The fees in the Diamond Comic Distributors bankruptcy case and related litigation continue to mount: advisors billed nearly $900,000 for services provided in October. This is up substantially from the roughly $700,000 billed in September (see “Another $700K in Diamond Fees”).
Once again, it’s the adversary cases before the bankruptcy court that are driving up the fees, making Diamond attorneys Saul Ewing LLP the largest bill again in October with $426,415 in fees and expenses, up over $50,000 from September. There was one positive development in October, as the parties agreed to mediation to settle the disputes around Diamond’s attempts to seize and sell consignment inventory in its warehouse (see “Parties Agree to Mediation”), which presumably will be considerably cheaper than proceeding to trial.
On the other hand, the litigation between erstwhile Diamond acquirer Alliance Entertainment and Diamond Comic Distributors and related companies, investment bank Raymond James, restructuring consultants Getzler, Henrich & Associates LLC (along with Chief Restructuring Officer Robert Gorin personally), and Alliance Game Distributors co-CEOs Charlie Tyson and Dan Hirsch appears to be headed to trial, after the judge recently denied motions on both sides to dismiss the claims and counterclaim (see “Bankruptcy Court Denies Motions to Dismiss”).
Restructuring consultants Getzler Henrich & Associates LLC also billed a larger amount in October, and their billing detail shows that over a third of the fees were for “Litigation Matters & Support,” indicating that the adversary cases are costing money in non-attorney fees as well.
And the creditors also have an interest in the disputes; he Unsecured Creditor Committee’s attorneys Tydings & Rosenberg LLP and Lowenstein Sandler LLP and consultants Berkeley Research Group LLC billed $36,377, $55,345, and $15,724 respectively.
Total legal, banking, and consulting fees in the bankruptcy and related cases now total around $16.6 million, reducing amounts available to pay creditors. And, of course, those amounts don’t include the fees paid by Diamond’s creditors individually; those are additional costs of the bankruptcy not visible to the public.
Source: ICv2
