Thursday, May 31, 2012

Dewey's bankruptcy: Let the rumble begin

(Reuters) - As law firm Dewey & LeBoeuf embarks on the humbling process of working through bankruptcy, creditors and former partners are bracing themselves for a nasty court battle that could drag on for years.

Dewey, a storied firm with deep Wall Street connections, filed for Chapter 11 protection on Monday night. The firm had veered toward collapse over the last six months amid revelations of fat salary guarantees, risky loans and a culture of secrecy.

Some former partners have hired lawyers in anticipation of clawback suits by the estate. Law firms that offered positions to former partners could also get embroiled in fights over rights to client fees. Creditors ranging from banks to temp services have started jockeying for position to maximize limited payouts. Read More