM CST

Investors fleeced in $6B Stanford scheme get a penny on the dollar from court-appointed receiver

Investors fleeced of $6 billion by now-imprisoned swindler R. Allen Stanford have gotten restitution checks from a court-appointed receiver. They range from $2.18 to $110,000, amounting to less than a penny of recovery for each dollar lost, reports the Center for Public Integrity. The receiver, Ralph Janvey, and his team…

Oct 11, 2013 4:10 PM CDT

Lawyer refunds $8,200 in fees to bankruptcy client $6,371 in debt

Corrected: A Pennsylvania lawyer has agreed to repay a bankruptcy client’s $8,200 in fees after the filing’s trustee discovered that the party’s debts amounted to $6,371. According to the Erie Times, the bankruptcy trustee said that Marla Snavley could have used the money to pay off her debts rather than…

Sep 13, 2013 6:59 PM CDT

How much has Weil Gotshal earned in Lehman Brothers’ bankruptcy?

How much has Lehman Brothers Holdings paid to lawyers and other bankruptcy professionals since it’s 2008 Chapter 11 filing? More than $2 billion, Bloomberg News reports, with almost $500 million going to Lehman counsel Weil, Gotshal & Manges. Lehman creditors are set to get 18 cents on the dollar by…

Sep 11, 2013 6:48 PM CDT

No criminal or civil charges against top Lehman execs, five years after investment bank collapse

Almost exactly five years after the collapse of Lehman Brothers nearly sank the U.S. economy, regulators of the banking industry remain concerned that the country’s six largest lending institutions may still be undercapitalized even though their reserves have nearly doubled since then. “The basic model hasn’t changed much, and it’s…

Sep 10, 2013 5:10 PM CDT

Shook Hardy OKs $5M settlement with trustee overseeing bankruptcy of convicted ex-client’s company

Shook Hardy & Bacon has not admitted liability. However, the 500-lawyer, Kansas City, Mo.-based law firm has agreed to settle for $5 million a bankruptcy trustee’s civil complaint contending that it and an associate attorney aided and abetted a former client’s violations of federal securities law. The ex-client, Nevin Shapiro,…

Sep 10, 2013 11:00 AM CDT

Law firm that filled in petition blanks wasn’t ghostwriting, 11th Circuit says

A federal appeals court has overturned sanctions imposed on lawyers after an employee at their law firm helped a client fill in the blanks of a bankruptcy petition without disclosing that assistance when the document was filed with the U.S. bankruptcy court. Filling in the blanks didn’t amount to fraud…

Sep 5, 2013 2:58 PM CDT

A bankruptcy downturn squeezes restructuring practices

Bankruptcy filings are falling on a nationwide basis, forcing some law firms to cut the size of their restructuring practices or reallocate their lawyers. In the Southern District of New York, the number of business Chapter 11 filings dropped 71 percent over the four-year period from June 2009 to June…

Sep 4, 2013 11:20 AM CDT

Need an exorcism? Lawyer who drafted US bankruptcy code says it’s one of his skills

Prominent bankruptcy lawyer Kenneth Klee was a primary author of the U.S. bankruptcy code, has worked on the bankruptcy of Jefferson County, Ala., and teaches law at the University of California at Los Angeles. He charges about $1,000 an hour. But he has other skills, for which he suggests a…

Aug 27, 2013 12:01 PM CDT

Suspended lawyer ordered to pay $42K for misrepresenting self to bankruptcy clients

A Milwaukee lawyer who proclaims himself “Light Hero” has been ordered to pay more than $42,000 as part of a state lawsuit alleging he misrepresented himself to bankruptcy clients while his license was suspended. U.S. District Court Judge J.P. Stadtmueller ordered Emory Booker and his Legacy Legal Group on Wednesday…

Aug 22, 2013 4:45 PM CDT

Howrey trustee reaches two ‘monumental’ settlements; ex-employees may now recover some cash

The trustee for the defunct Howrey law firm will recover millions of dollars of fees from a law firm that hired 11 of its antitrust partners and will use the money to pay off most of its debt to Citibank. Trustee Allan Diamond called the new settlements “monumental” and “a…

Aug 19, 2013 12:03 PM CDT

Clawback suits seek money paid by Dewey & LeBoeuf to bank, law firms and others while insolvent

Applying a rule that prevents a debtor from preferentially paying some creditors during the 90 days before seeking bankruptcy protection, the trustee for Dewey & LeBoeuf filed a dozen lawsuits Friday seeking to claw back funds from those they say received an extra share of the failing law firm’s money…

Aug 12, 2013 6:45 PM CDT

Casey Anthony agrees to pay $25K to bankruptcy estate to retain rights to her life story

A bankruptcy trustee won’t pursue “exclusive worldwide rights” to Casey Anthony’s story in exchange for her agreement to pay $25,000 to help pay creditors. U.S. Bankruptcy Judge Rodney May of Tampa approved the settlement on Wednesday, the Orlando Sentinel reports. The parties agreed to the $25,000 settlement after they were…

Aug 2, 2013 12:02 PM CDT

‘You Hate My Job’ radio series features bankruptcy trustee

Which jobs do Americans love to hate? A series airing on public radio stations highlights two of them: traffic officers who hand out parking tickets, and bankruptcy lawyers. The program at Marketplace.org features an interview with bankruptcy trustee Edward Wolkowitz, who says bankruptcy can provide relief from collector phone calls…

Aug 1, 2013 10:50 AM CDT