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Lawyers focusing on corporate bankruptcy matters, especially those who work at firms with a large national presence, often represent clients throughout the country and are commonly admitted to practice in more than one jurisdiction. Further, bankruptcy attorneys often blend their practice with bankruptcy court litigation and out-of-court restructuring and transactional matters.
After a significant amount of litigation including an appeal, remand and trial over a two-year period, the bankruptcy court overseeing In re River Road Hotel Partners LLC[1] ultimately determined that FBR Capital Markets & Co., located in Arlington, Va. (FBR), was entitled to payment of its restructuring fee of $2,666,965.73 and expenses of $12,179.01.
Lawyers focusing on corporate bankruptcy matters, especially those who work at firms with a large national presence, often represent clients throughout the country and are commonly admitted to practice in more than one jurisdiction. Further, bankruptcy attorneys often blend their practice with bankruptcy court litigation and out-of-court restructuring and transactional matters. So what happens when a dual-licensed bankruptcy attorney handling a non-court matter is subject to a state’s disciplinary authority? Which jurisdictional rules will govern that attorney’s conduct?
After a significant amount of litigation including an appeal, remand and trial over a two-year period, the bankruptcy court overseeing In re River Road Hotel Partners LLC[1] ultimately determined that FBR Capital Markets & Co., located in Arlington, Va. (FBR), was entitled to payment of its restructuring fee of $2,666,965.73 and expenses of $12,179.01. FBR’s engagement letter with the debtors from 2009 called for a restructuring fee based on the percentage of indebtedness involved in any restructuring.
During 2015, the Ethics & Professional Compensation Committee offered three opportunities for ABI members to learn about timely and interesting ethical and compensation issues facing professionals in the bankruptcy arena. At the Annual Spring Meeting, we paired with the Bankruptcy Litigation Committee to explore the inner-workings of “Trustee Selection in Commercial Bankruptcy Cases: Who Wins the Battle to Control the Estate.” The panel was moderated by Eve H. Karasik (Levene, Neale, Bender, Yoo & Brill; Los Angeles, CA) and consisted of Ramona D.
The recent decision in Sabatini Frozen LLC v. Weinberg, Gross, & Pergament LLP[1] is a tale of a failure of corporate governance of a closely-held corporation, coupled with the failure of debtor’s counsel to adequately address that matter. The decision also illustrates the real limitations on a “wronged” creditor’s recourse against debtor’s counsel for counsel’s conduct during a bankruptcy case.
Under 11 U.S.C. § 330(a)(3)(F), professionals seeking payment from a bankruptcy estate must be compensated using reasonable rates and fees charged by comparably skilled professionals in nonbankruptcy cases. Prompted by the size of the professional fees in large chapter 11 filings, the General Accounting Office (GAO) was asked by the U.S. Senate Judiciary Committee to evaluate whether bankruptcy professionals billed higher fees for large chapter 11 cases, and if
In Pham v. Golden,[1] the Ninth Circuit Bankruptcy Appellate Panel (BAP) reversed an award of sanctions against the debtors and their counsel for discovery abuses in an adversary in which the debtors were not parties. In doing so, the court limited or invalidated several local rules that provided the basis for the bankruptcy court’s award of sanctions.
A recent decision from the U.S. Bankruptcy Court for the Eastern District of California confirms what many bankruptcy attorneys have long suspected: A debtor’s bad conduct in bankruptcy may serve to defeat a fee waiver for a debtor who otherwise qualifies under the income guidelines. In In re Gjerde, the debtor, Sean Patrick Gjerde, was a disbarred
Bankruptcy courts are vested with the inherent and statutory authority to sanction litigants for acting in bad faith and engaging in otherwise unreasonable or inappropriate conduct.
