Defense attorneys for two ex-leaders of Dewey & LeBoeuf said in court papers filed on Friday that unless a trustee’s lawsuit against them is halted in bankruptcy court, they will be forced to depose prosecution witnesses from the criminal case against them, Law.com reported yesterday. Alan Jacobs, the liquidating trustee overseeing the defunct law firm Dewey & LeBoeuf, is seeking to recover more than $21.8 million from former CFO Joel Sanders and former executive director Stephen DiCarmine in a clawback lawsuit in Southern District Bankruptcy Court, Jacobs v. DiCarmine, 13-01765. Earlier this month, Jacobs amended his complaint to add new claims for “actual intent” fraudulent transfers, incorporating details from the criminal indictment and the SEC complaint against former firm leaders, as well as the guilty pleas of seven former Dewey accounting employees. Jacobs said that the circumstances surrounding the firm’s payments to Sanders and DiCarmine reveal “several badges of fraud” and their employment contracts awarded them “exorbitant compensation and required, literally, nothing in return.” Now Sanders and DiCarmine are asking for a stay of the entire clawback suit until the criminal case in Manhattan Supreme Court is resolved.
