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Baker Botts Earns Historic Fees in Bankruptcy Case

August 23, 2011 | Posted in : Bankruptcy Fees / Expenses, Fee Award, Fee Award Factors, Lodestar

A recent WSJ.com story, “Baker Botts Fees Upheld in Asarco Case” reports that a federal judge in Texas upheld fees paid to Baker Botts, LLP of $113 million, plus $6 million for expenses, for its handling of the 2009 Asarco LLC bankruptcy.  The four-year litigation ended with the full payment of all creditors’ claims, plus interest and legal fees.  In his ruling, Richard S. Schmidt, U.S. bankruptcy judge for the Southern District of Texas in Corpus Christi, praised Baker Botts’s work in what he described as “probably the most successful Chapter 11 of any magnitude” in the history of the Bankruptcy Code.

Judge Schmidt even lavished a fee enhancement of $4 million for Baker Botts’s efforts that he called “instrumental in producing the exceptional results that were unanticipated at case commencement.”  Lead Baker Botts trial lawyer in the case was jubilant.  “I’ve been trying cases for 39 years and I’ve certainly heard judges criticize plenty of lawyers,” said Irv Terrell.  “That’s a good feeling for a lawyer to feel like he earned his fee, and the court even rewarded us for exceptional performance.”

Baker Botts’s attorney fees aren’t the biggest paid to a U.S. law firm in a bankruptcy case.  Both the Enron collapse and Lehman Brothers’ failure generated attorney fees approaching $1 billion for the law firms involved.