Bankruptcy Law

In wake of $16.6M bill, judge asks Jones Day to explain disclosure of confidential Detroit docs

Updated: A federal bankruptcy judge asked Jones Day during a Monday court hearing to explain why some 120 confidential documents about closed-door mediation sessions were sent on computer disks to creditors of the mega-firm’s client, the city of Detroit, along with documents the creditors were supposed to receive.

Partner Geoff Irwin blamed the inadvertent disclosure, in a May 6 mailing, on “reviewer error,” reports the Detroit News.

Still undetermined is how to correct the mistake.

One creditor, municipal bond insurer Assured Guaranty, asked Judge Steven Rhodes to order the city to request creditors to return the computer disks, and then replace them with disks containing only non-confidential documents, reports the Detroit Free Press.

However, Irwin told the judge that creditors should be allowed to work with the current disks while the city prepares new ones, so the case is not delayed. Not all of the 120 documents contain confidential information, he said.

Rhodes told the parties to work together to figure out a fix, the Free Press reports.

“This is a major problem that needs to be solved today,” the judge said.

Jones Day billed the city for $16.6 million in legal fees and another $733,000 in expenses over a six-month period, the Detroit News reported last week.

The total cost to the city over that period, including consultants and expenses, was $36.3 million, a record high for a municipal bankruptcy, the newspaper says.

See also: “Detroit runs up $13.7M bill in first 75 days of bankruptcy case”

Updated at 12:05 p.m. to include and accord with subsequent Detroit Free Press coverage.

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