Jackson Walker Lawyer Texts Reveal Anger Over Judge Romance

Two Jackson Walker LLP bankruptcy attorneys discussed in 2021 the impending fallout of an undisclosed romance between one of their colleagues and Houston bankruptcy judge David R. Jones—and expressed anger with the judge, texts show.

The texts, displayed in records viewed by Bloomberg Law, offer an inside glimpse into how the two lawyers responded to explosive allegations from Michael Van Deelen, an aggrieved shareholder of then-bankrupt engineering giant McDermott International, that firm partner Elizabeth Freeman was in a relationship with Jones, who oversaw many of Jackson Walker’s cases.

The exchange between Freeman’s colleagues suggests they wanted to protect her from a public relations storm, which would ultimately befall the couple when the relationship was revealed two years later, prompting the judge’s resignation.

Van Deelen on March 6, 2021, received an anonymous letter claiming Jones was in a relationship with Freeman. It alleged Jackson Walker had received favorable treatment because of the relationship.

The letter supplied ammunition for a hearing four days later to recuse Jones from a case Van Deelen was pursuing. Jackson Walker, which bills itself as the largest firm in Texas with more than 500 attorneys, at the time represented McDermott, serving as co-counsel to powerhouse firm Kirkland & Ellis LLP.

Van Deelen quickly emailed the Jackson Walker bankruptcy partner leading McDermott work, Matt Cavenaugh, asking him about the allegations.

That communication sparked a flurry of actions among Freeman’s close colleagues at the firm. She left Jackson Walker in December 2022.

Cavenaugh texted his colleague Veronica Polnick, on May 20, 2021, that Freeman and Jones had “been very careful” and had “taken a lot of steps.”

“But the fact that they’ve taken so many steps makes it problematic from a pr standpoint,” Cavenaugh said.

“Right,” Polnick, who was previously a briefing attorney for Jones, responded. “They saw this coming 10 years ago.”

Since Jones stepped down last year, a deluge of complex litigation has ensnared him, Freeman, and Jackson Walker. A criminal probe has been opened, and a pall has been cast over the Southern District of Texas bankruptcy court.

The communications could be key in efforts by the Justice Department’s bankruptcy watchdog, the US Trustee, to disgorge up to $23 million in fees Jackson Walker collected in cases involving Jones while it employed Freeman. The government says the breached its ethical duties by failing to disclose the relationship.

“Everything that has come out, including the more than 30 depositions taken in this case, thousands of pages of documents produced, and Ms. Freeman’s own statement to the US Trustee has consistently demonstrated that she misled Jackson Walker management about this relationship,” a Jackson Walker spokesman said Thursday.

‘Some Embarrassment’

Two days after Van Deelen told Cavenaugh about the anonymous letter, Polnick texted Cavenaugh that while there would be “some embarrassment” she felt it would “be ok,” and that they could “cover” until things passed.

A hearing on Van Deelen’s requested recusal of Jones was scheduled for March 10.

But Cavenaugh, accusing Van Deelen of “defamatory statements,” asked the court to seal the anonymous letter. Jones referred the motion to his colleague and mentor, Judge Marvin Isgur, who ordered the letter sealed until it could be admitted into evidence.

Cavenaugh confided that he barely slept the night before, partially because he spent three hours rereading all of his declarations in prior cases. Cavenaugh often signed the firm’s sworn bankruptcy court declarations requiring professionals to disclose connections to others parties.

Isgur allowed the letter to remain sealed, and wouldn’t allow the substance of the letter’s allegations to be discussed, calling it inadmissible hearsay.

By September 2021, Jones would also grant Jackson Walker’s motion to keep the letter sealed.

An attorney for Freeman declined to comment. Jones, Polnick, and Freeman didn’t immediately respond to emailed requests for comment.

‘Selfish Attitude’

With the letter’s allegations defused and the hearing behind them, Cavenaugh turned his ire at “400,” Jones’ nickname stemming from the number of his Houston courtroom. Jones had a “selfish attitude” and needed “independent advice,” he said.

“Between you and me, I’m very angry at 400,” Cavenaugh said in a text to Polnick. “Not because of what happened, but because of the dismissiveness of the issues.”

Attitudes like Jones’ “can only end in bad results for our friend,” and while Jones would be fine, Freeman wouldn’t, Cavenaugh told Polnick.

Amid the frustration, concern about potential public fallout brewed at Jackson Walker.

A day after Isgur rejected Van Deelen’s recusal, Cavenaugh told Polnick the firm had hired Texas-based public relations and crisis communications firm Androvett, and crisis communications expert Lisa LeMaster. Neither responded to requests for comment Thursday.

Appearances

By May 20, 2021, Polnick and Cavenaugh discussed that firm management committee member and partner C. Wade Cooper’s position that Freeman couldn’t have any part in Jones cases.

“Apparently wade only knows that they’re friends and socialize and while he may suspect more he apparently doesn’t know know,” Polnick told Cavenaugh.

Polnick seemed worried in her texts, alluding to Cavenaugh that she, among others, socialized with Jones yet continued to work on cases before him.

“It’s the past relationship. Not the current,” Cavenaugh responded. “You can’t unring that bell. It’s not the legal exposure. It’s the PR exposure. It’s not the existence of anything inappropriate. It’s the appearance that there might be or might have been. And the fact that they did so much to insulate themselves only informs that appearance.”