Law Firms Position Themselves around Stakeholders in the Death of Dewey

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The bankruptcy proceedings of Dewey & LeBouef can drag on for years and groups of stakeholders are appointing lawyers to represent their interests.

On Monday, Kasowitz, Benson, Torres & Friedman confirmed that they would be representing the official committee of former Dewey partners. The law firm notified the bankruptcy court on Monday.

The head of the bankruptcy and corporate restructuring practice at Brown Rudnick, Edward Weisfelner, confirmed that the firm would be representing the interests of the committee of unsecured creditors of Dewey.

  

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Mark Zauderer, said that his firm, Flemming Zulack Williamson is representing a group of more than 60 former partners of Dewey who are concerned about clawback lawsuits that are already being initiated by the Dewey estate.

In an email to Reuters, Mark wrote, “Any misrepresentations or other wrongdoing by the management of the firm will have to be taken into account … We are not going to sit back and be told that we have to pay the firm money.”

Dewey was one of the largest law firms in the United States, and it filed for bankruptcy protection under Chapter 11 on May 28. The demise of Dewey was spurred by wrong financial decisions, lack of transparency, and unequal treatment of partners.

Contributing factors were a huge partner exodus and a revenue model that saw running expenses being greater than revenue for a long time. This also ensured that the weakness remained suppressed from scrutiny. Long time lenders, who are also in troubles of their own, failed to respond to the crisis at the law firm and refused to re-extend revolving loan agreements. The former chairman came under criminal investigation and last-minute attempts to reorganize the decision making body failed to survive the pressure.

The case is In re: Dewey & LeBoeuf, U.S. Bankruptcy Court, Southern District of New York, No. 12-12321.