Dewey & LeBoeuf offers new settlement to ex-partners
As promised, Dewey & LeBoeuf presented a revised clawback settlement to its ex-partners Thursday, after an initial proposal met with sharp criticism from some former employees.
July 27, 2012 at 07:48 AM
3 minute read
The original version of this story was published on Law.com
As promised, Dewey & LeBoeuf presented a revised clawback settlement to its ex-partners Thursday, after an initial proposal met with sharp criticism from some former employees.
Specifically, many retirees complained that the original plan favored highly paid employees and executives by putting a $3 million cap on the amount that attorneys could pay to be released from future lawsuits. In response, Dewey lowered the minimum contribution from $25,000 to $5,000 and raised the payment limit from $3 million to $3.5 million. The new proposal would also require the firm's former executives to pay an additional 20 percent premium, though a settlement document noted that the premium did not reflect any wrongdoing by management.
In total, the firm stands to recover $90.4 million in the revised settlement, down from the $103.6 million it previously sought. But Joff Mitchell, Dewey's chief restructuring officer, says the firm may have a better chance of recovering money from partners. “I don't think they were ever going to really write that [$25,000] check, whereas at $5,000, maybe they will,” Mitchell told Reuters. Dewey hopes to collect at least $50 million—out of its reported $315 million debt load—by Aug. 7.
Meanwhile, the bankrupt firm hopes to stem the loss of its remaining employees by offering them up to $750,000 in performance-based and discretionary bonuses. A U.S. bankruptcy trustee rejected the proposal last week, but a bankruptcy judge seemed more amenable to the proposal in a hearing Wednesday.
Read more analysis of the revised settlement at Reuters.
For more InsideCounsel coverage of Dewey & LeBoeuf, read:
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