Bankruptcy Law

Turnaround guru calls for cap on legal fees in Chapter 11 cases

Fees should be capped for the lawyers who represent companies in Chapter 11 bankruptcies, and they should not be paid at all for pursuing “outlandish” theories, a turnaround guru told attendees at a Friday program. Speaking at a Maryland meeting of an American Bankruptcy Institute commission that is studying Chapter…

Apr 22, 2013 7:50 PM CDT

7th Circuit OKs $25K student-loan discharge for ‘destitute’ paralegal

A “destitute” paralegal who has made reasonable efforts to repay her student loan debt is entitled to a bankruptcy discharge of the remaining $25,000 or so despite the fact that she never enrolled in a federal income-contingent repayment plan, a federal appeals court has ruled. Reinstating a bankruptcy court’s determination…

Apr 10, 2013 6:20 PM CDT

Closing attorney loses federal mortgage fraud appeal, now faces likely lengthy prison term

A federal appeals court has reinstated the conviction of a North Carolina real estate closing attorney who faces a sentence of up to 25 years in a mortgage-fraud case. Convicted for her role in closing 210 transactions between 2000 and 2004, for which she received $235,000 in attorney fees, Victoria…

Apr 9, 2013 9:04 PM CDT

Howrey trustee sues seven more law firms

Seven more law firms are facing clawback lawsuits filed as the bankruptcy trustee for Howrey seeks to recover fees earned by lawyers who jumped to the new firms and took Howrey cases with them. Bankruptcy trustee Allan Diamond filed the suits on Friday and says more are being planned, the…

Apr 8, 2013 11:53 AM CDT

Ex-client sues Shearman, says firm didn’t warn of $76M pension shortfall before deal closed

A former client has sued Shearman & Sterling, contending that the law firm failed to warn him about $76 million in underfunded pension liability before a deal went through as part of a corporate reorganization plan concerning two of his companies. Newsprint magnate Peter Brant alleges that as a result…

Apr 3, 2013 9:37 PM CDT

Judge OKs record municipal bankruptcy, says city can’t otherwise provide services

In what is being billed as the biggest municipal bust ever, the city of Stockton, Calif., has been given a green light, over the objection of creditors, to go ahead with a bankruptcy case after a required 90-day mediation period. U.S. Bankruptcy Judge Christopher Klein ruled Monday that creditors did…

Apr 1, 2013 10:33 PM CDT

Baker Botts gets another $5.2M in litgation over $142M fee award in $6B bankruptcy case

After years of litigation, Baker Botts was awarded another $5.2 million in legal fees on Tuesday for defending its earlier $142 million fee award for representing a copper mining operation in a bankruptcy case. The law firm’s representation of Asarco LLC was part of a long-running legal battle that began…

Mar 28, 2013 6:13 PM CDT

LAPD to get tapes of defense lawyer talks with convicted ‘Charles Manson family’ killer

After months of litigation and two court rulings, it looks like the Los Angeles Police Department may be on the verge of getting hold of long-ago taped conversations between a now-deceased Texas defense lawyer and a member of the notorious Charles Manson “family” convicted in multiple 1969 murders that terrorized…

Mar 26, 2013 8:34 PM CDT

‘Churn that bill, baby!’ email surfaces in fee dispute with DLA Piper

It all began with a corporate bankruptcy case. Retained by energy entrepreneur Adam H. Victor in April 2010 to prepare the Chapter 11 filing for one of his companies, DLA Piper ran up a hefty bill. And when Victor refused to pay it, the law firm sued him for $675,000.…

Mar 25, 2013 8:54 PM CDT

Trustee wants to raise money to pay Casey Anthony’s debts by selling her life story

With nearly $800,000 in obligations, about $1,000 in assets and minimal work experience and training, it might seem that Casey Anthony, who is 26 and unemployed, has little likelihood of being able to pay the debts that drove her into bankruptcy. But a bankruptcy trustee has a different idea. Stephen…

Mar 18, 2013 10:55 PM CDT

Jones Day lawyer is Detroit’s new emergency financial manager

Jones Day restructuring partner Kevyn Orr has a new job that is expected to last about 18 months, if he succeeds. Orr was appointed on Thursday to be Detroit’s new emergency financial manager, report the Am Law Daily, Bloomberg News and the New York Times. Orr, 54, told reporters that…

Mar 15, 2013 12:01 PM CDT

Trustee for Howrey files first clawback claims against 6 of 71 law firms from which $200M is sought

The bankruptcy trustee in Howrey’s Chapter 11 case has filed clawback litigation against six of the 71 successor law firms to which former partners took unfinished business after the collapse of the Washington, D.C.-based litigation shop near the beginning of 2011. Although most are in settlement talks with trustee Allan…

Mar 14, 2013 2:45 PM CDT

Law firm settles Pfizer case, pays bills and emerges from Chapter 11 bankruptcy

In an unusual move, a Portland, Ore., law firm has been able to pay its bills and emerge from Chapter 11 bankruptcy after setting a big case. The same prolonged legal battle with Pfizer Inc. that forced Williams Love O’Leary & Powers to file for bankruptcy in 2011 also resulted…

Mar 14, 2013 2:26 PM CDT

$13M attorney fee in clergy abuse case is at center of ‘epic’ divorce fight

The lead lawyer who helped obtain a $660 million clergy abuse settlement in Los Angeles is now engaged in a long-running legal battle with his former spouse over her right to a split of his attorney fees in the case, estimated at $13 million. Lawyer Ray Boucher estimates the divorce…

Mar 12, 2013 1:15 PM CDT

Paul Hastings, 2 partners to pay $1.6M to settle Dewey unfinished business claim

Two former partners of Dewey & LeBoeuf, along with the law firm at which they now practice, Paul Hastings, have agreed to pay nearly $1.6 million to settle a claim over unfinished Dewey business they took with them to their new jobs. A filing Monday in New York says Paul…

Mar 6, 2013 5:30 PM CST