Ethical Violations, Clawback Upheld in Howrey Bankruptcy

By Joyce E. Cutler, Bloomberg BNA

An attorney who represented creditors of the defunct Howrey LLP law firm lost his bid to overturn a bankruptcy court order to disgorge $30,694 in fees and the court’s findings that he breached fiduciary obligations to his former client, the official creditors committee.

Judge James Donato, U.S. District Court for the Northern District of California, rejected William McGrane’s arguments that U.S. Bankruptcy Judge Dennis Montali abused his discretion in a final fee order citing ethical conflicts in disallowing $46,325 in fees sought by McGrane and McGrane LLP (MLLP).

“None of McGrane’s and MLLP’s arguments ...