Legal News

Patton Boggs to the Rescue! (Provided, Of Course, it Gets Paid)

By Ashby Jones

If it weren’t already pretty obvious, the situation involving Allen Stanford and his lawyers has gotten pretty dire. Earlier this week, we blogged the news that the financier, accused of helping mastermind a $7 billion Ponzi scheme, had traded the highly-regarded Houston lawyer Dick DeGuerin for the similarly highly-regarded Washington lawyer Robert Luskin, of Patton Boggs.

In light of that news, however, one question plagued us. If Stanford was dropping DeGuerin because he couldn’t pay him, what, exactly, was the arrangement with Luskin? Was Luskin willing to take the case in the hope of getting paid down the road? Would Patton Boggs, Luskin’s firm, work the case for free?

Well, we’re not sure it’s entirely cleared up, but we have part of our answer. In a filing made Tuesday to the federal magistrate judge in Houston, Patton Boggs and Houston’s Sydow & McDonald, indicated they were inclined only to get involved in the case for the limited purpose of trying to free up some of Stanford’s assets. If unsuccessful, they’d drop out.

According to the filing:

The Firms and Mr. Stanford have . . . agreed that Patton Boggs’ appearance in this case is contingent on obtaining a court order allowing the Firm to enter a limited appearance as described above. Therefore, if the Court does not consent to the terms described above, the Firms and Mr. Stanford have agreed that Patton Boggs shall not otherwise enter an appearance in the case.

In a related matter, Bloomberg reports today that in a separate filing yesterday in the SEC case, the receiver in the case, Ralph Janvey requested payment of $7.6 million in legal fees and expenses to cover his work as receiver from April 13 to May 30. The request follows one for $20 million to pay for Janvey's first eight weeks on the Stanford case. Janvey said the accounting and law firms working with him continue to discount their services by 20 percent.

Full post as published by Law Blog - WSJ.com on August 05, 2009 (boomark / email).