Home

Departing Heller Ehrman Partners Paid $7 Million
Download PDF
1 Star2 Stars3 Stars4 Stars5 Stars (No Ratings Yet)
Loading...

Bankrupt law firm Heller Ehrman paid out more than $7 million to 35 departing or retiring partners in 2008.

The departures led to the firm breaking a loan covenant and having its accounts frozen, which precipitated its collapse.

The document also shows who Heller’s creditors could target as they seek to be paid through Heller’s bankruptcy. Creditors can try to reclaim payments dating back as far as four years.

  
What
Where


Thomas Willoughby of Felderstein Fitzgerald Willoughby & Pascuzzi, who represents the creditors, says he will be looking at any payments that were made when the estate was insolvent, or distributions that “led to it being insolvent.”

The majority of the distributions, $5.3 million, went to 13 lawyers who received all of their capital because of a “change of status or termination.” The highest distribution went to senior of counsel Douglas Schwab, who received $920,000. Schwab retired in 2008 and was at Heller for more than 35 years.

Dissolution committee member Paul Sugarman and received $513,000.

Get JD Journal in Your Mail

Subscribe to our FREE daily news alerts and get the latest updates on the most happening events in the legal, business, and celebrity world. You also get your daily dose of humor and entertainment!!




Some partners collected 25% of their investment in the firm, and 40 of them collectively left behind $8 million in capital. Lawrence Hobel is out the most cash, with $573,000 left behind.

To accumulate capital, Heller would withhold between 7 and 8.5% per year of each partner’s profits, and withholdings would stop after a maximum was reached. A partner reaching 65 and retiring or switching to senior status received all capital back.



Firms often take years to pay back capital contributions to partners who leave for other firms. In Heller’s case in 2008, partners were paid 25% of their capital upon departure, with the expectation that 25% a year would be distributed over the following three years. By June 1, however, the policy changed and partners who moved were told they would not begin to be paid until 2009.

Summary:

Law firm Heller Ehrman pays out more than $7-million to 35 departing or retiring partners in 2008 and goes bankrupt. The law firm’s bankruptcy amounting to $5.3 million went to 13 lawyers who received all of their capital because of change of status or termination and the highest went to Douglas Schwab, who received $920,000 during his retirement in 2008, and served at Heller for more than 35 years.



 

Interesting Legal Sites You May Like


BCG FEATURED JOB

Locations:

Keyword:



Search Now

Civil Litigation Associate Attorney

USA-FL-Coral Gables

Coral Gables office of our client seeks civil litigation associate attorney with 3+ years of experie...

Apply Now

Family Law Attorney

USA-UT-Ogden

Ogden office of our client seeks family law attorney with 2+ years of experience. The candidate will...

Apply Now

Insurance Defense Litigation Attorney

USA-FL-Boca Raton

Boca Raton office of our client seeks attorney with 5+ years of insurance defense litigation experie...

Apply Now

RELEVANT JOBS

Attorney

USA-MO-Jefferson City

Successful, expanding law firm of 21 years seeks an attorney with 3+ years experience. The atto...

Apply now

Associate Attorney

USA-MD-Chevy Chase

Why join Delaney McKinney?   Join a passionate, dedicated, and engaged multi-generat...

Apply now

Attorney At Law

USA-MI-East Lansing

Established, prominent defense law firm seeking qualified attorneys in East Lansing, MI to join our ...

Apply now

Paralegal III - Labor & Employment

USA-TX-Katy

Job Description: Education: High School Diploma or equivalent required Bachelor’s d...

Apply now

SEARCH IN ARCHIVE

To Top