Posted May 31, 2012 03:06 pm CDT
The judge overseeing the bankruptcy of Dewey & LeBoeuf has agreed to release cash held by secured creditor JP Morgan Chase a day after he balked at the request.
On Tuesday, U.S. Bankruptcy Judge Martin Glenn had refused to release the collateral because he disliked lenders’ demand for a lien on the proceeds of future litigation in exchange for its use. On Wednesday, Glenn released the money to help pay for the wind-down, according to the Wall Street Journal Law Blog and the Am Law Daily.
In his order on Wednesday, Glenn didn’t allow the lender lien on litigation proceeds, but said he would revisit the issue if the banks aren’t repaid.
Dewey has estimated it needs $8.6 million of the funds for operations in the next three weeks, the Am Law Daily says.