This Wall Street Journal ($) article reports that Harvey Miller — the New York attorney who built Weil, Gotshal & Manges‘ bankruptcy and corporate reorganization practice into a national dynamo before leaving the firm in 2002 to join Greenhill & Co. — is being accused of overbilling his client Loral Space & Communications Ltd. of as much as $3.6 million in the company’s recently concluded corporate reorganization case.
To add intrigue to the matter, Miller’s chief accuser is the creditors’ committee counsel in the Loral case, Akin, Gump, which incurred the wrath of Miller’s opinion last year in the Vermont bankruptcy case of FiberMark Inc., in which Miller concluded that the firm should forfeit a “significant portion” of its fees in that case because Akin, Gump gave allegedly biased advice to the FiberMark creditors’ committee. Akin, Gump is reportedly prepared to waive $1.5 million of its total remaining unpaid fee of $4.0 million in that case.
The challenge to Miller’s fee-charging is particularly interesting in that Miller was at the forefront of the movement to attract top-notch legal talent to the U.S. bankruptcy and reorganization legal field over the past 30 years. One of the ways that was accomplished was through the incorporation into the U.S. Bankruptcy Code of provisions that provide for attorneys to be compensated at the market rate for providing professional services to debtors in bankruptcy cases. For many years while at Weil, Miller’s hourly billing rate was among the highest of any attorney practicing bankruptcy law in the United States, and Weil’s fees for representing corporate debtors in a number of reorganization cases have been among the highest ever approved and paid. Those high fees are the genesis of the nickname for Weil, Gotshal & Manges among some envious members of the bankruptcy bar — “We’ll, Getcha & Mangle Ya.”
Update: The prescient Peter Lattman provides even more interesting background.