Ex-Bankruptcy Judge Agrees to Jackson Walker Romance Questioning

A former judge tied up in litigation related to his relationship with a onetime Jackson Walker LLP partner agreed to let the Texas law firm depose him over key questions about the romance.

Jackson Walker and David R. Jones, the former Houston bankruptcy judge, agreed to a seven-hour deposition on July 18 on topics related to his previously-secret relationship with attorney Elizabeth Freeman. The questioning will come as Jackson Walker battles a government effort to claw back more than $13 million in fees the firm collected in cases that were handled by Jones, while it employed Freeman.

The dispute is part of the still-unfolding scandal surrounding Jones, once the busiest corporate bankruptcy judge in the country, after he admitted to the romance with attorney Freeman last year. Jackson Walker regularly represented clients in large bankruptcies in front of Jones before he resigned.

Chief Judge Eduardo V. Rodriguez of the US Bankruptcy Court for the Southern District of Texas signed off on the stipulation Tuesday.

Jackson Walker has said Jones’ testimony is crucial in determining whether anyone at the firm was aware of the relationship. Jones previously criticized the request, saying its true purpose is to harass and embarrass him.

‘Ostrich Defense’

The deposition agreement came a day after the Justice Department’s bankruptcy unit, the US Trustee’s office, forcefully pushed back against Jackson Walker’s argument that it didn’t violate any ethical rules in not disclosing the relationship because it didn’t know about the romance.

Allowing Jackson Walker to keep the more than $13 million legal fees “would undercut the very underpinnings that mandate ethical disclosures in the first place,” the US Trustee’s office said in court filings made in several bankruptcy cases filed late Monday.

“The Court should reject Jackson Walker’s dismissive ‘no harm, no foul’ approach to its misconduct,” the US Trustee said. “The harm, in these cases and to the reputation of this Court and the integrity of the bankruptcy system more broadly, is immeasurable.”

Jones, Freeman, and Jackson Walker are all facing litigation accusing them of improperly keeping the relationship out of the public eye. Freeman left Jackson Walker at the end of 2022. She co-owned a home with Jones from at least 2017, and was the executor and beneficiary under Jones’ will, according to court papers.

“Jackson Walker made a conscious decision to hide the fact that its partner had a financial and romantic relationship with a judge before whom her firm appeared both in cases where he presided and that he mediated,” the US Trustee said Monday.

The firm violated its duties under the bankruptcy code, as well as Texas rules of conduct and as officers of the court, the US Trustee said.

Jackson Walker has said Freeman lied about the status and nature of the relationship. The US Trustee called that argument an “ostrich defense,” saying Freeman’s knowledge of her relationship with Jones is imputed to the whole firm.

The firm has also said it took internal steps to address the matter once it learned of the relationship. But its failure to to disclose the connection publicly shows that it knew it had an ethical problem but consciously decided to keep the romance a secret, the US Trustee said.

A Jackson Walker spokesman declined to comment. Jones didn’t immediately respond to a request for comment Tuesday.

Jackson Walker is represented by Rusty Hardin & Associates LLP and Norton Rose Fulbright US LLP.

Jones is represented in this action by Quinn Emanuel Urquhart & Sullivan LLP.

The case is Professional Fee Matters Concerning the Jackson Walker Law Firm, Bankr. S.D. Tex., No. 23-00645, order 7/2/24.