Lehman Fees Could Reach $1.4 Billion
Oct. 23 (Bloomberg) -- Fees could reach a record $1.4 billion for lawyers, accountants and other professionals working on the [Lehman Brothers Holdings Inc.]("http://www.bloomberg.com/apps/quote?ticker=LEHMQ%3AUS") bankruptcy, the largest in U.S. history.
The biggest winner will be New York-based law firm [Weil, Gotshal & Manges]("http://www.bloomberg.com/apps/quote?ticker=1127L%3AUS"), Lehman's adviser, with an estimated $209 million in fees, said [Lynn LoPucki]("http://search.bloomberg.com/search?q=Lynn+LoPucki&site=wnews&client=wnews&proxystylesheet=wnews&output=xml_no_dtd&ie=UTF-8&oe=UTF-8&filter=p&getfields=wnnis&sort=date:D:S:d1"), who teaches bankruptcy law at Harvard University in Cambridge, Massachusetts. His projections are based on fees paid for other large bankruptcies, including the most expensive to date, [Enron Corp.]("http://www.bloomberg.com/apps/quote?ticker=ENRNQ%3AUS") Lehman, with debt of about $613 billion, will need a bankruptcy judge's approval for about $906 million in charges for professional services, LoPucki said. By comparison, court- approved expenses for the bankruptcy of Enron, the world's largest energy trader until its 2001 collapse, totaled $757 million, of which $149.4 million went to Weil.
``We're breaking new ground in the size of the fees,'' LoPucki said in an interview yesterday. ``Lehman is such a large case that there is a lot of money there. It's like the guy who robbed the banks because that's where the money was.''
LoPucki said the debtor will pay an additional $524 million of fees, most of which don't need prior court approval. These include fees to secured lenders and claims agents, as well as auditing fees unrelated to the restructuring.