Bankruptcy Law

Lawyer Who Advised Clients to Break Into Foreclosed Homes Faces Criminal Charges

Updated: A California lawyer who made headlines by advising clients to break into their foreclosed homes to repossess them is now a defendant himself on multiple related criminal charges. Michael T. Pines, 59, who had his law license suspended last month, is accused of stalking and harassing the new owners…

May 23, 2011 4:47 PM CDT

Borders Asks Court for More Time on Bankruptcy Reorganization Plan

In a court filing yesterday, Borders Group asked for more time to file its bankruptcy reorganization plan, the Wall Street Journal’s Market Watch reports. The Manhattan U.S. Bankruptcy Court filing asked that the bookseller be given until October to file a plan and until December to solicit votes on the…

May 20, 2011 10:23 PM CDT

Hollywood Agent Mike Ovitz Sued Over $200K in Unpaid Legal Fees

A breach of contract case against Mike Ovitz, alleging that the Hollywood agent owes $200,000 to the law firm that defended him in a civil wiretapping case, was filed today in Los Angeles Superior Court, Deadline Hollywood reports. According to the website, the action was filed on behalf of the…

May 20, 2011 9:02 PM CDT

Washington Mutual and Big Creditors Settle Shareholder Lawsuit

The bankrupt Washington Mutual Inc. and its biggest creditors agreed to settle a fight with shareholders today, Bloomberg News reports. The agreement gives shareholders control of the company that will emerge from bankruptcy, according to the article, and includes $25 million for a litigation trust that would bring lawsuits to…

May 20, 2011 5:45 PM CDT

Yellowstone Club Founder Says He’ll Seek Court Sanctions Against Montana

Tim Blixseth, who founded Montana’s pricey and invitation-only Yellowstone Club, says that he will seek court sanctions from the state’s department of revenue, which recently lost a bankruptcy petition filed against the former billionaire. The petition sought $57 million in alleged unpaid taxes, the Associated Press reports. It would have…

May 19, 2011 7:07 PM CDT

Sbarro Inc. May Sell Rather Than Go Through Bankruptcy

Sbarro Inc., a fast-food chain serving Italian fare, announced a plan in April to enter bankruptcy, but today Bloomberg News reports that the business is instead negotiating a sale from a “strategic” buyer. Sbarro, based in Melville, N.Y., filed for Chapter 11 bankruptcy last month. The entity Sbarro is now…

May 19, 2011 3:41 PM CDT

Madoff Trustee Settles Litigation with So-Called Feeder Fund

The trustee liquidating Bernie Madoff’s firm agreed to not pursue $212 million from two bankrupt funds related to the Fairfield Greenwich Group, the biggest so-called feeder fund in the alleged Ponzi scheme, Bloomberg News reports. As part of the settlement with the trustee, both funds reduced their claims against the…

May 18, 2011 6:59 PM CDT

Ex-MLB Star Lenny Dykstra Indicted, Accused of Stripping His Own $18.5M Home After Chapter 11 Filing

A former Major League Baseball star has been indicted in a bankruptcy fraud case. Lenny Dykstra is accused of stealing from the bankruptcy estate by taking and selling, or destroying, property including sconces, a chandelier and gold fixtures from his $18.5 million mansion in Thousand Oaks, Calif., after his Chapter…

May 9, 2011 5:57 PM CDT

BigLaw Feels the Heat as Failed Companies and Their Trustees Blame Law Firms for Their Demise

Updated: Several law firms are facing malpractice suits accusing them of contributing to the demise of bankrupt companies, leading to harm to shareholders or investors. Some of the suits seek hundreds of millions of dollars in damages. Among the firms targeted are Bryan Cave, Sedgwick, Holland & Knight, and Baker…

May 6, 2011 3:53 PM CDT

Sedgwick Faces $200M Malpractice Suit by Receiver for Failed Financial Services Company

A receiver for a failed financial services company alleges in a $200 million malpractice suit that Sedgwick had a conflict of interest when it represented two competing divisions of the business. The suit claims Sedgwick aided the company, Medical Capital Holdings Inc., in a breach of fiduciary duty, Reuters reports.…

May 6, 2011 1:07 PM CDT

Fortuitious $3.97M Tax Refund Helps Ex-Rothstein Partner Settle with Bankruptcy Trustee for $1.9M

A former name partner in the law firm of convicted Ponzi schemer Scott Rothstein is going to be able to settle a $10 million suit filed by the bankruptcy trustee overseeing Rothstein Rosenfeldt Adler’s dissolution, with the help of a fortuitous tax refund from the Internal Revenue Service. Because Stuart…

May 5, 2011 6:48 PM CDT

Lawyer Accuses Judge of ‘Half-Baked Findings’ in Scathing Response to Sanctions Threat

A South Florida bankruptcy lawyer has filed a scathing response to a judge’s threat to sanction him, accusing the judge of drawing conclusions “from the ether” and making “half-baked findings.” Hollywood, Fla., lawyer Kevin Gleason asserts in his response that Judge John Olson “misremembered” the facts of a court hearing,…

Apr 27, 2011 12:23 PM CDT

Ethics Case Against Bankruptcy Lawyer Is Based Partly on His Representation of Hinshaw Partner

An attorney ethics commission is recommending a one-year suspension against a well-connected Illinois lawyer partly because of his conduct while representing a partner at Hinshaw & Culbertson. The bankruptcy lawyer, John Narmont, has political connections to Illinois House Speaker Michael Madigan and received support from a half dozen judges who…

Apr 25, 2011 2:01 PM CDT

Madoff Trustee’s Tally: $7.6B Recovered, $175.5M Sought in Legal Fees, Including Latest $43.2M Bill

A trustee working to resolve the mess convicted Ponzi schemer Bernard Madoff made of his securities firm’s affairs has submitted new numbers to the federal bankruptcy court in Manhattan as he seeks payment of his law firm’s latest $43.2 million bill. Irving Picard says he has recovered a total of…

Apr 20, 2011 12:13 AM CDT

Howrey Creditors Seek Involuntary Chapter 7 Bankruptcy for Law Firm

Three creditors to whom Howrey allegedly owes a total of less than $40,000 have filed a petition in the Northern District of California seeking an involuntary Chapter 7 bankruptcy for Howrey, reports the Am Law Daily. The law firm dissolved last month following an attorney exodus. Bankruptcy partner Peter Gilhuly…

Apr 13, 2011 12:30 PM CDT