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Is anyone surprised that the lawyers who guided “old” GM into the dustbin of history scored $255,555 a day for 90 days? The $23 million price tag seems like small beer to me. According to The Detroit News, “AP Services, headed by Al Koch, who doubles as the chief restructuring officer of GM’s bankruptcy estate, had a team of 153 people working on GM’s bankruptcy case, and several charged $835 an hour in June.” Fair enough, you know, for a $50 billion-plus taxpayer “investment.” Besides, AP dropped their rates when the Justice Department bitched about them to a federal judge. Of course, the move wasn’t retroactive. But then, why would it be?
10 Comments on “Bailout Watch 589: GM C11 Lawyers Score $23m...”
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…who said the rates were unreasonable and might not leave enough money to cover claims.
Just lawyers doing what they do best.
I don’t know about you, but I’d feel better with a few lawyer jokes about now.
Sure, Airhen:
Q: Why is the scuba diving attorney in the picture above being left alone by the sharks?
A: Professional courtesy
I’m pretty sure that AP Services and Al Koch are not acting as counsel. AP is likely an affiliate of AlixPartners, a restructuring firm (focused on operations and selling assets, not providing legal advice). My guess is that Weil or one of the other bankruptcy players is counsel. And also guessing that those bills will be material.
$23M is way less than a typical law firm percentage given the billions involved. $23M paid cash is way better than say $200M in GM old stock or new IPO. If the C11 paperwork is botched, guess who’s going to knock on AP Services door.
$23 MM is what GM was losing in 7 hours last year. That’s a pretty good tradeoff for receiving a hefty taxpayer injection.
one thing i love about TTAC is the sharp selection of pictures to match the story. This one is pretty much as expected but sharp nonetheless.
You might want to see how much the accounts people are charging too.
Didn’t someone predict the legal fees for a GM bankruptcy would be near $100 million?
Lehman Brother’s European Division alone has cost so far some 112 Million in legal fees. Isn’t the entire bankruptcy for Lehman amount to 800 million?
I remember the Treasury required firms to limit themselves to 20 million total for GM’s bankruptcy to be over quickly.
Who the F cares about GM. The real wheeling and Dealing was Goldman Sachs leveraging 30-1 the 70 billion they got from taxpayers to corner the commodities market. They’re paying some $22 billion in bonuses this year. What about next year? probably $45 billion all in the middle of the worst economic downturn since the great depression.
How much is the pay for being shark chum nowadays?
AP was hired by “old” GM – management of GM to guide them through “bankruptcy”. Management retained jobs (almost all of them except Wagoner), got percentage of the company and 50 billions from government to run the company into the ground again. I think AP provided invaluable services to their client. If dept of justice had more professional scheisters who could master living in fast lane and not on government coin, they would charge $800/hr. Alas, they aren’t of the same caliber, so they bitch.
Sorry Robert, I think I repeated what you just wrote.