Bankruptcy Law

Ex-Dewey partner's $500K loan shouldn't be discharged because he lied about assets, bank says

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A Chapter 7 personal bankruptcy filing by a former partner of now-shuttered Dewey & LeBoeuf ordinarily would discharge unsecured loans.

However, in a complaint filed Monday in federal bankruptcy court in Connecticut, JPMorgan Chase says John Altorelli should still have to pay back all of the $500,000 he owes for a 2012 personal loan, because he lied about his assets when he sought an extension of the original one-year repayment period, reports the Am Law Daily (sub. req.).

Altorelli listed over $3 million in personal property in his extension application, including $150,000 in antiques, $250,000 in art, $325,000 in jewelry and a wine cellar worth $120,000, the bank’s complaint says. In his bankruptcy petition, Altorelli disclosed a total of less than $76,500 in personal assets. He listed no antiques, photos and paintings worth $1,000, $16,230 in jewelry and wine worth $8,100, the article reports.

Altorelli, who is now a practice leader at DLA Piper, and his lawyer declined the legal publication’s request for comment.

A number of former Dewey partners settled with the trustee in charge of the firm’s Chapter 11 bankruptcy case; however, Altorelli didn’t. He is facing a lawsuit by the trustee that seeks to claw back $12.9 million he received in compensation after Dewey allegedly had become insolvent.

Altorelli is expected to be a prosecution witness in a criminal case against former Dewey leaders in which jury selection is scheduled to start next week.

Related coverage: “Former Dewey rainmaker who earned $6M in 2011 files for bankruptcy”

See also:

ABA Journal: “How Dewey management’s rosy picture masked an ugly truth” “Bankuptcy trustee seeks $22M from 9 former Dewey partners in compensation clawback suits”

New York Law Journal (sub. req.): “Dewey Case Takes Shape Weeks Before Trial”

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