As of next year, former Dewey & LeBoeuf chairman Steven Davis—faulted by many both inside and outside the firm as the chief culprit in its collapse—is to begin chipping away at the $511,145 he has agreed to give the Dewey estate to help satisfy creditors under a broader settlement that protects him against potential mismanagement claims, American Lawyer Daily reported today. Unlike more than 500 other former partners who were required to make payments to the defunct firm’s estate by early April in exchange for a release from Dewey-related liability, Davis has considerably more time to meet his obligations. Starting on March 22, 2014, court filings show, he must pay the estate a sum equal to 8 percent of his annual earnings each year for the next six years. Any outstanding balance will accrue interest at a rate of 9 percent annually. Once that March 2019 payment is made, though, whatever debt Davis still owes will be wiped away, according to a promissory note filed in bankruptcy court on April 22 as part of the proposed settlement between Davis, the Dewey estate, and XL Specialty Insurance. For its part, XL, which issued Dewey’s $25 million management liability policy, has pledged to pay the estate the $19 million not yet spent covering legal defense costs. XL has 10 days from when the settlement, which requires court approval, becomes final to make its payment to the estate.
