The long slow slog that is Dewey & LeBoeuf’s bankruptcy will continue for a little while longer, as the firm has once again pushed back the deadline to reach a clawback settlement with former partners.
Dewey had already extended the deadline from July 26 to Aug. 7 to revise the settlement, under which partners would pay between $5,000 and $3.3 million to be released from future lawsuits brought by creditors or other ex-employees. In an email to partners Monday, the firm said that it will make “some enhancements” to the current proposal and circulate an updated version soon. Partners now have until Aug. 13 to sign on to the deal, which could earn the firm up to $90.4 million.
The initial clawback settlement met with resistance from many former partners, who argued that it favored more highly paid partners and shielded firm management from any claims of wrongdoing. In response, Dewey’s estate upped the potential contribution for top earners, lowered the minimum payment for other employees and called for executives to pay an additional 20 percent premium. But some ex-employees are still concerned that the deal may prevent them from suing the firm for compensation or frozen retirement funds, according to the Wall Street Journal.
The firm has also come under fire for its plans to pay remaining employees up to $700,000 in bonus and retention pay, and for shelling out millions of dollars to some high-ranking employees in the months leading up to its bankruptcy.
Read more on the settlement at the Wall Street Journal and Reuters.
For more InsideCounsel coverage of Dewey, see the following:
Bankruptcy judge Oks most of Dewey’s $700,000 bonus plan
Time winding down on Dewey & LeBoeuf’s new clawback proposal
Dewey & LeBoeuf offers new settlement to ex-partners
Dissecting Dewey’s money management
Dewey paid executive partner $190,000 after bankruptcy filing
Dewey to revise proposed clawback settlement with ex-partners
Dewey offers former partners a deal
Dewey looks to pay remaining staff $700,000 in bonuses
Former Dewey partner sues management, claims they were “running a Ponzi scheme”
