Detroit legal costs could top $100 million


By Neasa MacErlean

21 August 2013 at 07:11 BST


Lawyers involved in the Detroit bankruptcy will meet the newly-appointed fee examiner in September as Detroit tries to keep the costs rising to $100 million - a figure some experts have predicted.

In the first six weeks after bankruptcy Jones Day billed $1.4 million Andrey Bayda

The US Bankruptcy Judge Steven Rhodes has just appointed lawyer Robert M. Fishman of Chicago firm Shaw Fishman Glantz and Towbin, on rates of $600 per hour, to check fees of legal advisers. Jones Day billed $1.4 million in the first six weeks after the bankruptcy. Its former partner Kevyn Orr was appointed emergency manager of the city. Michigan law firm Miller, Canfield, Paddock and Stone is one of various other legal and accountancy firms also giving advice.

Local lawyer Byron Gallagher Jr told the Detroit Free Press: 'All of the people involved in disputes at this level are paid at the top scale…As a percentage of what’s involved in any of these cases, the fees will be a small part of the dispute.'

A 10 September meeting will discuss proposals from the judge that they submit invoices on a monthly basis. The fee examiner will give a three-monthly report on progress and can recommend a hearing before the judge if he believes that fees are excessive.

 
   
 
 
 

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