November 25, 2024
Business

Judge OKs fees for GNP lawyers Bedard invoice not yet approved

BANGOR – Former Great Northern Paper Inc. co-owner Lambert Bedard will not be paid $37,776 right away for consulting services in the month after he put the paper company into bankruptcy.

Instead, U.S. Bankruptcy Judge Louis H. Kornreich has set a Dec. 12 hearing where he would like evidence presented on what exactly what the services were that Bedard performed between last Jan. 9 and Feb. 5.

Kornreich will decide whether Bedard’s invoice for services qualifies as an administrative charge, which would entitle Bedard to immediate payment, or whether his bill is similar to those of other unsecured creditors. The hearing will begin at 1 p.m. Dec. 12 at U.S. Bankruptcy Court in Bangor.

It is unknown whether Bedard will be at the hearing to defend his invoice.

Kornreich’s decision on Bedard came during a Wednesday afternoon hearing where attorneys for Great Northern’s bankrupt estate, the official committee of unsecured creditors and other professional services companies presented invoices of more than $2 million for their work during the bankruptcy.

The three-hour hearing was a parade of one attorney after another defending his services and justifying his invoices, and eventually just about every invoice was approved once revisions were made to them to comply with Maine’s laws pertaining to the amount that can be charged for photocopies and faxes.

The hearing also was a revealing session about the pressures the attorneys were under to resurrect Great Northern’s two shutdown mills and salvage any number of the 1,130 jobs that were lost with the bankruptcy. According to the attorneys, Gov. John Baldacci wanted daily updates on whether progress was being made to get the mills up and running again, and he was involved in the decision-making on whether particular legal strategies were in the best interest of the Millinocket area.

Where Baldacci’s influence was brought up the most during Wednesday’s hearing was during a “David vs. Goliath” battle between Jay Geller, a Portland attorney representing the creditors committee, and Alex Terras, a Chicago attorney representing Boeing Capital Corp., Great Northern’s primary creditor that was owed more than $50 million.

Geller’s invoice of $203,000 was being challenged by Boeing, which loaned Great Northern the money to pay attorneys fees. Geller, in defense of his bill, said it was evident from the beginning of the case that Baldacci wanted to limit the financial ramifications Great Northern’s bankruptcy would have on Maine’s economy. Geller said he undertook legal strategies, including a couple of lawsuits, to try to secure even a small amount of money to pay the paper company’s unsecured creditors, many of whom are in Maine.

“There were public policy considerations that were stronger than any other case I’ve been involved in,” Geller said.

But Terras countered that “whether for civic reason or public policy reasons,” Boeing believed that Geller undertook legal work that “was unnecessary” because it became apparent last Feb. 5 that it was unlikely that Great Northern’s unsecured creditors would receive any money.

In support of Geller, U.S. Assistant Trustee Robert Checkoway of Portland said Geller’s legal performance was commendable on behalf of creditors given the obstacles that he encountered. Checkoway said he would not have wanted to be the one to “face the creditors committee and tell them they can’t have access to the governor.

“If I was a creditor and the governor had his hand on the case, I would want the creditors committee’s attorney in the room,” Checkoway said.

Kornreich approved Geller’s invoice without any reservation. Kornreich even acknowledged that during the bankruptcy case, he overruled many of Geller’s legal efforts.

“The fact that the committee did not prevail does not mean that [the work] was unnecessary,” Kornreich said.


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