It seems as though no one’s happy with Dewey & LeBoeuf these days: not creditors, not regulators and certainly not its former partners, who may be on the hook for the firm’s massive debts.
Last week, the firm proposed a settlement that would release former partners from claims by creditors, in exchange for payments of between $25,000 and $3 million. The defunct Dewey owes $315 million to creditors; the settlement, if accepted, would cover up to $103.6 million of that amount.
But some Dewey retirees aren’t rushing to open their wallets, according to the Wall Street Journal. A group of 53 retirees has spoken out against the deal, arguing that the $3 million cap favors highly paid partners—some of whom made more than $6 million annually. Also controversial is the fact that the settlement would prevent lawsuits against former Dewey executives, who some partners blame for mismanaging the firm’s finances.
The group’s attorney, Annette Jarvis of Dorsey & Whitney, told WSJ that her clients are unanimously opposed to the proposed settlement. In a statement Tuesday, Jarvis called the plan “nothing more than a flagrant attempt by the grossly over-compensated partners who ran the firm into the ground to escape liability for their own conduct.”
Read more on the story at the Wall Street Journal.
For more InsideCounsel coverage of the Dewey & LeBoeuf saga, see the following: