A recent American Lawyer story, “Willkie Fees in Hospital Bankruptcy Draw Renewed Scrutiny,” reports that questions persist over the $15.3 million in fees and expenses paid out to law firms—including Willkie Farr & Gallagher, Alston & Bird and Nixon Peabody—and other advisors that worked on the 18-month Brooklyn,NY-based Interfaith Medical Center (IMC) bankruptcy proceedings.  The bankruptcy racked up $14.8 million in fees and $510,000 in expenses.

U.S. Trustee William Harrington, who in July asked for more than $700,000 in reductions in fees and expenses from several of the advisers.  In December, Willkie, along with the creditors’ counsel Alston & Bird and special corporate and health care counsel Nixon Peabody, agreed to reduce their bills by $214,000 collectively, receiving U.S. Bankruptcy Judge Carla Craig’s approval. (The hospital’s financial adviser, CohnReznick, which received withering criticism about excessive expenses, cut its request for $3 million by $150,000.)

Willkie had billed $5.5 million and $59,000 for expenses during its 18-month engagement.  The Dormitory Authority—a major bond issuer and lender to state hospitals, and Interfaith’s debtor-in-possession lender—sought a 15 percent fee reduction from the firm over a five-month period from February 2014 to June 2014, in contrast to a 5 percent reduction from Alston & Bird for the same period.  (It is unclear whether the authority sought a reduction from Nixon Peabody.)

Harrington echoed complaints lodged by the Dormitory Authority’s lawyer, David Neier at Winston & Strawn.  He asserted that approximately $150,000 in work billed by its partner, Alan Lipkin at a rate of $1,130 an hour could have been done by a lower-billing lawyer during the bankruptcy.  (In the five-month period ended June 19, Lipkin alone billed his client a total of $784,333, with the trustee requesting the firm shave $50,000 off that total; overall, Lipkin billed at least $1.8 million.)

An analysis of the court records filed by the firms shows that Willkie deployed far fewer attorneys on the matter than either Alston & Bird or Nixon Peabody.  Willkie deployed five partners, with billing rates ranging from $875 to $1,200 per hour, and seven associates, ranging from $540 and $815 per hour.  Most of Interfaith’s work at Willkie—nearly 700 hours in five months, or an average of 35 hours per week—was done by Lipkin at a rate of $1,130; his chief deputy, and associate, billed 517 hours during the same period for $770 per hour.

In comparison, Nixon Peabody deployed 17 partners at rates ranging from $465 to $965 per hour and 19 counsel and associates at rates ranging from $245 to $560 per hour; Alston & Bird divided the work between eight partners at hourly rates ranging from $545 to $865 and six associates during ranging from $470 to $680 per hour.

The trustee also cited thousands of dollars of examples in Willkie’s time sheets where descriptions were overly vague or work appeared to be duplicative, and asked that thousands of dollars that the firm billed for the preparation of monthly fee statements and responses to fee objections be stricken.

Ultimately, Willkie agreed to a $125,000 reduction in its final request for fees—a 2.3 percent trim; and the judge approved some $5.275 million in fees to the firm.  “We were pleased that Judge Craig found the U.S. Trustee’s objections to be meritless,” the firm said in a statement.  “Among other things, the U.S. Trustee’s objection ignored the fact that Willkie provided a voluntary fee reduction to IMC as an accommodation and that Willkie’s efforts played a significant role in IMC’s successful reorganization.”