June 1, 2009 2:53 PM
Lawyers Line Up to Receive GM Bankruptcy Roles
Posted by Brian Baxter
Update, 6/1/09 at 4:30 p.m. - Additional information on the lawyers/law firms working on the bankruptcy has been added throughout the post.
As President Barack Obama spoke about the path that led General Motors to file for bankruptcy Monday, the docket in the largest industrial bankruptcy in U.S. history continued to expand exponentially.
The Detroit-based auto giant stated in court documents that it was $172.8 billion in debt. As GM works to restructure its operations, hundreds, if not thousands, of lawyers will attach themselves to some part of the proceedings to carve out some much-needed business. It'll be The Am Law Daily's duty to keep you apprised of the latest representations.
The U.S. government, through the U.S. attorney's office in Manhattan and Cadwalader, Wickersham & Taft financial restructuring cochair John Rapisardi, has filed a 14-page statement on how it views the GM Chapter 11 proceedings before U.S. bankruptcy judge Robert Gerber, a former partner at Fried, Frank, Harris, Shriver & Jacobson prior to his appointment to the bench in 2000.
Cadwalader private equity group chair R. Ronald Hopkinson, M&A chair Louis Bevilacqua, finance partners Julian Chung and Steven Cohen, tax cochair Linda Swartz, litigation partner David Williams, financial restructuring special counsel Peter Friedman and Leslie Chervokas, corporate special counsel Peter Gyr, and associates Douglas Mintz, Zachary Smith, and James Langston are advising the Treasury Department.
As we previously reported, Weil, Gotshal & Manges has the lead bankruptcy role for GM through partners Stephen Karotkin, Harvey Miller, and Joseph Smolinsky. Karotkin submitted a 98-page affidavit to the court by GM's CEO Frederick "Fritz" Henderson, in which Henderson stated the 101-year-old company would liquidate if a reorganization plan wasn't approved.
Cravath, Swaine & Moore board adviser extraordinaire Robert Joffe and M&A practice chair Philip Gelston are advising GM's board of directors along with banking practice chair B. Robbins Kiessling and corporate partner Sarkis Jebejian.
The Cravath team is advising on negotiations regarding the future of GM's European operations as well as representing GM on its continuing business relationship with and investment in finance arm GMAC, which has not filed for bankruptcy. (GMAC is being advised by Otterbourg, Steindler, Houston & Rosen's Melanie Cyganowski, a former U.S. chief bankruptcy judge in Brooklyn who joined the firm last July.)
Robert Weiss, chair of the bankruptcy and reorganization group at Detroit's Honigman Miller Schwartz and Cohn, is leading a team from the firm advising GM on its agreements with North American affiliates and auto parts vendors.
An examination of several Big Auto-related bankruptcy filings--such as Chrysler, Metaldyne, and Visteon--shows that Honigman finance practice cochair Donald Baty, Jr., and bankruptcy partners Aaron Silver and Tricia Sherick are also advising GM.
Cleary Gottlieb Steen & Hamilton corporate partners Richard Lincer and David Gottlieb, ERISA partner A. Richard "Brick" Susko, bankruptcy partner James Bromley, tax partners Yaron Reich and Jason Factor, antitrust partners Mark Nelson and James Modrall, antitrust counsel Steven Kaiser, and associates John Delaney, Lua Yuille, Tom Sylvester, Jason Ford, Michael Albano, Catharine Slack, James Croft, Mirna Zwitter-Tehovnik, and Corey Goodman are advising the United Auto Workers. New York employment firm Cohen, Weiss and Simon is also advising the union.
Under the terms of a deal reached between GM and the union last week, the UAW will have the right to buy up to 20 percent of a reorganized GM entity but be forced to swallow several painful cost-cutting concessions.
Orrick, Herrington & Sutcliffe restructuring chair Roger Frankel is advising an unofficial committee of GM dealers along with bankruptcy partner Richard Wyron.
Reed Smith commercial restructuring and bankruptcy partners Eric Schaffer and Kurt Gwynne are representing Pittsburgh-based United States Steel, the nation's second-largest steelmaker. Court records show that GM owes U.S. Steel nearly $10 million. (The steel industry's restructuring pains have been noted as a potential template for rehabilitating Big Auto.)
Troy, Mich.-based auto parts supplier Delphi, which was spun-off from GM in 1999 and languished in Chapter 11 for four years before a private equity group announced a plan to buy it out of bankruptcy, is being represented by Skadden, Arps, Slate, Meagher & Flom corporate restructuring partner Kayalyn Marafioti. The firm is Delphi's lead bankruptcy counsel. Owed more than $110 million, Delphi is GM's seventh-largest creditor.
Partners James Plemmons and Michael Hammer from Dickinson Wright are representing Milwaukee-based car battery maker Johnson Controls, Canadian auto parts manufacturer Magna International, and Van Buren Township, Mich.-based Visteon.
GM owes Johnson Controls more than $32 million, making the company GM's 12th-largest creditor. Magna follows closely behind as the 15th-largest creditor, owning roughly $26 million in debt. (Legal Week reported on Friday that German firm Gleiss Lutz is also advising Magna, which over the weekend announced plans to buy GM's European auto units Opel and Vauxhall.)
Dickinson Wright wasn't the only Michigan firm to get in on the GM Chapter 11 action:
-- Warner Norcross & Judd partner Gordon Toering is representing Farmington Hills, Mich.-based Robert Bosch LLC, the U.S. unit of German auto parts giant Robert Bosch, which GM owes more than $66 million.
-- Deborah Fish, a founding partner of Detroit bankruptcy boutique Allard & Fish, is representing the U.S. unit of Russian steel giant Severstal. Severstal North America holds $6.7 million in GM debt.
The list doesn't end there.
Davis Polk & Wardwell insolvency and restructuring cochair Marshall Huebner, an American Lawyer Dealmaker of the Year and part-time courtroom EMS practitioner, is representing the Ford Motor Company. Simpson Thacher & Bartlett bankruptcy head Peter Pantaleo is advising Citigroup.
Paul Ricotta, a bankruptcy partner with Boston's Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, is representing Japanese conglomerate Hitachi, which owns $6.2 million in GM debt. Partners David Baldwin and Theresa Brown-Edwards from Delaware's Potter Anderson & Corroon are representing railroad operator Norfolk Southern.
Van Nuys, Calif.-based truck wheel manufacturer Superior Industries International is being represented by Arent Fox bankruptcy partner James Sullivan, while Pittsburgh-based auto paint producer PPG Industries has turned to K&L Gates's Eric Moser.
Alan Kornberg, chair of the bankruptcy and corporate reorganization department at Paul, Weiss, Rifkind, Wharton & Garrison, is advising Toledo-based car parts maker Dana Holding, which emerged from bankruptcy in February 2008, and Enterprise Rent-A-Car.
Isenberg told Reuters in April that the main difference between a GM bankruptcy and the mammoth proceedings in Lehman Brothers would be the fact that the automaker had time to inform and prepare employees, investors, and the general public of its restructuring plans through Chapter 11.
"With GM, every sophisticated creditor is lawyered up," Isenberg said. "If there is opposition from unions or bondholders, they are well poised to assert their opposition in a coordinated fashion."
A hearing in the case is scheduled for 4 p.m. in courtroom 623 in U.S. bankruptcy court in Manhattan. Tickets are going fast.
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