In the week since U.S. Bankruptcy Judge Marvin Isgur recused himself from all disputes involving Jackson Walker and the U.S. Trustee — related to the firm’s failure to disclose a former bankruptcy partner had a romantic relationship with a sitting bankruptcy judge — they have been officially reassigned to other bankruptcy judges sitting in the Southern District of Texas, court records show.
The U.S. Trustee has identified 34 cases in which former judge David Jones served as judge or mediator in which 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. Judge Isgur on Sept. 20 referred Jackson Walker for possible disciplinary proceedings for its failure to disclose the relationship between Freeman and Jones. Jones resigned from the bench in October when the secret relationship was publicly reported. Freeman was asked to leave the partnership in 2021 after confessing to the firm the relationship existed.
In the same Sept. 20 order, Judge Isgur recused himself from all disputes “between the United States Trustee and Jackson Walker that relate to alleged non-disclosure issues by Jackson Walker.” Of the 34 bankruptcy cases identified by the U.S. Trustee that had formerly been handled by judge Jones, Judge Isgur was assigned to 15 of them.
Nine of those were reassigned to Judge Christopher M. Lopez, and six were reassigned to Judge Alfredo Perez.
Other recent developments in the litigation include a Thursday ruling from Chief U.S. Bankruptcy Judge Eduardo V. Rodriguez denying Freeman’s emergency motion to quash the U.S. Trustee’s subpoena to Amegy Bank for her financial records.
Since the news of the relationship between Jones and Freeman became public, it has also been revealed in court proceedings and documents that they lived together in a home they jointly owned.
The next hearing in the case is scheduled for Oct. 8 at 4 p.m., where Chief Judge Rodriguez will determine whether the to grant a motion filed by the U.S. Trustee seeking to quash subpoena requests from counsel for Jackson Walker.
According to court documents, the subpoena requests seek information about current and former U.S. Trustee’s office employees. In prior court hearings and filings, counsel for Jackson Walker have argued the U.S. Trustee has been unresponsive to discovery requests aimed to suss out whether the U.S. Trustee’s Office had any knowledge about the romantic relationship between Freeman and Jones before The Wall Street Journal publicly reported it in October 2023.
Jackson Walker is represented by Jason L. Boland, William Greendyke, Julie Harrison, Maria Mokrzycka, Paul Trahan and Emily Wolf of Norton Rose Fulbright and Rusty Hardin, Leah M. Graham, Jennifer E. Brevorka and Emily Smith of Rusty Hardin & Associates.
Freeman is represented by Thomas Kirkendall of The Woodlands.
Jones is represented by Benjamin Finestone of Quinn Emanuel Urquhart & Sullivan.
The U.S. Trustee is represented by Laura Steele and Vianey Garza.
The case number is 23-00645.