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Bankruptcy, Third Party & Professional Liability

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Diamond McCarthy represents corporations, creditors’ committees, shareholders, trustees, secured and unsecured creditors, court-appointed trustees and others in bankruptcy litigation as well as parties involved in disputes arising from business dissolutions or restructurings. Our premier practice is known for its ability to handle virtually every type of litigation arising from financially distressed and insolvency situations.

We handle disputes between partners, business entities and the holders of their equity and debt securities, licensees, business entities and third party contract entities, as well as conflicts between business entities and their own officers, directors and professional advisors.

We identify what factors are at the heart of a company’s failure, including misappropriation of corporate assets and opportunities, and intentional, reckless or negligent breaches of fiduciary, contractual or other duties. Our well-regarded forensics area includes investigations into RICO, the Lanham Act, trademark and other statutory torts, fraud and misrepresentation, securities fraud, fraudulent transfers and other bankruptcy court causes of action. Many of our lawyers also have backgrounds as accountants, certified fraud examiners and MBA's, which provides our clients with a broad spectrum and depth of experience in tackling these issues.

Diamond McCarthy trial lawyers are known for cases with important and long-ranging legal repercussions, often involving issues of first impression before the courts. The Firm currently is lead counsel in the three largest law firm bankruptcy cases in U.S. history, the Dewey LeBeouf, LLP, Howrey, LLP and Heller, LLP bankruptcy cases.  Diamond McCarthy partner, Allan Diamond, is the court-appointed Chapter 11 bankruptcy trustee in the San Francisco based Howrey bankruptcy case in which cutting edge issues of first impression facing the legal profession as well as leasing markets have been litigated and are currently on appeal in the Ninth Circuit.  The Firm also has made cutting edge new law in the Dewey Lebeouf law firm bankruptcy action under New York law and cutting edge issues under California law are the subject of a pending appeal before the Ninth Circuit in the Heller law firm bankruptcy.  

Diamond McCarthy was lead special trial counsel in the Southeast Bancshares bankruptcy in Miami, Florida in which the litigation and asset recoveries made that case the most successful Chapter 7 bankruptcy in United States histor.  In this bankruptcy creditors received a 100% distribution of principal as well as pre and post petition interest and equity receiving distributions.  

The Firm also was lead counsel for the Chapter 11 bankruptcy Trustee in Dreier, LLP, in its bankruptcy proceedings pending in the Southern District of New York (the Trustee appointed by the U.S. Department of Justice was a Diamond McCarthy LLP partner in its NY office). That prominent case involved the Ponzi scheme perpetrated by lawyer Marc Dreier and is one of the largest fraud/Ponzi scheme case(s) involving the legal profession in U.S. history. The fraudulent scheme involved losses to hedge fund investors and others of more than $750 million. Diamond McCarthy’s representation of the Trustee included the prosecution of many high profile lawsuits against the recipients of fraudulent transfers and preferences, often involving legal issues of first impression before the federal courts. In addition, our representation in the case has pioneered new roads challenging the complex issues facing the intersection of criminal and civil government forfeiture proceedings, SEC Receivership and bankruptcy proceedings. The Firm’s work in the Dreier case resulted in one of the largest and most successful coordination agreements between a bankruptcy estate and the United States government involving asset seizure and forfeitures in U.S. history. 

The Firm has been involved in some of the largest, high profile corporate bankruptcy cases involving accounting irregularities, fraud and breaches of fiduciary duties in the world including Enron (LJM2), Italian dairy conglomerate, Parmalat, and many others.  Please see our website for a complete listing of representative bankruptcy related litigation cases.