The Work

September 15, 2010 1:51 PM

Baker & Hostetler's Madoff Tab Nearing $100 Million

Posted by Brian Baxter

Bernard Madoff may have been a scourge to his investors, but legal work on the infamous Ponzi schemer's bankruptcy continues to pay handsome dividends for Baker & Hostetler.

Baker partner Irving Picard, court-appointed trustee in the bankruptcy, has personally been awarded more than $35 million in fees and expenses for work done by his firm in the case, according to sibling publication the New York Law Journal. To date, the NYLJ reports that Baker & Hostetler as a whole has received close to $97 million for its Madoff work.

Earlier this month a group of several hundred Madoff victims, who have been lashing out at Picard for more than a year, objected to the latest fee request submitted by Baker & Hostetler.

Becker & Poliakoff partner Helen Davis Chaitman, a key advocate for Madoff victims who has her own Web site putting forth their position, lost most of her life savings in Madoff's $50 billion Ponzi scheme. Bloomberg reports that Chaitman argued Picard and his firm shouldn't receive payments for their work because they were trying to minimize payments by the Securities Investor Protection Corporation to Madoff victims.

Picard has vigorously denied such assertions, the NYLJ reports, citing court filings.

On Tuesday, U.S. bankruptcy judge Burton Lifland approved roughly $601,000 in additional fees for Picard and another $34.6 million to Baker & Hostetler for work done in the case between February 1 and May 31, according to the NYLJ.

Lifland also approved nearly $3 million in fee and expense requests by another ten firms helping Baker & Hostetler track down Madoff assets across the globe during that same time period. The awards are:

$1,954,838 to New York's Windels Marx Lane & Mittendorf

$332,589 to Hogan Lovells

$88,534 to Gibraltar's Attias & Levy

$87,074 to Cayman Islands firm Higgs & Johnson

$77,789 to Bermuda's Williams Barristers & Attorneys

$65,926 to British firm Mishcon de Reya

$59,644 to Luxembourg's Schiltz & Schiltz

$54,802 to Ireland's Eugene F. Collins

$10,619 to Montreal boutique Kugler Kandestin

$8,190 to SCA Creque, a British Virgin Islands branch of London-based SCA Andrew

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How horrifying and heartbreaking it is for the victims who have lost all of their savings to read about the windfall of millions of dollars going to Picard and his associates. Victims who cannot pay their bills to support themselves and their families stand helplessly and powerlessly by and watch a terrible travesty and miscarriage of justice. Shouldn't the victims receive the bulk of the money that was stolen from them? This horrendous financial holocaust should not be an opportunity for people to enrich themselves by receiving blood
money. This is immoral, unethical and unjust.

B & H just submits their time sheets and Judge (one of the boys) Lifland, simply rubber stamps it "APPROVED." Didn't anyone learn anything from "Madoff" about accountability? Doesn't anyone check to see if there might be duplicate billing on the time sheets, (unintentional, of course). I find it impossible to believe that all these lawyers were sitting around doing nothing when this SIPC job came along and were available to do this work. If they were busy servicing their clientele, who is doing it now? Who is checking on them? All they do is send in their time and $100 million later, what have they really done to deserve this kind of gravy payment? Most of the cash they found was just sitting around in a couple of NYC banks? Are they going to "earn" their keep by taking people who are in poverty and make them totally destitute by clawing back money (most of which they keep anyway)? Seems to me that if Picard loses net equity in 2nd circuit, he will take it to the Supreme Court in order to keep receiving his quarterly paycheck. Where is Harry Marcopolos when you need him?

Why shouldn't the attorneys working to secure as much money for the Madoff victims not be paid? This is hardly pro-bono type legal work. Uncovering all of the assets stashed around the world requires world class legal work. It's almost like the anger at Madoff is wrongly being transferred to Mr. Picard, who is on the side of the victims.

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