The legal dispute involving old Copper Company, formerly known as JCPenney, and the Texas law firm Jackson Walker LLP has taken another twist. The firm recently moved to dismiss a lawsuit stemming from its alleged failure to disclose a romantic relationship between a former partner and the judge overseeing JCPenney’s 2020 Chapter 11 restructuring.
This lawsuit, initiated by the plan administrator of JCPenney’s bankruptcy estate, seeks to recover legal fees paid during the proceedings. According to court documents, Jackson Walker argues that the lawsuit is making unwarranted claims over an extraordinary situation that had no substantial impact on the bankrupt estate.
Jackson Walker’s motion to dismiss was filed in the US Bankruptcy Court for the Southern District of Texas, stressing that the lawsuit is merely a veiled attempt to revisit settled matters without new grounds (“a second bite at the apple”). The law firm has also been reportedly settling other fee disputes that arose from their representation of JCPenney during its restructuring.
Earlier this year, JCPenney’s plan administrator sued the law firm in an effort to reclaim fees, contending that the romance between the firm’s ex-partner and the bankruptcy judge should have been disclosed, implying potential bias or conflict of interest. More details can be found in Bloomberg Law’s coverage of the ongoing litigation.