Now in Legal Rebels:
Posted Mar 30, 2011 07:59 pm CDT
A Chapter 7 bankruptcy filing may be required to achieve a “decent burial” for the dissolving law firm once known as Adorno & Yoss, an observer tells the Daily Business Review.
And partners of the firm, known as Yoss after founding partner Henry “Hank” Adorno was suspended from practice last year, are unlikely ever to see their capital contributions of $30,000 to $100,000 returned, at least one admits.
But the dissolution process is expected to be straightforward, even in a potential bankruptcy, because Yoss partners reportedly are not personally liable to the bank that extended a line of credit of approximately $8 million or the firm’s landlords. That means Wells Fargo likely would get its accounts receivable in a bankruptcy and the landlord would get its office furniture and equipment.
“In all probability, they will file an action in circuit court for dissolution or a Chapter 7,” partner John Genovese of Genovese Joblove & Battista, who is watching the matter from the sidelines, tells the publication. “It doesn’t look to be particularly dramatic. The firm just needs a decent burial.”
While there are various claims that could be made against Yoss, it isn’t clear that doing so will result in any payout for potential plaintiffs. They include, in addition to Wells Fargo and landlords, vendors, recruiters and a former client pursuing a malpractice claim over an $11.3 million Internet defamation verdict. The plaintiff’s lawyers in that case say they intend to pursue a possible recovery via the Yoss firm’s malpractice coverage rather than bankruptcy court, the article reports.
Although partners voted to stay together after Adorno’s suspension last October, a lawyer representing the plaintiffs who had won a $1.5 million malpractice verdict against the firm, fearing that Adorno’s departure could signal financial trouble, garnished the money from a Yoss bank account. That led to bounced paychecks, and more financial turmoil followed, as some key clients and partners departed and the firm had trouble paying a number of obligations, including rent, vendor bills and partner draws.
ABAJournal.com: “‘Spectacular Fall’ for Name Partner Adorno, Now Facing Suspension for Class Action Settlement Role”
ABAJournal.com: “Former Head of ‘Closed’ Yoss Office: ‘I Left Because I Wasn’t Getting Paid’”
ABAJournal.com: “Up to 180 Lawyers Will Be Looking for Jobs with Dissolution of Yoss Law Firm”
South Florida Lawyers: “More Fun and Lawsuits at Adorno-less Yoss”