The U.S. Supreme Court ruled yesterday in Baker Botts LLP v. ASARCO LLC, No. 14-103, that bankruptcy attorneys must bear the expense of defending their fees, Reuters reported yesterday. The 6-3 decision stemmed from the 2005 bankruptcy of ASARCO, a mining and smelting company, and a dispute over the fee awarded to its law firm, Baker Botts. Baker Botts was eventually awarded $117 million for its work, which was considered particularly successful because creditors were repaid in full. However, Baker Botts also wanted to be compensated for the $5.2 million it spent battling for the fee. In a 13-page opinion written by Justice Clarence Thomas, the work of Baker Botts was compared to that of a car mechanic. A car mechanic could charge for preparing an itemized bill but "it would be less natural to describe a subsequent court battle over the bill as part of the 'services rendered' to the customer," Thomas wrote. Therefore, Baker Botts, like the car mechanic, should have to pay to defend the bill, Thomas added.
