Just over a month after the City of Detroit filed for Chapter 9 protection with Jones Day at its side, another Am Law 100 firm has landed a key role in what is poised to become the largest municipal bankruptcy in U.S. history.
Dentons—the recently merged entity that brought together SNR Denton, European firm Salans, and Canada's Fraser Milner Casgrain—has been hired by an official committee of retirees given a voice in the case by the judge overseeing it, Dentons partner Carole Neville confirmed via email Wednesday. (News of the firm's entry into the case was first reported by The Wall Street Journal.)
Neville, a restructuring, insolvency, and bankruptcy partner in the firm's New York office, focuses her practice on representing creditor and equity committees in Chapter 11 bankruptcies and out-of-court restructurings, according to a bio on the Dentons website. The bio notes Neville's work on several airline bankruptices, including those of Aloha, Pan Am, Continental, and Frontier. She did not offer any further comment Wednesday on the firm's role in Detroit.
The U.S. trustee's office—a U.S. Justice Department unit that monitors bankruptcy proceedings—appointed a nine-member retiree committee in the Detroit case on August 22 at the request of U.S. Bankruptcy Judge Steven Rhodes, who must still approve the city's Chapter 9 petition. As the Detroit Free Press has previously reported, the committee includes three attorneys, including chair Terri Renshaw.
Dentons's fees for its work on the bankruptcy, like those earned by Jones Day and Detroit's local counsel, Miller, Canfield, Paddock and Stone, will be paid out of the city's threadbare coffers. All three firms' bills will be scrutinized by Chicago lawyer Robert Fishman, whom Rhodes appointed last week to serve as fee examiner in the case.
Detroit's 23,500 retirees have a considerable amount of money at stake in the case. Early estimates to determine how underfunded Detroit's pension plans are vary from the $640 million figure offered by counsel for the pension systems—which are among the dozens of parties to file objections to the Chapter 9 filing—to Detroit emergency financial manager Kevyn Orr's estimate of $3.5 billion.