With apologies for a bit of a blogging absence, and with great gratitude and thanks to the many risk professionals who joined us last month in San Francisco at Inception 2016, (and to the many readers who popped up and proffered the secret risk blog handshake, along kind words of encouragement), we now resume your regular, semi-regular updates – rejuvenated, renewed and risk-adverse as ever...
...But not without also apologizing to an unknown reader in Philadelphia, who made a point to corner a colleague of mine recently and ask when I’d get back on the horse over here. (Every reader matters, and those cards and letters do get read. So, your nudge has been received.)
...And also not without thanking the many industry risk experts who participated in formal panels and informal discussions and networking as part of the Tuesday Risk Roundtable track – an experience no fewer than two participants called “intimate” and “fabulous.”
Several developments and stories of note, so let’s get back into the swing of things. Giddy up.
"Caesars Bondholders Ready Lawsuit, Citing Examiner’s Report: Proposed legal claims could be worth more than $12 billion, court papers say" --
- “Paul, Weiss, Rifkind, Wharton & Garrison represented CEOC in the asset transfers, when it also represented the Caesars parents or affiliates and counted Apollo as a client. The court-appointed investigator said although the law firm “should have recognized” the conflict of interest in representing two companies on opposite sides of a deal, no evidence indicates that its lawyers intentionally sought to hurt CEOC or its creditors.”
- “The bondholders, however, say Paul Weiss should return the “tens of millions of dollars” in fees it received in light of the “profound” nature of its conflict of interest. They also are seeking the return of more than $1 million in fees collected by another CEOC law firm, Friedman Kaplan Seiler & Adelman, for the “obvious conflict” in its work representing both Caesars and CEOC in a lawsuit in which CEOC asked a court to declare that Caesars wasn’t liable for the asset transfers.”
- “While redevelopment plans for the Plantation Fashion Mall are moving forward under Art Falcone, a legal battle has emerged between the property’s previous owner and a law firm that claims it had nothing to do with the project.”
- “The suit was filed by Tangshan Ganglu Steel & Iron Co., a Chinese conglomerate that hoped to redevelop the Plantation mall, but lost the property during a bankruptcy auction in March 2015.”
- “At the center of the suit is an alleged conflict of interest from Becker & Poliakoff, according to the Daily Business Review. Tangshan said in the suit that the law firm represented both it and minority partner Weng Chen, who managed the mall’s three controlling controlling entities. Tangshan owned a 99 percent interest in the entities.”
- “After a falling out between Du and Chen, the suit alleges Becker & Poliakoff filed a document with a forged signature from Du that gave Chen control of the project. A Broward bankruptcy judge later ruled the signature was indeed a forgery, according to the Daily Business Review.”
- “In court documents, Steve Proctor, CEO of Nashville, Tenn.-based Edgenet, called Foley & Lardner LLP’s motion to withdraw from the litigation, filed against EdgeAQ LLC in the U.S. District Court for the Western District of Wisconsin, and a bill for presumably hundreds of thousands of dollars in fees a ‘complete surprise.’ EdgeAQ bought Edgenet in 2014... ‘After months of representing us, our current counsel informed us on Dec. 15, 2015 that they intended to file a motion to withdraw on Dec. 18, 2015,’ Proctor wrote in a Dec. 28, 2015 filing with the federal court.”
- “According to Proctor’s December letter to the judge, Foley & Lardner stated there was a conflict of interest between the firm and EdgeAQ. Foley & Lardner allegedly told EdgeAQ that the firm felt the company was “second-guessing” its strategy.”
- “To compound the complexity of the matter, when our current counsel filed the motion to withdraw, they requested an expedited consideration of the motion knowing that the date of the filing left EdgeAQ three business days to find replacement counsel before the Christmas holiday.”
- “Proctor said in his letter the company was ‘even more surprised’ when Foley & Lardner informed it -- for the first time -- on Dec. 21, 2015 that it also had a conflict due to the firm’s representation of Nate Herbst, the current CEO WTS Paradigm LLC, which is the plaintiff in the case against EdgeAQ.”
- “Jeffrey A. Simmons, a partner in the Business Litigation and Dispute Resolution, Distribution and Franchise, and Intellectual Property Litigation practices at Foley & Lardner, and who helped represent EdgeAQ, could not be reached for comment on the firm’s decision to drop EdgeAQ or its current policy on conflicts of interest.”