Bill on Bankruptcy: Fee Agreement Puts Law Firm In Trustee's Sights

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Jan. 9 (Bloomberg) -- Law firm Kaye Scholer LLP and financial advisor Capstone Advisory Group LLC are in the sights of a U.S. Trustee aiming to claw back $12 million for an undisclosed agreement to share fees awarded in the now-completed bankruptcy of GSC Group Inc. On their new video, Bloomberg Law's Lee Pacchia and Bloomberg News bankruptcy columnist Bill Rochelle pose the question of whether the dispute involves a serious ethical lapse or a hypertechnical reading of an ambiguous statute. See more +
Jan. 9 (Bloomberg) -- Law firm Kaye Scholer LLP and financial advisor Capstone Advisory Group LLC are in the sights of a U.S. Trustee aiming to claw back $12 million for an undisclosed agreement to share fees awarded in the now-completed bankruptcy of GSC Group Inc. On their new video, Bloomberg Law's Lee Pacchia and Bloomberg News bankruptcy columnist Bill Rochelle pose the question of whether the dispute involves a serious ethical lapse or a hypertechnical reading of an ambiguous statute.

The effort by Lehman Brothers Holdings Inc. to avoid real estate recording taxes and AMR Corp.'s admission that the holding company may be solvent are the next topics of conversation.

Rochelle provides a rundown on bankruptcy filings statistics for 2012 showing another dramatic decline in all categories including individual, corporate, and small business.

The video ends with discussion of two important new cases. First, Rochelle explains how a federal district judge in Chicago, writing a decision in the liquidation of defunct money manager Sentinel Management Group Inc., is the first to find a major loophole in the so-called securities safe harbor under Section 546(e) of the Bankruptcy Code. Finally, a decision by U.S. Bankruptcy Judge Robert D. Drain in New York who issued an opinion in the liquidation of Hostess Brands Inc. that differs in some respects with rulings by other judges on the treatment of arbitration agreements in Chapter 11. See less -

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