Folks, it’s amazing how sunlight acts as a disinfectant for
corruption. TransPerfect won the right to see the bills in their Chancery Court
case, but I think it’s only because they used a lawsuit in Nevada to
successfully shed a spotlight on what Bouchard was doing, which in any other
court would be deemed corruption in my view.
After four years, and, from what I understand from sources
at the company, $14 million later, he is finally allowing TransPerfect to see
itemized invoices from his old law firm, Skadden Arps for work allegedly
performed by Chancery Court-appointed Custodian Robert Pincus.
That all sounds nice but the order has not been signed and
in my view, there is no chance Bouchard is going to rule against his former
colleagues at Skadden Arps and order them to produce a real itemized bill. If
he did, he would risk exposing 4-years of court-sanctioned money siphoning from
TransPerfect while also risking folks seeing potentially padded Skadden bills.
I think Bouchard wants the public to believe that he is
being transparent, but nothing that has happened in this case has been
transparent and there is no reason to believe anything would change now. Why
has the court-appointed custodian wanted his bills to be hidden in the first
place? And why did Bouchard threaten to hold TransPerfect in contempt with a
$30,000 a day fine if they didn’t withdraw their lawsuit in Nevada? In my
opinion, the only answer that makes sense to me folks is that there is
something to hide.
If there is nothing to hide, why is the custodian fighting
to keep his bills a secret? Why hasn’t Bouchard ordered him to turn over his
bills without lawyers spending thousands of dollars telling him why? The only
conclusion I can see is that in my opinion, Bouchard is protecting his Skadden-buddy
Pincus.
If the court doesn’t order a custodian to turn over his
bills to the company that is paying those bills, then there is no transparency.
When will the corruption end?!
Please read the Delaware Business Court Insider article
below, which recaps the initial news from Bouchard to open up Skadden’s bills.
The story explains the latest events.
As always, your comments are welcome and appreciated.
TransPerfect, Shawe Win Bid to Access Details of Skadden Bills Incurred by Custodian
The ruling, which Bouchard said he planned to formally enter
later this week, ratcheted down tensions in a two-state standoff between
Shawe’s legal team and attorneys for Robert Pincus, the court-appointed
custodian in what has become Delaware’s most vexing legal drama.
By Tom McParland | October 21, 2019
Despite being held in contempt last week, TransPerfect Global Inc. has won its Chancery Court bid to access the details of bills being paid to the former Skadden, Arps, Slate, Meagher & Flom partner appointed to oversee the company’s court-ordered sale.
Chancellor Andre G. Bouchard said Monday that he would grant
a request by the New York-based translation services company and its CEO,
Philip Shawe, to see what type of work it was being charged for, as well as the
billing rate, time spent and positions of the Skadden attorneys working on the
case.
The ruling, which Bouchard said he planned to formally enter
later this week, ratcheted down tensions in a two-state standoff between
Shawe’s legal team and attorneys for Robert Pincus, the court-appointed
custodian in what has become Delaware’s most vexing legal drama.
The latest spat centered on bills Pincus submitted for some
expenses he incurred following the 2015 sale, including costs related to two
lawsuits in New York state and federal court stemming from the sale.
Shawe, who won the court-mandated auction following a bitter
battle with company co-founder Elizabeth Elting, argued that he should be able
to see a full list of itemized expenses, and TransPerfect altogether refused to
pay two disputed bills from June and July. The company then sued Pincus in its
new home-state of Nevada, seeking a declaration that it was under no obligation
to indemnify Pincus for his role as a former tie-breaking director of
TransPerfect.
Pincus responded by asking Bouchard to hold TransPerfect in
contempt for trying to undermine the Chancery Court’s exclusive jurisdiction
over the case.
On Oct. 17, Bouchard agreed that TransPerfect had
“intentionally and willfully violated court orders and said he would fine
TransPerfect $30,000 per day if the company did not dismiss its Nevada suit by
Monday. However, that ruling did not touch on TransPerfect’s gripes about
Pincus’ billing.
In a brief telephone conference with counsel Monday morning,
Bouchard said he would grant TransPerfect’s request out of “practical concerns”
that TransPerfect had raised, even though he disagreed with the company’s legal
analysis. Under the order, TransPerfect would be able to challenge the bills in
court.
Nothing in the ruling, he clarified, was meant to walk back
his ruling on contempt. “There’s a right way and a wrong way to do things,”
Bouchard said. “Seeking to undermine the court’s exclusive jurisdiction in the
wrong way.”
Attorneys for TransPerfect said after the hearing that they
had gotten all they wanted with regard to billing and confirmed that they
would, in fact, withdraw the Nevada suit before the end of the day.
Because of the victory today in Delaware, we are withdrawing
the Nevada suit,” Shawe’s lawyer, Martin Russo of Kruzhkov Russo in Manhattan
said in a statement. “There is no fine, no contempt, and there is finally going
to be clarity on Skadden Arps’ billing, as we had called for.”
Shawe, likewise, said the ruling was a “major win for
transparency and openness in the Delaware courts” and that Skadden’s billing
would now be subject to “some level of review.” A spokesman confirmed that
TransPerfect still intended to appeal last week’s contempt ruling.
Skadden, which represents Pincus, said the firm was “pleased
with the court’s well-reasoned decisions, which adopt Skadden and Mr. Pincus’s
position that TransPerfect and Mr. Shawe are in contempt, were in violation of
applicable fee orders, and should be permitted access to invoices, but only in
accordance with appropriate procedures.”
Monday’s ruling followed an escalation in rhetoric aimed at
Bouchard over his handling of the TransPerfect case. Shawe and his team have
been fiercely critical of Bouchard throughout nearly five and a half years of
litigation. Last month, however, a TransPerfect-linked group ran a television
ad in the Delaware market calling out Bouchard’s wealth and connections as part
of a pressure campaign aimed at keeping him from being nominated to an opening
on the state Supreme Court.
The Delaware legal community was swift in its condemnation
of the ad and its message, calling it nothing more than an unwarranted attack
seeking retribution against the chancellor.
Shawe’s spokesman has denied any involvement on the part of
his client, and the group’s leader said it had taken no money or direction from
Shawe.
Still, Russo said last week that Bouchard has a “bone to
pick” with Shawe.
“Why hasn’t the chancellor recused himself,” he asked
rhetorically, in a statement.
Bouchard did say Monday that he would wait until at least
late Wednesday to officially enter his billing ruling, after David Finger,
Shawe’s Delaware counsel, said he would be withdrawing from Shawe’s team.
Contacted by phone Monday, Finger, of Finger & Slanina,
said his decision was related to “confidential attorney-client” interactions,
but declined to comment any further.
An attorney for TransPerfect said he believed “there is
something in the works” and that Shawe planned to substitute counsel within one
to two days.