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Wake Up Call: Stop Payments to Sears’ Law Firms, Small Creditors Ask Judge

Aug. 30, 2019, 11:48 AM
  • A group of small Sears creditors are asking a judge to stop or sharply reduce payments to Big Law firms working on the retail giants’ bankruptcy. The small creditors argue that firms including Weil, Gotshal & Manges, Paul Weiss, and Akin Gump Strauss and other professional advisers are making a pile of money—about a $130 million so far—while manufacturers and other small companies that stocked the retailer’s stores get zilch. They say they want equal treatment, according to a report. (New York Post)

  • The Weil-advised estate holding the retailer’s assets, Sears Holding Corp., is working out a plan for the bankruptcy following the $5.2 billion bankruptcy auction sale of the retailer in January to a company formed by a hedge fund controlled by former Sears CEO Eddie Lampert. Meanwhile, Sears Holding is pushing back against so-called administrative claims. (BLAW)

  • Goldman Sachs & Co., represented by Paul Hastings, Sullivan & Cromwell, and DLA Piper, has to turn over more documents in a sex bias lawsuit that was filed in 2010. A New York federal judge yesterday rejected Goldman’s claim that discovery would be too burdensome. Lieff Cabraser Heimann & Bernstein and Outten & Golden represent the class of women suing the company for alleged firmwide sex bias. (BLAW)

  • Named plaintiff Cristina Chen-Oster, a former vice president at Goldman Sachs, began fighting Goldman Sachs in 2005, but it took 13 years to win class-action status. (BN via BLB)

  • Forever 21 Inc., which recently added Kirkland & Ellis and Latham & Watkins to its advisers, is reported to be readying a potential bankruptcy filing as the fashion retailer’s cash dwindles and turnaround options fade. (BN via BLAW)

  • Walt Disney Co. is selling YES Network back to the New York Yankees, which is joined by a group of investors including Sinclair Broadcast Group Inc., Inc., and others to buy the team’s cable network in a deal valued at $3.47 billion. Disney acquired majority ownership of the YES Network as part of its $71 billion takeover of 21st Century Fox film and TV assets earlier this year. (BN)

  • Orrick, Herrington & Sutcliffe is building an appellate pipeline by giving mid-level associates the kind of appellate experience traditionally reserved for partners. (BLAW via BLB)

  • A former Google legal department employee this week expanded on her previous allegations about her relationship with the chief legal officer of Google parent company Alphabet Inc. (BN via BLAW)

Lawyers, Law Firms, Deals

  • Mayer Brown represented global infrastructure investor First State Investments in its agreement with SteelRiver Infrastructure Partners, an independent investment manager, to acquire 100% of the equity of Patriot Rail and Ports. Patriot Rail and Ports operates a portfolio of 12 short line freight railroads with more than 585 track miles across 14 states in the United States. No terms were disclosed. ( (Railway Age)

  • Fisher & Phillips didn’t breach its fiduciary duty toward a trucking company it represented in a Fair Labor Standards Act case, a Texas federal court ruled. (BLAW)

  • A midwestern merger is creating a firm with about 600 lawyers, as Minneapolis-based Briggs and Morgan agreed to combine with Taft Stettinius & Hollister, which has offices in Indianapolis, Chicago, and Cincinnati. (

  • Embattled celebrity lawyer Michael Avenatti told a judge he needs more time to prepare for his extortion trial. (BN via BLAW)

  • Snell & Wilmer said its Phoenix-based litigation and investigations partner Barbara J. Dawson was appointed 2019-20 chair of the American Bar Association litigation section. (

  • Is it pot or is it not? Under a new Texas law, authorities have the burden of proof, two singing lawyers say. (

Laterals, Moves, Promotions

  • Haynes and Boone said real estate lawyer George Hinchey rejoined the firm as partner in San Antonio. He arrives from Jackson Walker. (

  • Holland & Knight added the former deputy director of the Georgia Municipal Association, attorney Marci Rubensohn, as a senior policy advisor and member of the firm’s Georgia government advocacy team. (

  • Aryaka Networks, a San Francisco-based enterprise network technology company, said it hired in-house veteran Christiana Khostovan as its new general counsel and corporate secretary. She was previously top lawyer at Revel Systems, Inc. and spent a year in-house at IBM company Corio, Inc. (

  • McGuireWoods added Reed Smith labor & employment attorney Remy Kessler, who has helped several retailers beat class actions, as a partner in Century City, California. (

Legal Actions, Decisions

  • Blue Bell Creameries can’t pause a shareholder lawsuit over a killer listeria outbreak to let its new Drinker Biddle-advised special committee investigate on the company’s behalf, a Delaware court ruled. (BLAW)

  • Samsung Electronics America Inc., advised by Arnold & Porter Kaye Scholer, is trying to get a California federal appeals court to reverse decisions that rejected its motions to compel arbitration in disputes with buyers of its Galaxy S7 and Galaxy S7 Edge smartphones. (The Recorder)

  • A former paralegal at Zarwin Baum DeVito Kaplan Schaer Toddy is suing the Philadelphia-based firm in federal court for allegedly creating a “sexually hostile work environment” and firing her when she complained. (

Regulators and Enforcement

  • Employers don’t violate federal labor law by misclassifying their workers as independent contractors instead of employees, the National Labor Relations Board ruled yesterday. (BLAW)


  • A Philadelphia court’s online docket search function was down for a week, the second major disruption of the court’s electronic services this summer. (

To contact the correspondent on this story: Rick Mitchell in Paris at

To contact the editors responsible for this story: Rebekah Mintzer at; Molly Ward at