With at least 114 lawyers--nation's largest-ever government bankruptcy--also one of most expensive

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OUR VIEW: With at least 114 lawyers on the case, the nation's largest-ever government bankruptcy is almost certain to also be one of the most expensive
Published: Thursday, January 05, 2012, 8:34 AM Updated: Thursday, January 05, 2012, 8:38 AM
By Birmingham News editorial board The Birmingham News

Bankruptcy expert Kenneth Klee is being paid $975 an hour by Jefferson County officials to advise them during their Chapter 9 proceedings. That's a handsome sum. But one lawyer does not a bankruptcy make. Neither do a dozen, when the bankruptcy is the largest government bankruptcy in U.S. history.

One hundred lawyers isn't even enough, in the case of Jefferson County and the more than 4,000 creditors with skin in the game. Try 114 lawyers, representing the county, creditors and other parties, such as the U.S. Securities and Exchange Commission and the state court-appointed receiver over the sewer system, John S. Young. And even more lawyers are expected to join the ranks as the bankruptcy proceeds and attorneys are appointed to represent unsecured creditors and everyone else who is owed money by the county.

There are so many lawyers that U.S. Bankruptcy Judge Thomas Bennett apologized "for the space limitations" after moving into temporary space because of renovations to the Robert Vance Federal Courthouse. Some lawyers listened in by phone.

For anyone wondering why county officials estimate the county's legal costs during bankruptcy will top $1 million a month, all he needs consider is the number of lawyers. Fifteen of the 114 on the case are representing the county.

County taxpayers and sewer ratepayers must hope the bankruptcy doesn't drag out two, three or even more years. But they shouldn't expect any miracles along the way.
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