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While the Archdiocese of Agana has yet to compensate nearly 300 Guam clergy sex abuse survivors, it has already paid or been ordered to pay some $3.9 million of the $4.38 million in attorneys' and real estate professionals' fees and costs in its nearly two-year bankruptcy case, the Guam Daily Post reported. These figures are based on a review of proposed, awarded and paid amounts contained in documents filed in the District Court of Guam in 2019 and 2020. The numbers include recent fourth interim fee applications that the federal court will hear in January, amounting to about $480,601. The fourth interim fee applications cover bills for services rendered only from Aug. 1 to Nov. 30, 2020. After review and scrutiny of the proposed billings, inclusive of fees and reimbursable costs, District Court Chief Judge Frances Tydingco-Gatewood reduced many of the amounts from the first three billing cycles, saying the higher the legal fees, the lower the amount that could go to clergy sex abuse survivors. Other defendants in clergy sex abuse cases — including the Sisters of Mercy, the Capuchin Franciscans and the Boy Scouts of America — already have settled with some of the abuse survivors. The settlement amounts have been kept confidential. The archdiocese and other defendants are still in mediation to try to settle the abuse lawsuits, and the billing meters will continue to tick. If settlements fail, the clergy sex abuse lawsuits against the archdiocese could go to trial.

Bankruptcy Judge David Jones yesterday approved McKinsey & Co.’s settlement with Justice Department watchdogs over how the firm discloses potential conflicts of interest, effectively ending a legal battle on transparency in the U.S. bankruptcy system, WSJ Pro Bankruptcy reported. Under the settlement, announced earlier this month, McKinsey agreed to walk away from about $8 million in fees for work it did helping navigate Westmoreland Coal Co. through a 2018 chapter 11 filing. McKinsey didn’t admit to any wrongdoing but agreed to broaden the scope of disclosures made in future cases, including the names of confidential clients and potential conflicts involving its many affiliates. In return, the Justice Department agreed to drop an objection it filed in the Westmoreland case alleging McKinsey’s disclosures were legally insufficient. The settlement is the latest in several multimillion-dollar deals in recent years tied to questions about McKinsey’s disclosure practices. Bankruptcy advisers legally are required to be disinterested and to disclose connections that could give rise to a conflict of interest.

McKinsey & Co. agreed to forgo roughly $8 million in fees from advising a bankrupt Colorado coal miner after reaching a settlement with Justice Department watchdogs over concerns about the firm’s disclosure of possible conflicts of interest, WSJ Pro Bankruptcy reported. Under the deal announced yesterday, McKinsey agreed to withdraw an application to work as an adviser to Westmoreland Coal Co. on its 2018 bankruptcy filing. McKinsey also agreed to broaden the scope of disclosures made in future bankruptcy cases, including the names of confidential clients. In return, the Justice Department agreed to drop an objection it filed in the Westmoreland case alleging that McKinsey’s disclosures were at odds with the law. “This settlement ensures that McKinsey is held accountable for its conduct in this case,” said Cliff White, director of the U.S. Trustee Program. The deal won’t become final unless it wins approval from Judge David Jones of the U.S. Bankruptcy Court in Houston, who has been overseeing the Westmoreland case and long-running litigation related to McKinsey’s disclosure practices. The settlement was reached with the help of Judge Marvin Isgur, another Houston-based bankruptcy judge, who served as a mediator between McKinsey and the Justice Department. McKinsey didn’t admit wrongdoing as part of the settlement. It isn’t clear how the settlement will affect ongoing litigation against McKinsey in the Westmoreland case brought by Jay Alix, the retired founder of rival corporate turnaround firm AlixPartners LLP. A trial on Alix’s claims that McKinsey flouted disclosure laws was set to resume next month after being halted over the coronavirus pandemic. Alix, whose claims aren’t covered by the Justice Department settlement, has targeted McKinsey over its roles in a number of large bankruptcy cases, especially in how it disclosed information about the billions of dollars it invests on behalf of current and former employees. In addition to the fees McKinsey agreed to walk away from in the Westmoreland case, court papers show the firm has paid some $32.5 million in settlements related to its past bankruptcy disclosure practices, including a separate $15 million settlement in 2019 with the U.S. Trustee. McKinsey also didn’t admit any wrongdoing under that agreement.