Weil billings on Lehman near $400m as bank exits bankruptcy protection

Weil Gotshal & Manges’ fees on the Lehman Brothers administration have reached almost $400m (£254m), as the bank emerges from bankruptcy more than three years after its collapse, reports The Am Law Daily.

Lehman officially exited from bankruptcy protection on Tuesday morning (6 March), after its abrupt fall in September 2008 prompted the largest Chapter 11 case in US history.

A monthly operating report filed by the Lehman estate with the Securities and Exchange Commission last week shows that its total bankruptcy bill for external lawyers, accountants and other restructuring professionals has reached almost $1.6bn (£1bn), not far off the $1.4bn (£890m) that Bloomberg estimated it would pay external advisers three years ago.

Of that amount, Weil has been paid nearly $383m (£243m) in fees and expenses for its work as lead debtors’ counsel. The sum represents almost 8% of the $4.9bn (£3.1bn) Weil has collected in gross revenues over the past four years.

Milbank Tweed Hadley & McCloy, lead counsel to Lehman creditors, has received almost $134m (£85m) in fees and expenses for its work.

The Chapter 11 case, which has seen more than 30 law firms bill the bankrupt estate, has also seen Jones Day paid $61.2m (£39m) for its role as special litigation counsel, with $42.5m (£27m) for conflicts counsel Curtis Mallet-Prevost Colt & Mosle and $21m (£13.3m) for special tax counsel Bingham McCutchen.

“We’re very proud of the work we’ve done,” said Weil business finance and restructuring chair Marcia Goldstein. “The [bankruptcy] judge has been extremely complementary of us.”

In a statement, Lehman said that it will begin making payments to creditors on 17 April. Weil bankruptcy partner Lori Fife said the defunct bank should remain a going concern for at least three years to manage the ongoing process of liquidating its remaining assets in order to pay creditors, although one asset not yet for sale, Fife said, is the Lehman name.

Legal fees on the administration of Lehman in Europe reached £321.6m last September, following the publication of the administrators’ biannual sixth progress report. Linklaters was instructed as the main adviser to Lehman in Europe at the time of the bank’s collapse; however, the £321.6m figure covers legal fees paid to all 30 firms across Europe to have acted on the bankruptcy.

In 2009 it was reported that the magic circle firm had notched up more than £33m in fees for its first six months of work advising on Lehman’s collapse. The firm fielded a team of several hundred lawyers advising administrator PricewaterhouseCoopers.