Wednesday, June 12, 2013
Dept. of Justice Chapter 11 fee guideline amendments
American Lawyer’s AmLaw Daily yesterday had an article about new rules & guidelines unveiled by the U.S. Trustee Program -- the branch of the U.S. Department of Justice responsible for overseeing the federal bankruptcy process -- aimed at ensuring that law firms charge clients they represent in Chapter 11 cases rates comparable to those they bill in other practice areas.
“The guidelines,” AmLaw’s article states, “which will go into effect for cases filed after November 1, but are not legally binding, are the product of a 18-month-plus process that represents the first thorough review in nearly 20 years of how attorneys in large bankruptcies are compensated and reflect a desire on the government's part to bring bankruptcy-related fees in line with recession-driven changes to client expectations and law firm pricing practices that are affecting other types of legal work. While the Trustee's office routinely scrutinizes attorneys fees and expenses in Chapter 11 cases, only judges can withhold requested fees or require law firms to submit additional details as a condition of receiving payment for their work.”