When Hawaiian real estate developer Aina Lea Inc. filed for bankruptcy late last month, it owed Greenberg Traurig, Nixon Peabody and several other law firms nearly $900,000.
And Aina Lea, the company behind an unfinished residential development on Hawaii’s big island worth a reported $1 billion, is now looking to hire a bevy of legal advisers, including Greenberg Traurig and Honolulu’s Choi & Ito, to guide it through a Chapter 11 case.
Aina Lea filed a Chapter 11 petition on June 22 in Hawaii federal bankruptcy court, listing estimated liabilities of between $10 million and $50 million against assets between $100 million and $500 million. Among a list of the real estate developer’s largest unsecured creditors, three of the top 10 are Am Law 200 firms. The company said it owed $253,685 to Nixon Peabody; $242,523 to Greenberg Traurig; and $77,621 to Pryor Cashman.
The real estate developer also listed debts of lesser amounts to several smaller law firms in Hawaii. Aina Lea said it owes $47,665 to the Hilo-based Nakamoto, Okamoto & Yamamoto; $44,741 to Honolulu-based Tom Watts Degele-Mathews & Yoshida; $44,200 to Honolulu’s McCorriston Miller Mukai MacKinnon; and $22,247 to Honolulu’s Morihara Lau & Fong, according to bankruptcy filings.
In addition, Aina Lea listed a disputed debt of $146,000 to New York-based law firm Gusrae Kaplan Nusbaum. That firm in March sued the real estate developer in Manhattan federal court, alleging Aina Lea was on the hook for legal fees owed to one of Gusrae Kaplan’s clients. The law firm represented Newbridge Securities Corp. in connection with its role as a placement agent for a proposed public offering by Aina Lea, which ultimately withdrew from its attempt to sell shares to investors.
Greenberg Traurig, one of Aina Lea’s top unsecured creditors, represented the real estate developer in the withdrawn public offering bid. That firm also appears as one of several legal advisers that Aina Lea is looking to hire for its bankruptcy proceedings, along with Choi & Ito and Nixon Peabody, according to a court filing.
Choi & Ito would serve as Aina Lea’s lead debtors counsel if approved by the bankruptcy court. In an employment application, the firm said its partner Chuck Choi has an hourly billing rate of $400, while partner Allison Ito’s hourly rate is $250.
Beyond the Aina Lea bankruptcy, Greenberg Traurig also features in a separate bankruptcy filed in Fort Worth, Texas, last month. In that case, surgical hospital owner Foundation HealthCare Inc. filed for Chapter 11 on June 21, listing a debt to Greenberg Traurig of $139,313.94 that put the firm among the company’s top 20 unsecured creditors.
In all, Foundation owed more than $400,000 to law firms on its list of largest unsecured creditors. The company listed a debt of more than $133,052 to Reed Smith, more than $102,060 to Goodwin Procter and a little more than $35,019 to the Oklahoma-based McAfee & Taft.
Husch Blackwell serves as debtors counsel for Foundation. In a court filing, the firm said the lead bankruptcy lawyer on the team, Vickie Driver, charges $475 per hour, while other bankruptcy lawyers have hourly rates of $375 and $335. A Husch Blackwell health care partner, Eric Weatherford, is also part of the team, charging $550 an hour for his work.
Scott Flaherty covers the business of law with a special focus on plaintiffs firms. He can be reached at email@example.com. On Twitter: @sflaherty18.