Dewey trustee objects to proposed $165,000 bonus

Tracy Hope Davis argues that firm “insider” Frank Canellas must prove that he has another, equally lucrative job offer before receiving any extra cash

Just when you thought Dewey & Leboeuf’s bankruptcy couldn’t get any more contentious, the U.S. bankruptcy trustee in charge of the case objected Thursday to a plan that would reward the estate’s director of finance, Frank Canellas, with a $165,000 bonus.

Joff Mitchell, the firm’s chief restructuring officer, had proposed paying bonuses to Canellas and two other employees to keep them from leaving the firm. But U.S. Bankruptcy Trustee Tracy Hope Davis objected to Canellas’ bonus, which was significantly larger than the other two, arguing that he was an “insider” in Dewey’s former management team. According to Davis, under bankruptcy code insiders cannot receive bonuses unless they have a “bona fide job offer from another business at the same or greater rate of compensation.” She also noted that, with the bonus, Canellas stands to earn $665,000 in 2012, more than the $615,000 he made when the firm was still operational in 2011.

Alanna Byrne

Bio and more articles

Join the Conversation

Advertisement. Closing in 15 seconds.