Struggling retail chains shopping for law lawyers in what might well become the year of the retail bankruptcy saw several of their ailing brethren dip into the Big Law ranks this month for a trio of Chapter 11 cases.
Wachtell, Lipton, Rosen & Katz, a firm not known for advising debtors in bankruptcy court, appears to have a role in one such case. The New York-based firm was named in a July 5 press release issued by designer denim purveyor True Religion Apparel Inc. announcing its agreement with lenders on a prepackaged bankruptcy proceeding.
The deal, which will see the upscale jeans maker reduce its debt load to $535 million and close at least 27 underperforming stores, resulted in True Religion’s Chapter 11 filing in Delaware on July 5, the same day that Wachtell and national bankruptcy boutique Pachulski Stang Ziehl & Jones were touted by the Manhattan Beach, California-based company for their roles advising on its restructuring.
Alas, while a federal court case once permitted a peak into Wachtell’s mysterious billing structure, the True Religion bankruptcy might not yield a similar window into the secretive firm’s earnings apparatus. Wachtell’s relationship with True Religion stems from the company’s $835 million acquisition in 2013 by investment management firm TowerBrook Capital Partners LP. (Ante Vucic, one of the lead Wachtell partners advising TowerBrook on that deal, left the firm earlier this year.)
Wachtell lawyers have yet to enter appearances for TowerBrook or True Religion in the latter’s bankruptcy case. A Wachtell spokesman did not return a request for comment on whether the firm would do so in the future, nor did TowerBrook general counsel Glenn Miller. Ilene Eskenazi, in-house legal chief at True Religion since late 2013, recently left the company and is now global general counsel and head of human resources for the Americas at Boardriders Inc., a Huntington Beach, California-based sporting retail company that emerged from bankruptcy last year with a new name and new private equity ownership. She also did not return a request for comment about the Chapter 11 case involving her former employer.
Pachulski Stang name partner Laura Davis Jones is working with partners David Bertenthal and James O’Neill as lead bankruptcy counsel to True Religion, which has blamed the rise of “athleisure” wear as undermining its business. Neither Jones nor O’Neill responded to a request for comment about Wachtell’s role in True Religion’s bankruptcy case, one in which court filings show that Pachulski Stang partners are billing between $625 and $1,245 per hour, of counsel between $575 and $995 per hour and associates at hourly rates ranging from $450 to $595. Pachulski Stang received payments totaling $2.35 million from True Religion in the year prior to the company’s Chapter 11 petition, according to a declaration by Jones.
Delray Beach, Florida-based wedding dress retailer Alfred Angelo Inc. also filed for Chapter 7 liquidation Friday in nearby West Palm Beach. The abrupt collapse of the national bridal chain, which is poised to close 61 stores, unnerved brides and surprised some bankruptcy lawyers, as noted by sibling publication the Daily Business Review. Florida’s Stearns Weaver Miller Weissler Alhadeff & Sitterson has grabbed the lead restructuring role advising Alfred Angelo, although the firm has not yet filled billing statements with the bankruptcy court.
Beaulieu Group LLC, one of the nation’s largest carpet makers, also filed for bankruptcy Sunday in Rome, Georgia. Court filings show that Atlanta’s Scroggins & Williamson has been hired as bankruptcy counsel to Beaulieu, while McGuireWoods is seeking to serve as special corporate counsel to the Dalton, Georgia-based debtor. Neither firm has yet filed billing statements with the bankruptcy court.