Top Jackson Walker Partner Was Wary of Lawyer-Judge Relationship

Jackson Walker LLP’s managing partner raised internal concerns in 2022 about the public and client fallout of disclosing a bankruptcy partner’s secret romantic relationship with a federal judge.

The internal email was discussed Thursday at a Texas bankruptcy court hearing to decide whether outside ethics expert reports can be considered as part of a US Trustee effort to claw back as much as $23 million in fees earned by Jackson Walker over not disclosing the relationship.

The email from Jackson Walker managing partner C. Wade Cooper shows him diagnosing some of the biggest potential problems the firm faced after learning that then-bankruptcy partner Elizabeth Freeman was in a relationship with Houston Bankruptcy Judge David R. Jones. The firm regularly appeared in front of Jones in large bankruptcy cases.

The communication and reports are part of a lawsuit in the US Bankruptcy Court for the Southern District of Texas in which the US Trustee’s office has said Jackson Walker breached its ethical duties by failing to disclose the relationship between Freeman and Jones.

Jackson Walker and the US Trustee, which is the Justice Department’s bankruptcy watchdog, agreed Thursday that fights over the ethics reports can be saved for trial.

“All of this evidence here is evidence that is designed to make us look bad without us being able to answer with other witnesses about it,” said Rusty Hardin of Rusty Hardin & Associates LLP, an attorney representing Jackson Walker.

US Trustee trial attorney Jaime Peña said at the hearing that the emails helped form the basis of its expert witness opinions, a necessary analysis of law and fact. An expected two-week trial in the case was pushed back to May.

Addressing Inquiries

Cooper’s April 2022 email, filed as an exhibit by the US Trustee, was sent several months after a firm partner heard revived bombshell allegations that Freeman was still secretly dating Jones.

Freeman in March 2021 told the firm that she and Jones had only a past relationship, that there was no ongoing romance, and that the two didn’t live together, according to court records.

But a firm litigation partner on Jan. 31, 2022, stumbled on new information. When confronted again on March 28, 2022, Freeman admitted to her firm that the relationship had reignited, according to court papers.

Cooper’s April 2022 email to partners Bruce Ruzinsky, Patrick Cowlishaw, and William Jenkins, came after Freeman’s attorney, Tom Kirkendall, suggested to the firm a possible bankruptcy disclosure.

That proposed disclosure described Freeman as in a “close personal relationship with Judge Jones,” but that raised flags for Cooper.

“How are Liz, Judge Jones, and the Firm going to address press and other inquiries that may follow the making of such a disclosure?” Cooper asked.

McDermott International

Jackson Walker has said it was first made aware of romantic allegations in March 2021 by a shareholder of bankrupt engineering giant McDermott International.

That shareholder, Michael Van Deelen, sought to disqualify Jones from the company’s Chapter 11 case, accusing him of bias in favor of McDermott as well its lawyers—Kirkland & Ellis LLP and Jackson Walker.

Cooper’s April 2022 email asked what disclosure of a “close personal relationship” meant, whether Van Deelen’s allegations were correct, and why a disclosure wasn’t made earlier. He also questioned how the relationship had more broadly affected the practice.

“Has this relationship been a factor, or a driving factor, in the rise to prominence of JW’s bankruptcy practice in Houston?” Cooper asked.

Cooper also raised concerns over how disclosure could risk cases the firm worked on.

“If the draft disclosure were made, what opportunity will that create for collateral attack on our recent cases in this court, at least going back to McDermott?” Cooper asked. “Should any cases be reopened, what risk does that raise of claims by our clients against the firm for the additional expense they will incur?”

Potential answers to the questions weren’t addressed in the emails made public. Jackson Walker didn’t disclose the relationship in early 2022 and it didn’t become public until 2023. Freeman agreed to leave the firm in December 2022.

Jones resigned from the bench in October 2023, after the relationship became public.

Jackson Walker has maintained it acted responsibly and appropriately at all times. Jackson Walker and Kirkendall declined to comment.

Jackson Walker is also represented by Norton Rose Fulbright US LLP.

The case is Prof’l Fee Matters Concerning the Jackson Walker Law Firm, Bankr. S.D. Tex., No. 23-00645, hearing 2/27/25.