So the DA is investigating Dewey, but hasn't determined if there was a crime committed. Maybe I spoke too soon about no one going to jail.
Dewey & Leboeuf LLP, the New York law firm fighting to stay alive after more than 70 partners left,
is the subject of a criminal probe by state prosecutors into whether managers misled partners about payments due them, a person familiar with the matter said.
The investigation by Manhattan District Attorney Cyrus Vance Jr. is in a preliminary stage
and has yet to determine whether a crime has been committed, said the person, who declined to be identified because the matter isn’t public.
http://www.bloomberg.com/news/2012-04-2 ... probe.html
Erin Duggan, a spokeswoman for Vance, declined to comment. Angelo Kakolyris, a spokesman for Dewey,
didn’t return a call seeking comment on the probe. Yesterday, he declined to comment on the deadline.
The law firm said today in a copy of an internal memorandum obtained by Bloomberg News that it is aware of an investigation by Vance’s office,
has begun an internal probe and plans to cooperate with the district attorney.
And the NY Times as well:
http://dealbook.nytimes.com/2012/04/27/ ... -chairman/
The Manhattan district attorney’s office is investigating allegations of wrongdoing by Steven H. Davis,
the former chairman of the troubled law firm Dewey & LeBoeuf, the firm said on Friday.
Dewey acknowledged the investigation in an internal memorandum sent to its partners.
The firm said that it has asked two of the firm’s partners to conduct its own internal investigation into the allegations.
A group of Dewey partners presented evidence to the district attorney about supposed financial improprieties by Mr. Davis,
leading the office to open an investigation. The inquiry is said to be in its early stages and Dewey is fully cooperating with the criminal probe, the firm said.
Mr. Davis did not return telephone calls and e-mails seeking comment.
And the WSJ reports which two partners (bold added):
http://blogs.wsj.com/law/2012/04/27/man ... -chairman/
According to the memorandum, the investigation is focusing largely on the firm’s former chairman, Steven H. Davis,
who led the firm from 2003 until several weeks ago, when his responsibilities were diminished in a management shakeup.
A call to Mr. Davis at his office was not immediately returned.
The firm has asked two of its lawyers, Harvey Kurzweil and Seth Faber, to conduct an internal investigation
into the situation, the memorandum said.
“In addition, we have been in contact with the District Attorney’s Office and have told the District Attorney’s
Office that the Firm intends to cooperate with that Office’s investigation,” according to the memorandum.
A spokeswoman for the Manhattan district attorney’s office, Erin Duggan, declined to comment.
And Reuters says the investigation is into "financial irregularaties"
http://www.reuters.com/article/2012/04/ ... 6D20120427
The Manhattan District Attorney's office is investigating whether Dewey leadership made misleading statements
about payments due to partners, according to one person who did not want to be identified because the probe is not public.
Another person, who also did not want to be identified, said lawyers from the firm had asked Manhattan District Attorney
Cyrus Vance to examine "financial irregularities" at the firm.
Both sources said the investigation is in preliminary stages.
I am wondering why the partners would go to the DA in the middle of a negotiation with their lenders. Do they need to bring a complaint before the bankruptcy is filed? I would think criminal investigations can be made at any time. Could they be worried about records being lost or destroyed? Having a criminal investigation should end any hope the lenders would work with you. Maybe they realized they couldn't get agreement from the lenders, so they decided to go report criminal activity before the firm shuts down?
It just seems like terrible timing for (some of )the partners to bring in the DA now.