Sept. 17 (Bloomberg) -- The top three former executives at Dewey & LeBoeuf LLP, the defunct law firm, filed objections to aspects of the proposed settlements with about 400 partners designed to bring in $71 million.
Steven Davis, the former chairman; Stephen DiCarmine, the former executive director, and Joel Sanders, the ex-chief financial officer, said last week that it’s improper that releases under the settlements end up making them solely liable for the firm’s failure.
The law doesn’t permit the settlements to eliminate their rights to have liability for only their “proportionate share” of damages, the three ex-executives said in a filing in U.S. Bankruptcy Court in Manhattan. They also object to making secret the identities of the settling partners, saying they need to know who settled in preparing their defenses.
The firm’s former leaders also want the bankruptcy judge to strike a provision that would prevent settling partners from helping them fight lawsuits. The settlements come up for approval at a Sept. 20 hearing.
Several former partners have a motion scheduled for hearing that day asking the judge to appoint a Chapter 11 trustee. The official committee representing partners instead advocates having an examiner perform an investigation before settlements are approved.
Dewey once had 1,300 lawyers before liquidation began under Chapter 11 in May. The petition listed assets of $193 million and liabilities of $245.4 million as of April 30.
The case is In re Dewey & LeBoeuf LLP, 12-12321, U.S. Bankruptcy Court, Southern District of New York (Manhattan).
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