Is a Successor Trustee Shortchanged in Apportioning Commissions?
Judges exercise considerable discretion in apportioning commissions among two trustees.
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Analysis: Proposed DOJ Bankruptcy Fee Overhaul Would Hike Costs for Large Chapter 11 Debtors
The U.S. Trustee Program is proposing adjustments to quarterly fees for the largest chapter 11 debtors, TheStreet.com reported on Friday. The new structure would switch most payments to a percentage of disbursements instead of the current flat rate scheme and would significantly increase costs on the biggest-ticket cases. The proposed fee structure would increase quarterly fees paid by chapter 11 debtors with quarterly disbursements of at least $1 million to an amount equal to 1 percent of disbursements or $250,000, whichever is less. Beginning in 2021, the director would be permitted to adjust the fee once a year. Quarterly fees are currently set at a fixed amount, with the highest a debtor can owe being $30,000 per quarter for those whose quarterly disbursements top $30 million. The U.S. Trustee Program estimates that the fee increase would result in $289 million in revenue in 2018, $150 million more than what it would be under the current system. A DOJ spokesman said that cases with quarterly disbursements under $1 million are excluded from the proposed adjustment to ensure small businesses don't pay additional fees."It seems to go a pretty good way of making sure it's not affecting small businesses and organizations," said Anthony Casey, a professor of law at the University of Chicago Law School and former associate at Wachtell, Lipton, Rosen & Katz.
After Chapter 13 Dismissal, Counsel Fees Aren’t Paid
Harris v. Viegelahn extended from chapter 13 conversions to dismissals.
Judge Name - Do not use it.
Jeffrey P. Norman
Iowa Bankruptcy Judge Scolds Weil Gotshal over High Fees
An Iowa judge overseeing the bankruptcy of aerospace-parts manufacturer Wellman Dynamics Corp. called a legal bill from Weil, Gotshal & Manges “staggering” and cut the firm’s million-dollar payment in half, The Wall Street Journal reported yesterday. Judge Anita Shodeen said the New York law firm charged an unreasonable amount of money for work on the struggling manufacturer’s bankruptcy during September and October. The firm represents the company’s biggest lender, a TerraMar Capital affiliate, which is owed more than $30 million and has fought to purchase its operations. “Based simply upon the number of attorneys and hours billed leads to the inherent conclusion that there was a distinct lack of billing judgment” by the firm, she wrote. The ruling said the firm could charge roughly half of its $1,040,591.92 bill. The borrowing deal between Wellman Dynamics and the TerraMar Capital affiliate says that Wellman Dynamics has to cover the lender’s attorney’s fees and expenses. During a hearing in January, a lawyer in the U.S. Trustee’s Program called the bill from Weil “the most overblown fee application I’ve ever seen in the Southern District of Iowa.” With 16 lawyers involved, the firm billed for nearly 100 hours’ worth of “interoffice communications” among them. The firm previously defended the billing hours, saying that the bankruptcy case is complex and required time to evaluate Wellman Dynamics’ property value and financial problems. “In comparison to any other large chapter 11 case, Weil’s description of [the company’s] case as exceedingly complex … is overstated,” Judge Shodeen said.
Bankruptcy Code