My attorney costs how much!!?? Sports Authority bankruptcy fees top $1,000 an hour


Sports Authority’s demise is bad news for landlords left with 40,000-square-foot holes in their shopping centers, and for consumers faced with one fewer discount-happy retailer. But it’s great for bankruptcy attorneys.

Eight lawyers from the New York firm of Gibson, Dunn & Crutcher LLP are collecting more than $1,000 an hour to represent the debtors and debtors-in-possession in the Delaware bankruptcy case, according to court documents. They are:

  • Mitchell Karlan: $1,295 an hour
  • Robert Klyman: $1,215 an hour
  • Dennis Arnold: $1,110 an hour
  • David Battaglia: $1,110 an hour
  • Jennifer Bellah Maguire: $1,110 an hour
  • Robert Blume: $1,090 an hour
  • Matthew Williams: $1,060 an hour
  • Cromwell Montgomery: $1,055 an hour

The attorneys are part of an army of bankruptcy specialists who billed $1.91 million in hourly fees for March alone, a sum the firm discounted to $1.8 million. The lowest hourly fee — $380 — was billed by an “e-discovery specialist.”

Another firm, Irell & Manella LLP of Newport Beach, California, has two attorneys collecting $1,135 an hour. A third firm, Young Conaway Stargatt & Taylor LLP of Wilmington, Delaware, is charging fees that top out at $780 an hour.

Why so much? Partly because bankruptcy law is specialized. Here’s how Stephen Lubben, a professor of bankruptcy law at Seton Hall University, explained the economics to me in 2013:

From a common-sense perspective, the idea that you’re spending a lot of money to go bankrupt is counterintuitive …┬áIn bankruptcy, there’s very little incentive for management to be thrifty. They will be criticized if things go poorly, but they will never be criticized for spending too much money on professionals.

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