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July 13, 2009 11:35 AM

Baker & Hostetler Bills $15 Million for Madoff Work

Posted by Zach Lowe

Quick note from a bit of news the New York Law Journal brought us on Friday: Baker & Hostetler submitted an application Friday for about $15 million in fees for the firm's work as trustee in the Bernard Madoff case. 

Irving Picard, a bankruptcy partner at Baker, has been serving as trustee since Madoff's arrest in December. Picard has had about 80 Baker partners and more than 100 associates working with him to track down Madoff's assets and deal with tens of thousands of customer claims, according to The Wall Street Journal's Law Blog and the NYLJ, an Am Law Daily sibling publication. Picard's personal bill amounts to $759,000 based on a billing rate just short of $700 per hour, court records show. The firm's team had discounted its normal billing rates by about 10 percent, the NYLJ says.

The Securities Investor Protection Corp., an organization funded by brokers to protect investors, is paying the legal fees and all other administrative expenses related to unwinding the Madoff scam. So far, SIPC has shelled out about $214 million, with much more to come, the NYLJ says. Of that $214 million, about $169 million has gone toward satisfying claims from jilted customers. (Picard has set aside about $231 million to satisfy a set of 543 claims from victims claiming losses of nearly $3 billion; that $231 million would represent the largest payout in SIPC's history, the NYLJ says.

The Baker team has dealt with more than 15,000 individual claims and has taken various steps to recover nearly $1.1 billion in assets from Madoff's estate, the NYLJ reports. They've also sued Madoff feeder funds and filed so-called claw-back suits against Madoff customers who withdrew money from Madoff in an effort to recover tens of billions more for customers, the story says.

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