THE AM LAW DAILY

SURVEYS AND RANKINGS

MAGAZINE

SPECIAL REPORTS

The Work

January 20, 2009 2:16 PM

Jenner Chair Tapped to Probe Lehman Creditors' Claims

Posted by Zach Lowe

Last month we told you that Hughes, Hubbard & Reed partner James Giddens had requested--and been granted--subpoena power to investigate the collapse of Lehman Brothers' broker-dealer unit.

Now, thanks in part to an aggressive push by The Walt Disney Co., Giddens has company: Jenner & Block chair Anton Valukas, a former federal prosecutor, has been appointed by a federal bankruptcy judge to investigate the failure of Lehman Brothers Holdings Inc., the larger Lehman entity that failed in September. 

Valukas was traveling on Tuesday and unavailable for comment. While he and Giddens have distinctly separate functions, their roles will overlap, according to court papers and lawyers familiar with the process.

As the court-appointed trustee overseeing the liquidation of Lehman's brokerage unit as required under the Securities Investor Protection Act, Giddens's main job is to ensure that customers' brokerage accounts remain intact and are transferred to entities, including Barclays, that have purchased the relevant chunks of Lehman. (Barclays purchased nearly $2 billion worth of Lehman assets shortly after Lehman filed for Chapter 11 protection in mid-September.)  

Valukas's appointment as examiner for Lehman Brothers Holdings, meanwhile, is tied to bankruptcy code provisions that allow creditors to seek such an arbiter.  In the Lehman Brothers Holdings filing, Walt Disney Co. led several creditors in asking for an independent examiner to go through the failed firm's books, court records show.

Disney, repped by Dewey & LeBoeuf's Martin Bienenstock, is concerned that Lehman may have violated its sales agreement with Barclays by selling assets it wasn't authorized to sell. (Disney says Lehman owes it $92 million.) Disney and other creditors, including Bank of America, also want to see how Lehman moved money between its myriad units in the days before it went bankrupt; creditors have long been concerned over $8 billion Lehman transferred from its London operation to its New York headquarters hours before its Chapter 11 filing.

Valukas will have full subpoena power as he attempts to sort all of this out, Bloomberg reports.

As our friends at The Am Law Litigation Daily tell us, this could be a profitable job for Valukas and Jenner--especially when you consider that the Alston & Bird team that filled the same role in the Enron case wound up billing more than $100 million.

Make a comment

Comments (0)
Save & Share: Facebook | Del.ic.ious | | Email |

Reprints & Permissions

Comments

Report offensive comments to The Am Law Daily.

Post a comment

If you have a TypeKey or TypePad account, please Sign In





By: TwitterButtons.comhttp://www.facebookloginhut.com/facebook-login/


theamlawdaily@alm.com




From the Law.com Newswire

Sign up to receive Legal Blog Watch by email
View a Sample

Advertisement