A recent law.com story, “Firms Defend Their Work in Dodgers Bankruptcy Against Trustee’s Attack” reports that the U.S. Trustee overseeing the bankruptcy case of the Los Angeles Dodgers has objected to about $350,000 in legal fees and expenses, arguing that work billed by attorneys to obtain financing over the summer was “not reasonably likely to benefit” the baseball team.  The Dodgers’ lawyers at Dewey & LeBoeuf (D&L) and Young Conaway, Stargatt & Taylor (YCST), in a response defended their actions, which they insisted ended up benefitting the Dodgers.

U.S. Trustee Roberta A. DeAngelis in Wilmington, Del. has objected to the fee request.  The trustee has taken issue with a portion of the fees tied to a proposed financing arrangement designed to meet the team’s payroll.  D&L submitted its fee application, seeking more than $1.7 million in compensation and about $32,000 in expenses.  Of that, more than 2,000 hours, and $1.1 million, were spent on attempts to obtain immediate financing.  In its fee application, YCST sought more than $267,000 in compensation and $41,000 in expenses.  The proposed financing deal accounted for more than $104,000 or 256 hours.

Mark Kenney, trial attorney in the trustee’s office argued that D&L compensation should be reduced by $312,000 and YCST by about $41,000, “on account of services rendered that were not necessary to the administration of these cases.”  He added that the work provided no benefit to the team.

Under the proposed financing arrangement, the Dodgers sought court approval for a $150 million deal from Highbridge Principal Strategies, a hedge fund.  Under the terms of the deal, the Dodgers would have paid a $5.25 million closing commitment fee and $4.5 million deferred commitment fee.  Major League Baseball countered with a competing offer that excluded such fees, the Dodgers attorneys continued to negotiate for the Highbridge deal, according to Kenney.