The Dreier Case is Moving Along

The Dreier Case is Moving Along - 3/11/2009

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HEADLINES \| SETTLEMENTS AND DISMISSALS \| COURT FILINGS LINKS TO OTHER NEWS \| NEWS ARCHIVE	HEADLINES ARCHIVED SETTLEMENTS AND DISMISSALS ARCHIVED

HEADLINE NEWS:

The Dreier Case is Moving Along
Zach Lowe

The Am Law Daily. March 11, 2009
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EXCERPT: We wrote last month about the concern among creditors in the bankruptcy of Marc Dreier's old firm that there won't be enough money around to repay both victims of Dreier's alleged criminal frauds and his firm's creditors. As you'll recall, the government has first dibs on any assets (cars, houses, Salma Hayek-related artwork) Dreier purchased with proceeds from his frauds--proceeds that may have totaled $400 million or more. The creditors in both his Chapter 7 bankruptcy and his former firm's Chapter 11 case come next. The first step, of course, is seeing exactly how much money Dreier and his defunct firm have, and that process is starting now, according to court papers filed this week; many of the details will be hashed out at a hearing in federal bankruptcy court on Thursday. The process starts with collecting all the bills from clients who owe Dreier LLP money. In all, Dreier LLP is waiting on bills totaling $34 million from about 1,000 clients, court records show, and the process for recovering that money is going to be complicated. The trustee for Dreier LLP's estate, Sheila Gowan of Diamond McCarthy, has crafted different payment plans depending on how much of the bill the clients will actually agree to pay. Clients who owe less than $50,000 or agree to hand over 90 percent of what Dreier LLP's records show they owe can make their payments via the trustee (Gowan) without court approval. Clients who owe more than $500,000 or who claim they only owe 65 percent to 89 percent of what their bills indicate have to OK their payments with the firm's committee of unsecured creditors (a group that includes Wachovia Bank, which has already sued Dreier LLP for millions in loans the firm blanched on).

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