Bankruptcy Judge Dennis Montali in San Francisco said last week that he will allow a direct appeal to the Ninth Circuit from one of his rulings in the bankruptcy of Howrey LLP, skipping an intermediate appeal to the U.S. District Court.  The judge relied on Jewel v. Boxer — a California state law case which holds that profit earned on unfinished business after dissolution belongs to the “old” firm, not to a newly-formed firm that completed the work.

In recent cases where lawyers have signed proofs of claim for their clients and litigation ensued, the signing attorneys were deposed with respect to the facts surrounding submission of the claims.  For some time, an attorney who signed a proof of claim on his client’s behalf has been risking disqualification or being called as a fact witness concerning the factual basis for the claim in related litigation.

If the summer whizzed by too fast and you are still using your old Circular 230 disclaimer on emails and correspondence, it is time to fix that.

In a unanimous decision, the New York Court of Appeals stuck a dagger through the heart of bankruptcy estates of failed law firms as it declared that profits earned on matters that former partners of the failed firm take with them to their new employers are not property of the former firm.  Those profits belong to the new firm that provides the legal services.

The Order Re Summary Judgment issued on June 11, 2014 by Judge Charles R. Breyer of the U.S. District Court for the Northern District of California in the Heller Ehrman LLP bankruptcy case may prove to be a knock-out punch against “unfinished business” claims by insolvent or bankrupt law firms and their trustees.

Which law firm is rumored to be failing this week, and who will be next? Although, inevitably, the target firms insist that retaining bankruptcy counsel does not mean a filing is imminent, such legal industry headlines are catnip for strong firms hoping to bolster their own talent by luring lateral hires away from weak ones. With those opportunities, however, comes the real risk of being sued later by the failed firm’s bankruptcy trustee.

Bankruptcy Court Holds Attorney's Signature on Proof of Claim Form Renders Attorney a Fact Witness to Allegations in Proof of Claim, Waiving Attorney-Client and Work-Product Privileges

The Supreme Court of the United States announced decisions in three cases today:

Large law firm failures typically produce lengthy and litigious bankruptcy cases. A frustrated lawyer in one such case succinctly described the essential problem: “the assets walk, talk and, worst of all, have their own counsel.” To the inherent tensions and creditor demands of any large chapter 11 case are added  the raw pain, similar to divorce, that many partners feel at the downfall of an institutio

On May 24, 2012, the United States District Court for the Southern District of New York (District Court) issued an opinion with significant ramifications for law firms seeking to hire former partners from bankrupt law firms. At issue was whether, under New York partnership law, the law firms that hired former partners of Coudert Brothers LLP (Coudert), a dissolved and bankrupt law partnership, must account for profits that the former Coudert partners earned while completing work on open client matters they took with them from Coudert.