Ethics and Professional Compensation

In re Wireless Telecommunications Inc. Court Weighs in on Allowance of Professional Fees, Approves 12% Voluntary Reduction by Debtors’ Counsel

Creditors and parties in interest frequently file objections to bankruptcy professionals’ fee requests incurred during the case. According to the U.S. Trustee’s Annual Report of Significant Accomplishments for FY 2009, [1] the U.S. Trustee alone filed 511 objections to the allowance of professional fees in 2009 (the last year reported as of the date of this article), and 91.9 percent of which were successful, lowering the total amount of fees awarded in those cases by $28,524,879.

The Ninth Circuit Upholds Sanctions for the Improper Removal of State Court Litigation

The Ninth Circuit recently upheld a motion for sanctions against an attorney and his law firm for improperly removing a case. This raises the question of whether there is a trend of courts developing less tolerance for aggressive litigation tactics or whether this was an isolated incident where the facts justified the application of sanctions at any period of time.

To Agree or Not to Agree: That Is a Civil Question [1]

The Bard of Avon expressed a variety of views on the legal profession.

Some Local Flavor on the Role of Local Counsel in Large Bankruptcy Cases

On Dec. 2, 2009, perceptive lawyers may have noticed a small disturbance in the force.

Common Discovery Abuse Games: Who Said Lawyers Don’t Like to Have Fun?

Many cases are won or lost on discovery. Ironically, this key aspect of litigation is typically subject to minimal judicial control, and lawyers are instead often left to comport themselves in the discovery process with civility, honor and integrity. Unfortunately, it appears that lawyers are increasingly encountering discovery abuse in civil litigation, resulting in more and more judges imposing sanctions—including the ultimate sanction of default judgment in the nonoffending party’s favor—for such abuse.

What are Your Obligations in Dealing with Unrepresented Parties?

Bankruptcy lawyers often deal with unrepresented persons. For example, in more than 10 percent of consumer cases, the debtor has no lawyer. [1] Counsel for an unrepresented debtor’s secured creditors may have dealings with the debtor regarding motions for relief from stay or reaffirmation agreements. Likewise, lawyers who represent consumer debtors may have dealings with unrepresented creditors regarding filing proof of claims or reaffirmation agreements or other bankruptcy matters.

Does Civility Temper Zealous Legal Advocacy? To Better Serve Clients and the Profession, Concepts Can (and Should) Co-Exist

Webster’s Dictionary defines “zeal” as “eagerness and ardent interest in pursuit of something.” Zeal has initiated much debate among legal professionals. What does it mean to be a zealous advocate? Is zealous advocacy even permissible in today’s practice of law?

Seventh Circuit Denies Fees to Breaching DIP Lender

The Seventh Circuit affirmed a district court’s ruling that a debtor-in-possession (DIP) lender had breached its financing agreement, barring its claim for commitment and funding fees from the DIP. [1] Although the DIP itself had also breached the agreement, that breach was not, in the court’s view, effective until after the lender had already “walked away.” [2] Since the lender first breached the agreement, it could not now recover the fees from the DIP.

Corporate Insolvency and Director and Officer Fiduciary Duties: What’s a Lawyer to Do?

The Professional Ethics Committee for the State Bar of Texas recently issued Opinion No. 603 regarding a lawyer’s duties when he or she represents an insolvent corporation. The opinion was based on a situation [1] in which the company’s sole shareholder was also its sole officer and sole director, engaging in conduct that the company lawyer concluded breached her fiduciary duties to the company.

Should Judges ‘Friend’ You? Judicial Ethics in the Age of Social Media

Social media transformed the way people communicate and interact with one another. With close to 500 million active users, half of whom login daily and maintain an average of 130 friends, Facebook is the leader among social media platforms. [1] Nearly one-fifth of Facebook’s active user population is found in the United States, which equates to one-third of the country’s total population.

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