Herbert Smith Freehills (HSF) took home £1.9m for legal advice in the seven months between 14 January and 13 July 2016 before settling the Nortel Networks bankruptcy case. Legal adviser fees in the long-running administration had already reached more than £2bn earlier this year.
After seven years of administration, EY announced yesterday (12 October) that an agreement has been reached on how to split proceeds from the sale of Nortel’s assets. The case has involved five years of litigation and four significant rounds of mediation, EY said.
Three groups of creditors, including 33,000 UK pensioners, Canadian pensioners and US bondholders, had been unable to agree who gets what from the $7.3bn to be distributed since the company’s collapse back in 2009.
According to a new report, EY’s lead adviser in Europe, HSF earnt £1.9m in legal fees between 14 January and 13 July 2016, making it the largest recipient in the list of advisers for the period. Among other firms engaged were Debevoise & Plimpton who received £200,000 and US based Hughes Hubbard & Reed who collected around £2.4m.
The HSF team was led by John Whiteoak who has advised since the Canadian telecoms giant filed for bankruptcy, alongside partner Kevin Pullen.
Whiteoak said: ‘HSF is incredibly proud to have been able to work for EY in this important and seminal mandate. We are very pleased to have assisted the client in bringing about this very significant settlement which, if the conditions are satisfied, will result in significant returns to the creditors of the European Nortel companies and has led to ground-breaking developments in international insolvency and pensions law.’
The settlement is conditional on court approvals in the US, Canada, UK and France, and will bring to an end years of litigation proceeds formerly described as ‘one of the most complex trans-national legal proceedings in history’.
Read more in the comment piece: ‘Guest post: How to run up a $1.6bn legal bill – the Nortel bankruptcy should be a wake-up call for the insolvency industry’