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Taking on corporate hero Aaron Feuerstein — the CEO who paid workers even after his factory burned down — might feel a little Grinch-like, even to lawyers. But Foley Hoag partner Andrew Schwartz relishes the challenge. “We’re street fighters who could get in Aaron’s face from day one,” he says of himself and his firm. And they have. Schwartz represents the committee of unsecured creditors in its proceedings against debtor Malden Mills Industries Inc., the Lawrence, Mass.-based maker of Polartec fleece that filed for Chapter 11 reorganization last November. When a fire destroyed its factory in 1995, Feuerstein paid employees while the factory was being rebuilt. The media heralded the now 76-year-old Feuerstein as a corporate anomaly, a CEO who valued his people above the bottom line. Since then, though, some questionable business decisions, general economic vicissitudes and unusually warm winters have landed the company with approximately $170 million of debt. Foley Hoag won a beauty contest to represent the committee of unsecured creditors. Now Schwartz is up against fellow Bostonian Richard Mikels of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, lead debtor’s counsel. In August, Malden Mills submitted a reorganization plan to Judge Joel Rosenthal of U.S. bankruptcy court in Worcester, Mass., that would pay back creditors over 10 years and keep Feuerstein as CEO. Schwartz and Mikels will now slug it out over this plan in hearings that will decide the company’s future — and Feuerstein’s role in it. Given Feuerstein’s public stature, this bankruptcy has an unusual public relations angle, one that both Schwartz and Mikels are trying to play, albeit to very different ends. For the debtors the task has been effortless. “The heartfelt response has been extraordinary,” says Mikels. Massachusetts senators and congressmen have come out in support of Feuerstein and Malden Mills, and consumers have sent in contributions to help out the struggling company, which had spent $25 million to pay idle employees during the factory shutdown. All this, says Mikels, shows that Feuerstein should be CEO. “Particularly in this day and age with Enron,” says Mikels, “Feuerstein is a real standout, well respected for his honesty.” But Schwartz sees beyond Feuerstein’s blinding halo. “The company is $170 million in debt,” he says emphatically, “and despite all attempts of Malden Mills, we don’t regard this as a shining example of corporate responsibility.” Feuerstein acknowledges his mistakes — including failing to patent its famous fleece and not amply diversifying its product line — but believes he is the man to turn the company around. “In the future we have to balance things out better,” he says, “and we are feverishly working on that right now.” To get beyond Feuerstein’s heroic persona, Schwartz has had to construct his own PR strategy. “The debtor is using political tools to advance its agenda,” he says, “so it’s been necessary for the committee to make sure its voice is heard too.” To this end, Schwartz says he has spent much time explaining bankruptcy law, and his client’s position, to reporters. Mikels wants the creditors to give Feuerstein the benefit of the doubt. “Our hope,” he says, “is that the creditors will hold out a helping hand to someone who’s held out his hands to help others — not just because it’s the right thing to do but because it’s in their economic interest.” But Schwartz is prepared to do battle. “When you represent the unsecured creditors,” he says, “you’ve got to be able to scratch and claw your way into the money.” Not your typical PR response, but, then again, niceness only goes so far in Schwartz’s business.

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