Home

Update on Dewey & LeBoeuf Bankruptcy
Download PDF
1 Star2 Stars3 Stars4 Stars5 Stars (No Ratings Yet)
Loading...

On August 29, 2012, the advisers for Dewey & LeBoeuf filed an onslaught of motions to stay in control of the Dewey & LeBoeuf bankruptcy case, and to win court approval of a proposed settlement with former partners, The Am Law Daily reported.

The law firm filed for Chapter 11 protection on May 28, 2012. Chapter 11 of the Bankruptcy Code is usually referred to as “reorganization.” Bankruptcy does not guarantee a debtor gets to keep its assets, but it can buy time for the debtor to resolve its debts with creditors or save cash from discharged debts that can be reallocated to pay taxes or guaranteed debts.

  
What
Where


Dewey is one of the largest law firms to fail. According to a Dewey bankruptcy counsel, a proposed partner contribution plan with partners involves $89 million from 670 former partners in exchange for a waiver of Dewey-related liability. The plan was difficult for partners to agree to. Many of them were attempting to revive their careers, and had loans from capital contributions to the firm.  Ex-partners might suffer potentially negative tax consequences from the firm’s bankruptcy.

In bankruptcy proceedings, a creditor, whose claim the debtor does not list on the bankruptcy schedules, must file a proof of claim. A claim means a right to payment, or a right to an equitable remedy for a contract performance failure, if the breach raises a right to payment. Court filings indicate Dewey owed around $250 million in secured debt and at least $300 million more in unsecured claims.

Court filings showed commitments of more than $71 million from approximately 430 former Dewey partners were gathered for the proposed settlement.  According The Am Law Daily on one of the motions, Dewey bankruptcy counsel argued:  “It provides certainty. It allows partners to go on with their lives and for creditors to get a quick return on their claims. It avoids years of litigation that would clog the Bankruptcy Court’s already crowded calendar.”

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!!




In another  set of motions filed August 29, 2012, the primary secured lender of the Dewey estate, JPMorgan Chase, opposed efforts by an ad hoc committee of 54 retired partners and some spouses from Dewey predecessor firm LeBoeuf, Lamb, Greene & MacRae, to have a trustee or neutral examiner in charge of the bankruptcy. A Brown Rudnick partner who is advising the official creditors committee, said to the media:  “And I understand there are emotional issues here, but the fact of the matter is, this filing was motivated to prevent them from having to pony up a settlement amount. . . . There’s no way the appointment of a trustee or examiner benefits anybody in the estate at this stage.”

September 20, 2012 is probably the next moment in the law firm’s bankruptcy proceedings.  A U.S. Bankruptcy Judge is scheduled to rule on requests to assign the case to a trustee and to approve the partner contribution plan.





 

Interesting Legal Sites You May Like


BCG FEATURED JOB

Locations:

Keyword:



Search Now

Mid-level Tax Associate Attorney

USA-CA-Los Angeles

Los Angeles office of an AmLaw firm seeks mid-level tax associate attorney with 3-5 years of experie...

Apply Now

Real Estate/Transactional Attorney

USA-PA-Camp Hill

Camp Hill office of our client seeks real estate/transactional attorney with experience. The candida...

Apply Now

Corporate Attorney

USA-WY-Laramie

Laramie office of our client seeks corporate attorney with 2+ years of experience.

Apply Now

RELEVANT JOBS

Legal Assistant / Paralegal

USA-FL-Tavares

Tavares boutique and growing law firm is looking for a full-time legal assistant / paralegal to work...

Apply now

Litigation Associate Attorney

USA-CA-San Francisco

Andrus Anderson LLP is a plaintiffs’ firm in San Francisco looking for a full-time associate w...

Apply now

Maine Litigation Attorney

USA-ME-Portland

Busy New England business law firm seeks Maine Litigation Attorney based in our Portland, Maine offi...

Apply now

Maine Foreclosure Attorney Operations Manager

USA-ME-Portland

Bendett & McHugh is looking for a strong Foreclosure Attorney Operations Manager for our Maine Forec...

Apply now

SEARCH IN ARCHIVE

To Top