Everyone has been waiting for the shoe to drop in the Dewey & LeBoeuf Bankruptcy. In other words, when were the now defunct firm’s unsecured creditors going to start avoidance actions against shareholders whose bloated compensation packages sucked the firm dry of working capital? (You can see my initial thoughts here.) On Thursday, however, the Wall Street Journal reported here (subscription may be required) that short-term D&L partner Henry Bunsow (i.e., he started in 2011) is suing erstwhile firm chairman Steven Davis “and other leaders of the firm” for good old-fashioned fraud, for telling him that the firm “was doing very well financially.”
I’m sure there’s lots of more specific allegations of fraud, at least I hope so for Bunsow’s sake (FRCP 9(b) anyone?). Even so, Bunsow will probably get the same level of sympathy as last year’s striking NFL football players: millionaire players fighting battling billionaire owners. At least he’s taking the first shot, for what that’s worth.