Dewey & LeBoeuf has once again extended the deadline for its ex-partners to sign on to a proposed clawback settlement. For the last time—they promise.
Former employees, who were supposed to agree to the settlement by 5 p.m. Tuesday, will now have until 5 p.m. Thursday to sign on to the deal, which would shield them from future lawsuits in exchange for payments of between $5,000 and $3.3 million
The delay allowed lenders, creditors and former partners to make final revisions to the Partner Contribution Plan (PCP), according to an email obtained by the Wall Street Journal. “This final version of the PCP contains a provision for PCP participants to receive releases from the lenders which was not in any of the prior versions,” the email read. “We are now done and this is the final agreement. We will not make any further revisions.”
The settlement already underwent multiple changes, after some former partners complained that it favored highly paid employees and shielded firm management from lawsuits. Dewey stands to gain as much as $90.4 million from the deal, which would go toward paying off its $315 million debt. It must collect at least $50 million for the clawback settlement to succeed.
But some ex-partners are still unhappy with the bankruptcy proceedings. Last week, 54 retired partners and relatives of deceased partners asked a judge to appoint an independent trustee to liquidate the firm, citing concerns that the current team is “acting to shield and protect the partners who controlled Dewey & LeBoeuf prior to the bankruptcy filing and who enriched themselves at the expense of retirees and other lawful creditors.”
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