The chief bankruptcy judge for the Southern District of Texas has set a new trial date in the litigation over whether the U.S. trustee can claw back millions in fees awarded to Jackson Walker by former judge David Jones.
Chief U.S. Bankruptcy Judge Eduardo V. Rodriguez issued an order Tuesday scheduling trial to begin April 21, pushing back what had been a mid-December trial setting. The U.S. trustee has identified 33 cases in which former judge David Jones served as judge or mediator where Jackson Walker and its former partner Elizabeth Freeman were awarded fees totaling about $18 million — fees that the U.S. trustee is attempting to claw back. Jones resigned from the bench in October when his relationship with Freeman was publicly reported. Freeman was asked to leave the partnership in 2021 after admitting to the firm the relationship existed.
Attorneys for Jackson Walker and the U.S. trustee told the court they expected trial in the case will last 10 days. Judge Rodriguez set aside two weeks for the proceeding.
“I’m going to hold a trial on the merits on every portion of these Rule 60 motions … we’re going to have one consolidated trial that deals with vacatur and all of the relief the US trustee is seeking in all of the cases,” Judge Rodriguez told the parties during the roughly 80-minute hearing, referencing the U.S. trustee’s motions to undo Jones’ rulings in the 33 cases.
After that trial — which will determine whether Jones’ orders awarding fees can be vacated and whether Jackson Walker can be sanctioned — takes place, Judge Rodriguez said the cases would be returned to the various presiding judges handling the 33 cases to determine two other issues: whether those fees can be disgorged (and if so, where that money would go) and whether any of those judges should be disqualified from presiding over the cases under 28 U.S. Code § 455.
The 455 issue, Judge Rodriguez said, “has wider implications.”
“Assuming there’s a finding under 455 … that the presiding judge had no authority to enter any orders in the case,” he said. “That has extremely broad implications, and that’s just one case — multiply that across 33. I’m having trouble understanding why the court should entertain such a matter when the court can more than likely dispose of these matters given all the other bases the U.S. trustee has raised in its Rule 60 motions.”
“These are matters that would have broad, running implications in the entire case, and I think it would wreak havoc across the district if something like that would happen in one case, much less 33.”