Now in its 17th month of bankruptcy, Enron has hired 48 law firms, accounting firms and other specialized professionals nursing it through the process. Some of the law firms are helping the creditors committee and an examiner studying causes of the company's collapse.
Legal and other expenditures billed to the company now exceed $318 million, far more than it cost to build the ballpark formerly known as Enron Field.
By some estimates, the total legal bill for Enron's bankruptcy could exceed half a billion dollars. It is already the most expensive bankruptcy ever.
On Thursday, Enron bankruptcy lawyer Brian Rosen sought to retain Venable, Baetjer and Howard to help resolve complicated energy trading contracts Enron negotiated before its bankruptcy.
Rosen's firm, Weil, Gotshal & Manges, Enron's primary bankruptcy law firm, has billed the company $60 million for its work so far, not including as-yet unsubmitted invoices for recent work.
As Enron filed for bankruptcy on Dec. 2, 2001, Weil sought a law firm specializing in complicated energy matters and brought in Cadwalader, Wickersham & Taft to handle the contract negotiations. Through Jan. 31 Cadwalader has billed $7.8 million.
But in some instances, the law firms Enron hired could have conflicts of interest, such as representing a counterparty. So the day after Enron filed for bankruptcy it hired Togut, Segal & Segal to handle such situations. Togut has billed $4.9 million through last December.
Less than a year and a half of bankruptcy, and they've burned through over $300 million with a half-billion dollars clearly in sight. Too bad Enron employees had to lose their life savings and 401(k) retirement money, so that what little was left of the company's fortunes could be funneled to 48 hand-picked firms.
Forget medical malpractice reform. We should look into Republican campaign contributor reform instead. It's apparently a very deep trough, circled by the squeals and oinks of America's most venerable legal professionals.
Aside to Ken Lay: How are your bankruptcy-immune annuities holding up in this bear market? All investors, even small ones with under a hundred million dollars, are facing the same twin problems — the corporate governance crisis you created, and your candidate's oil war — both of which are holding down the Dow and S&P indexes. Those caches of Weapons of Mass Campaign Contributions you made from your insider trades might be safer in Switzerland or the Cayman Islands — but you already knew that.
Anyway, if the media ever jogs itself from its war-induced amnesia and notices that you and Jeff Skilling are still running free, there are two words that you must repeat as often as necessary because they are guaranteed to get those pesky but easily distractable journalists off your back: Martha Stewart.
