June 26, 2023
A recent Law 360 story by Henrik Nilsson, “Kirkland Seeks $13M Fees in 3M Unit’s Tossed Bankruptcy”, reports that Kirkland & Ellis LLP sought an Indiana federal judge's approval for nearly $13 million in fees and expenses for the firm's representation of 3M subsidiary Aereo Technology's bankruptcy case between February and April, days after the judge tossed the case upon finding the company financially healthy. Kirkland's request is its third interim fee application and comes on top of more than $30 million in total compensation the court has already approved for the firm's representation of Aearo Technologies LLC, which filed for Chapter 11 to address 230,000 liability claims of its allegedly faulty Combat Arms Earplugs Version 2, or CAEv2.
Kirkland seeks $12,641,180 in fees and $277,065 in expense reimbursement for the period Feb. 1 through April 30, saying the firm has spent significant time and resources responding to dismissal motions, settlement talks and a Seventh Circuit appeal. "This has required a significant expenditure of time and effort due, in part, to the vast number of Combat Arms claims alleged against the debtors, in parallel with the debtors' intensive preparations for the hearing on the dismissal motions," the firm said.
In total, Kirkland attorneys and paraprofessionals spent more than 11,777 hours during the fee period, according to the request. The firm said that it spent almost 8,000 hours for a total of $8.1 million on litigation involving adversary proceedings and contested matters between February and April. Kirkland dedicated 1,454 hours for a total of $1.7 million to develop a disclosure statement and reorganization plan in connection with the Chapter 11 cases, according to the request.
Kirkland charged Aearo a blended hourly rate of $1,073.30 during the fee period. The firm said the compensation is warranted given the complexity of the case and the time expended. "During the fee period, [Kirkland] provided extensive and important professional services to the debtors in connection with these Chapter 11 cases," the firm said. "These services were often performed under severe time constraints and were necessary to address a multitude of critical issues both unique to these Chapter 11 cases and typically faced by large corporate debtors in similar cases of this magnitude and complexity."