November 10, 2010 12:10 PM
Harrisburg Hires Cravath Pro Bono for Bankruptcy Advice
Posted by Brian Baxter
Cravath, Swaine & Moore has been hired by the city of Harrisburg, Pa., to advise its city council on its options surrounding a potential municipal bankruptcy filing.
The Am Law Daily reported last month that Cravath was one of five firms invited to pitch the city council on its qualifications to handle a possible Chapter 9 filing by Harrisburg, which has been struggling to repay almost $300 million in debt tied to a city incinerator.
Richard Levin, head of Cravath's bankruptcy practice, is working on the matter along with restructuring partner Paul Zumbro. Levin, who was one of the principal drafters of the 1978 Bankruptcy Code, made a high-profile lateral move by joining Cravath in August 2007 from Skadden, Arps, Slate, Meagher & Flom.
"Nobody underbid us," he jokes, before turning serious about the matter at hand. "All kidding aside, the city council members expressed that they really wanted to engage us because of our experience in Chapter 9. The other firms did not have any Chapter 9 or municipal distress experience, and we've got both, and we know the law in this area."
Last year Levin helped Cravath score its first-ever debtor's counsel assignment by representing New York City Off-Track Betting Corp. in its Chapter 9 filing. Cravath filed a plan of debt adjustment in the OTB case last week and a hearing for approval of the plan is expected in January. But Cravath's pedigree also worried the city council.
"They were concerned about New York fees," Levin says. "And we thought about it and said, 'Listen, we've had a long commitment to public service here, and we believe in pro bono work,' so we decided to do it on that basis. It's important for the firm, it's important for the city, and it's important for the residents of the city."
Levin has never been to Harrisburg--it was Zumbro who pitched the city council--but he's looking forward to visiting soon. Levin's not yet sure what the next step will be for his new client, but says it's important to note that as of now, the firm's current engagement is to advise the city council on its options and the pros and cons of Chapter 9 as a means of dealing with Harrisburg's debt problems.
And while Cravath is proud to be one of the few firms providing pro bono bankruptcy-related counsel these days, the firm still knows what keeps the lights on.
"At some point we might say that there are things collateral to this that we might not do pro bono," Levin says. "But the basic advice and Chapter 9 work will be pro bono."Make a comment