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A federal judicial ethics probe into former U.S. Bankruptcy Judge David Jones's failure to disclose his romantic relationship with a lawyer whose firm regularly appeared before him has come to an end following the Houston judge's resignation, Reuters reported. The chief judge of the 5th U.S. Circuit Court of Appeals, Priscilla Richman, in an order on Wednesday said that further action was "unnecessary" after Jones last month submitted his resignation as a Southern District of Texas bankruptcy judge. Jones announced plans to resign on Oct. 15 after acknowledging to the Wall Street Journal that he had been in a years-long romantic relationship with bankruptcy attorney Elizabeth Freeman and shared a home with her. Freeman until recently worked at Jackson Walker, a local law firm that worked on many corporate bankruptcy cases in Jones' Houston courthouse. Jones's resignation came shortly after the 5th Circuit had launched an ethics inquiry and Judge Richman's filing on Oct. 13 of a misconduct complaint that found there was probable cause to believe Jones violated the codes of conduct that govern judges. Richman's complaint said Jones never recused himself from cases involving Jackson Walker or disclosed his relationship with Freeman. He also approved attorneys' fees sought by the firm for work on matters in which billing records showed Freeman performed "substantial" services, Judge Richman said.

A Texas bankruptcy judge on Tuesday appointed a new mediator for Tehum Care Services, a bankrupt affiliate of prison health provider YesCare, to revisit its $37 million settlement facilitated in August by former judge David R. Jones, who resigned from the bench last month following an ethics controversy, WSJ Pro Bankruptcy reported. Judge Jones’s resignation followed an official complaint filed by the chief judge of the Fifth Circuit Court of Appeals, stating probable cause existed to believe that Jones had committed misconduct surrounding his undisclosed romantic relationship with bankruptcy lawyer Elizabeth Freeman, whose then-employer Jackson Walker frequently appeared before Judge Jones. Freeman participated in the negotiation representing YesCare when Judge Jones — who served as a court-appointed mediator for the case — mediated the settlement, according to court papers. The Justice Department’s bankruptcy watchdog in its court filings earlier this month expressed concerns over the “propriety of the mediation that serves as the basis for the global settlement.” A few days after Jones’s resignation, Judge Christopher Lopez with the U.S. Bankruptcy Court in Houston, who has been overseeing the YesCare affiliate bankruptcy proceeding, declined to approve the framework of the company’s bankruptcy exit plan on an expedited basis and instructed the parties to “rethink” the proposal, which was built upon the global settlement. Judge Lopez at that time said he wasn’t questioning the integrity of the mediation, but the proposal didn’t provide enough information for him to approve it. Lawyers of the YesCare affiliate and other stakeholders recently petitioned Judge Lopez to appoint Christopher Sontchi, a retired Delaware bankruptcy judge, as a new mediator to look at the case “clean and fresh.”

Texas law firm Jackson Walker said in court documents yesterday that its former partner Elizabeth Freeman lied about her romantic relationship with David R. Jones, a bankruptcy judge who was presiding over cases in which Freeman was billing hours, WSJ Pro Bankruptcy reported. Jackson Walker began to investigate the matter after a shareholder involved in one of the bankruptcy cases alleged in March 2021 that Freeman and Jones were in a romantic relationship, the law firm said. At the time, it also immediately notified the Southern District of Texas Bankruptcy Court, the firm said. The filings were in response to a recent request made by the U.S. Trustee Program, urging the court to reverse prior orders awarding about $13 million in legal fees to Jackson Walker for its work in more than two dozen chapter 11 cases before Jones, including about $1 million in fees billed by Freeman. In a court filing Monday, Jackson Walker provided an email exchange from August 2021, in which Freeman said that she agreed with a draft letter prepared by the law firm that stated she and Jones were “close personal friends” stemming from when they worked together at another law firm, and “there has been no romantic relationship since prior to the time in March 2020 when COVID caused so many of us to shift to remote work and virtual-only meetings.” Freeman “confirmed that there is no current romantic relationship between herself and Judge Jones and that none is expected going forward,” the letter that she agreed to said. “They’re throwing her under the bus,” said Nancy Rapoport, a law professor at the William S. Boyd School of Law at the University of Nevada, Las Vegas, who specializes in bankruptcy ethics, adding she thinks Jackson Walker still has more questions to answer. “Didn’t they know from any independent means that she might be lying?”