Free Speech, Due Process and Trial by Jury
The legal and financial advisors in the Vertex Energy bankruptcy and restructuring have filed their applications for official employment, and the numbers never cease to amaze. Kirkland, Bracewell, Alvarez & Marsal and Perella Weinberg Partners filed their fees to be approved by SDTX Bankruptcy Judge Christopher Lopez.
The Johnson & Johnson talc powder bankruptcy filing in Houston is less than a month old, but new documents filed Sunday in the case show that it is going to be highly profitable for the lawyers and law firms involved. Over the past three days, lawyers for Jones Day, Porter Hedges, King & Spalding, Skadden Arps, Shook Hardy & Bacon and McCarter & English have filed their official applications to represent Red River Talc, the J&J subsidiary. Jones Day's Dallas office is the biggest financial beneficiary.
The Association of Corporate Counsel’s DFW Chapter and The Texas Lawbook are now accepting nominations for the 2024 DFW Corporate Counsel Awards, including nominations for Achievement in Pro Bono and Public Service and Achievement in Diversity and Inclusion. In the news this week, the American Bar Association honors former LyondellBasell GC Craig Glidden, and the Federal Bar Association recognizes Dallas lawyer Martha Hardwick Hofmeister for outstanding leadership. On Thursday, the Dallas Bar Foundation presented retired NDTX Bankruptcy Judge Harlin Hale with the Justinian Award.
Plus, The Lawbook thanks Sempra Energy Chief Risk Management and Compliance Officer Carolyn Aiman and Shell USA Head of Legal Travis Torrence for donations to the Texas Lawbook Foundation to support our coverage of pro bono, public service and diversity in the legal profession.
Editor's note: The Lawbook misspelled Judge Hale's first name in earlier editions. We apologize for the error.
Houston Bankruptcy Judge David Jones’ voice was filled with emotion one year ago today in an interview with The Texas Lawbook. “I don’t know. I don’t know. I don’t know what is going to happen next. I just don’t know. I guess I have to resign.”
The Fifth Circuit had just published notice that it was investigating possible misconduct by Judge Jones over allegations that he had been involved in a multiyear secret romance with a former bankruptcy partner at Jackson Walker. The firm had been paid more than $20 million — fees often approved by Judge Jones — for its role in dozens of high-profile bankruptcies in which Jones served as judge or mediator. Jones officially resigned Oct. 15, 2023. The 365 days since have been pure chaos in the Houston bankruptcy courts, which is one of the three busiest courts in the nation for business bankruptcies.
“The whole thing is a mess, a complete fiasco,” said former UNT Dallas law dean Royal Furgeson. In a first-ever detailed timeline of the events of the past year and several years prior, The Lawbook documents a scandal about romance, secrecy, tens of millions of dollars in legal fees and ethical lapses that have engulfed the bankruptcy courts in Houston.
U.S. Bankruptcy Judge Christopher Lopez said Thursday that he is keeping a Johnson & Johnson-related bankruptcy in Texas and not transferring the case back to New Jersey where J&J is headquartered.
During a hearing Tuesday, Chief U.S. Bankruptcy Judge Eduardo V. Rodriguez gave Jackson Walker and the U.S. trustee’s office until Oct. 15 to provide the court with further briefing on whether the depositions of the current and former U.S. trustee for Region 7 and a current trial attorney in that office should take place. He promised to rule quickly on the matter after the briefing is filed and said that for each day after Oct. 16, if he doesn’t file an order, he will be extending discovery deadlines by one day. Discovery is slated to close Nov. 1.
Citing $112 million in municipal debt, Fort Worth senior living center The Stayton at Museum Way has filed for Chapter 11 bankruptcy protection for the second time in five years.
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.
Few Texas courtrooms are as busy as Houston Bankruptcy Judge Christopher Lopez's. His docket of more than 380 business bankruptcies, plus a couple thousand personal and consumer bankruptcies, includes some of the highest profile and bitterly disputed corporate restructurings currently pending in the U.S., including J&J’s controversial $10 billion Chapter 11 Texas Two-Step restructuring under the subsidiary Red River Talc, and conspiracy theorist Alex Jones’ Info Wars media company. Judge Lopez is, by all accounts, establishing himself as one of the premier jurists for the most complex restructurings. But there are things lawyers should know when handling cases before Judge Lopez.
Houston-based energy transition products provider Vertex Energy Operating filed for Chapter 11 bankruptcy protection Tuesday in the Southern District of Texas citing $500 million to $1 billion in financial liabilities. Vertex Energy General Counsel James Gregory hired Kirkland & Ellis and Bracewell as its legal advisors in the restructuring. The case has been assigned to Houston Bankruptcy Judge Christopher Lopez.
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