Linklaters' high-profile role on Lehman Brothers' bankruptcy is set to become one of most lucrative mandates in European legal history with the U.K. giant now regularly billing more than 1 million pounds a week.
The Magic Circle firm has confirmed that its role advising U.K. administrator PricewaterhouseCoopers is currently engaging "several hundred" of its fee earners.
PwC itself has already confirmed that its 300-strong Lehman team is generating weekly fees of 4 million pounds ($5.9 million). Legal counsel typically generate between a third and half of the fees of administrators, suggesting a fee level for Linklaters of more than 1.25 million pounds ($1.8 million) a week.
In addition, partners at another law firm involved with Lehman's administration have indicated the complexity of the mandate means that Linklaters' fees have approached the $800,000 to $1 million mark on busy days.
The level of fees means that Lehman is almost certain to surpass the size of previous big ticket U.K. insolvency mandates such as the restructuring of British Energy, which generated more than 25 million pounds in fees for Clifford Chance by the time it completed in 2005.
However, the fees are still dwarfed by the level of fees typical on complex restructuring work in the U.S. with the controversial bankruptcy for Enron concluding in 2005 with a total adviser bill of nearly $700 million.
The Linklaters team, which is thought to include more than 20 partners, is being led by restructuring chief Tony Bugg and banking partners Richard Holden and David Ereira.
Linklaters has so far refused to comment on fees. However, some costs are expected to be disclosed with the administrators set to produce status reports to creditors at least every six months.
Creditors were set to meet on Wednesday to discuss fees, among other matters, which they will have to agree with the administrators.
One partner close to the process commented: "There has been a negative attitude to Linklaters' role on Lehman but I suspect most of it is just jealousy. Lehman is a God-send in this climate. There is a recognition that they need to throw bodies at this."
Separately, a second case against Lehman for a return of assets was last week dismissed. The case was brought by four unnamed private investment funds represented by 24 Old Buildings' Francis Tregear QC and Marcus Staff, instructed by Brown Rudnick, with Linklaters instructed for the respondents. The case follows an earlier attempt by hedge fund RAB Capital, represented by Simmons & Simmons, to claim assets, which was also dismissed.
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