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Houston Bankruptcy Judge Resigns Under Misconduct Investigation

Submitted by jhartgen@abi.org on

Bankruptcy Judge David R. Jones resigned from the bench while under a misconduct investigation by a federal appeals court over his failure to disclose his yearslong romantic relationship with a bankruptcy lawyer who had business before his court, WSJ Pro Bankruptcy reported. Judge Jones’s resignation from the U.S. Bankruptcy Court in Houston comes after the appellate court that appointed him found probable cause that he committed misconduct by failing to disclose his romantic relationship with bankruptcy lawyer Elizabeth Freeman. Jones told the Wall Street Journal earlier this month that he and Freeman have been in a relationship for years and live together at a home in the Houston area. Neither Judge Jones nor Freeman had previously disclosed their relationship in court while Freeman worked on major corporate reorganizations that he oversaw. “I have always said that the bankruptcy process should be about the participants and the preservation of jobs,” Jones said on Sunday. “I have become a distraction to the good work that the court does. To end that distraction and hopefully return focus, I have resigned.” The bankruptcies that Freeman worked on and that Judge Jones oversaw included some of the largest chapter 11 cases of recent years, such as retailers JCPenney and Neiman Marcus and oil-and-gas driller Chesapeake Energy. In each of those cases and others, Freeman, then a partner at the Texas law firm Jackson Walker, billed hours along with her colleagues for their work representing the companies in bankruptcy, according to chapter 11 records. Judge Jones approved more than $1 million in legal fees billed by Freeman over 16 corporate bankruptcy cases from 2018 to 2021 when they shared an address. Judge Jones had said in a Friday court hearing that he would step down from overseeing large corporate reorganizations, though didn’t say at the time that he was resigning from the bench. Judge Jones faces an ethics investigation by the U.S. Court of Appeals for the Fifth Circuit, which appointed him to the bench in 2011. On Friday, the chief justice of the Fifth Circuit U.S. Court of Appeals filed a complaint against Jones, finding that there was probable cause he had committed misconduct by failing to disclose his relationship with Freeman.