Bankruptcy Law News

Milbank Ok’d as Counsel for Bankrupt Gymboree Over U.S. Objection

Feb. 15, 2019, 7:51 PM

Milbank, Tweed, Hadley & McCloy LLP got permission from a Virginia bankruptcy judge to represent Gymboree in its second bankruptcy in two years, even though a government watchdog said that conflicts should prevent their involvement.

Judge Keith Phillips of the U.S. Bankruptcy Court for the Eastern District of Virginia overruled the objection of the U.S. Trustee, a branch of the Justice Department charged with overseeing bankruptcy matters.

Phillips said that Milbank’s employment in the bankruptcy case was appropriate and praised the firm’s work in the matter since the Jan. 17 filing.

If it turns out that any conflicts arise from Milbank’s concurrent representation of Gymboree creditors Bank of America or Goldman Sachs in separate matters, conflicts counsel or attorneys for the creditors committee could step in to avoid a problem, Phillips said.

The case is In re: Gymboree Group, Inc., Bankr. E.D. Va., 19-30258, Objection to Application 2/12/19.

To contact the reporter on this story: Daniel Gill in Washington at dgill@bloomberglaw.com

To contact the editor responsible for this story: Seth Stern at sstern@bloomberglaw.com

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