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Law firm of bankruptcy judge's girlfriend did not make standard disclosure in at least 27 cases, report says

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GettyImages-Judge David R Jones

Judge David R. Jones, a Texas bankruptcy judge, in August 2020. Jones resigned earlier this month after an ethics complaint alleged that he had an “intimate relationship” with a lawyer who financially benefited from cases before him. Photo by Brett Coomer/The Houston Chronicle via Getty Images.

An analysis by Reuters has concluded that Texas bankruptcy law firm Jackson Walker failed to disclose whether it had checked for connections between its lawyers and judges in at least 27 cases.

Elizabeth Freeman, who was in a romantic relationship with U.S. Bankruptcy Judge David R. Jones of Houston, was a partner at Jackson Walker from 2018 until she left the firm in December 2022. The couple lived together “since approximately 2017,” according to an ethics complaint filed against Jones before he resigned earlier this month.

Since 2018, Jackson Walker filed 30 applications in Houston to represent debtors with at least $1 billion in debt, according to a Debtwire list reviewed by Reuters. Jackson Walker indicated in only three of those cases that it had searched for connections to judges, and that none was found. The firm didn’t make the same statement in the other 27 cases.

A bankruptcy rule requires firms in bankruptcy cases to list potential conflicts based on connections to debtors, creditors and “parties in interest.” Judges aren’t mentioned, but it was “standard practice” at larger firms working with Jackson Walker to indicate whether judge connections were found, the article reports.

Eight legal experts told Reuters that Jackson Walker could face allegations of violating bankruptcy rules if the firm knew of the relationship and did not disclose it. Violating the rules could lead to disgorgement of fees and even criminal prosecution in rare cases, the experts told Reuters.

Reuters also reports that Freeman worked as a contract lawyer for Jackson Walker after leaving the firm.

“In April,” Reuters reports, Freeman “secured a key role in a mediation overseen by Jones to wind down insurance services provider GWG Holdings, a job that started at $100,000 a month. Jones and Jackson Walker signed off on the arrangement without disclosing the relationship, court papers show.”

The Department of Justice’s U.S. Trustee Program is reviewing the mediation and has asked to pause approval of Jackson Walker’s fees in the case. It is also reviewing a second mediation in which Freeman participated.

Jones has said he didn’t think that he had to disclose his relationship with Freeman because he wasn’t married to her, he didn’t financially benefit from her legal work, and she didn’t appear in his courtroom.

Jackson Walker said in a previous statement it first learned of an alleged romantic relationship between Jones and Freeman in March 2021. The firm said it investigated, talked to outside ethics experts, and told Freeman that she should not work or bill for work on cases involving Jones.

According to Reuters, Jackson Walker “did not identify the ethics experts it consulted or say what it learned from the investigation.”

A Jackson Walker spokesperson declined to comment when contacted by Reuters.

See also:

“Texas bankruptcy judge questioned over relationship with local lawyer”

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