LeBoeuf Retirees: Not Fans of Proposed Dewey Settlement
07/18/12
- Reuters
So it’s been nearly a week since the team winding down the defunct law firm Dewey & LeBoeuf LLP briefed former partners on a proposed “clawback” settlement that would shield the ex-partners from future liability—as long as they pay up $25,000 to $3 million in cash. The plan also targeted hundreds of former partners who had retired or left the firm but received cash payments after January 2011.
Reactions to the plan last week ranged from icy to outraged to “meh” among the former partners who spoke with The Wall Street Journal.
Now, a subset of 53 retires and/or their widows from the LeBoeuf side of the firm have weighed in, and they’re, unsurprisingly, mad. Their beef: They said Dewey owes them money for their pensions. (That point is debated by legal experts, because unfunded pension plans like theirs are paid out of current firm profits—no firm, no profits, no payments, some argue.) They also want to be able to sue those they blame for the firm’s demise.
Last week, the most common objection to the plan was a $3 million payout cap that some ex-partners said unfairly protected some of the firm’s most highly paid partners, some of whom earned at least $6 million a year. Also a sticking point: Members of the firm’s executive committee who signed on to the agreement would be protected from lawsuits, even though some partners blame them for not keeping a proper watch on the firm’s finances in the months and years leading up to Dewey’s May 28 bankruptcy filing. (Former Chairman Steven Davis was not invited to participate, presumably so the estate could reserve the right to sue him in future.)
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