Lawyers in Bankruptcy
Clients often present to us ashamed that they are in financial dire straits. They are embarrassed. Usually their situation is not unusual, and not their fault. We haven’t had any clients, in the past 28 years anyway, that have just finished an around the world trip and now need to file bankruptcy. Generally, folks were working and they lost their job, or a family member became ill, resulting in the need to file for bankruptcy protections. Of course, for several years beginning around 2008, the housing crisis caused many of the bankruptcies we filed.
Bankruptcy Protection and a Fresh Start For Law Partner
In a case filed in New York, a successful attorney was required to file for bankruptcy protection with approximately $3 million in debt. Attorney Gregory Owens, a “partner in the now defunct law firm of Dewey & LeBoeuf, was left with no other choice. When Dewey & LeBoeuf failed (the law firm filed for bankruptcy in 2012) Mr. Owens was made “partner” in White & Case, he was not really a partner. Instead, he is a “non equity partner” which essentially means he is an employee with a fancy title. He was de-equalized. He likely has no large clients, although he is likely an outstanding attorney. Unfortunately, Mr. Owens is not alone in this type of transformation – all over the country top lawyers are being demoted as such. Fortunately for Mr. Owens, his mentor, Attorney Morton Pierce, a large rainmaker for any firm he is associated with, took him along to White and Case.
Mr. Owens is part of a growing minority of “partners” who are non-equity partner’s at large prestigious law firms. In fact the number of large firms that have such partnership status has grown to 84% according to an expert report.
Outstanding Debts Due to Bankruptcy of Dewey & LeBoeuf
When Mr. Owens filed for a fresh start in bankruptcy, our understanding is that his significant debts were related to the debts he incurred as an equity, or full, partner at Dewey & LeBoeuf. Discharging those debts was his objective. Unfortunately, the bankruptcy petition and schedules indicates that he was recently divorced and owes significant child support and alimony.
Full partner at White & Case Attorney Pierce paid $1,000,000 into the Dewey trust to satisfy creditors. Unfortunately, Mr. Owens did not have the resources.
On the other hand, Mr. Owens had over one million dollars in an ERISA protected retirement account. Such monies are protected in personal bankruptcy.
Experienced Bankruptcy Attorney
Regardless of the reason you, or a loved one, is in need of a fresh start, seek an experienced attorney who can reassure you that you are not alone. If a full partner in a white shoe law firm in Manhattan can end up in bankruptcy, all due to circumstances beyond his control, so can anyone. And, as the law allows for a fresh start, why not consider this if you are in the dire straits that Mr. Owens found himself in. Finally, protect your exempt assets such as retirement accounts and the equity in your home. Call Attorney Neil Burns for a free consultation.