UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK ----------------------------------------------------------X Hearing Date: In re Time: Chapter 11 THE WARNACO GROUP, INC., et al. Case Nos. 01-B-41643 (RLB) Debtors. through 01-B-41680 (RLB) Jointly Administered -----------------------------------------------------------X FINAL APPLICATION FOR ALLOWANCE OF COMPENSATION AND REIMBURSEMENT OF EXPENSES BY JASPAN SCHLESINGER HOFFMAN LLP, SPECIAL COUNSEL TO THE OFFICIAL COMMITTEE OF UNSECURED CREDITORS PURSUANT TO 11 U.S.C. 330 TO THE HONORABLE RICHARD L. BOHANON, UNITED STATES BANKRUPTCY JUDGE: Jaspan Schlesinger Hoffman LLP ( JSH ), special counsel to the Official Committee of Unsecured Creditors, (the Committee ) of The Warnaco Group, Inc., et al. ( Warnaco or the Debtors ), does hereby submit this Application (the Application ) for allowance of final compensation and reimbursement of expenses pursuant to 11 U.S.C. 330. In support of this Application, JSH represents and alleges as follows: 1. On June 11, 2001 (the Petition Date ) voluntary petitions for reorganization under Chapter 11 of title 11 of the United States Code (the Bankruptcy Code ) were filed by the Debtors. The Court entered an Order Directing Joint Administration of the Debtors thirty-eight (38) Chapter 11 cases (the Cases ). 2. No trustee has been appointed in these Cases. 3. On June 19, 2001, the United States Trustee ( U.S. Trustee ) for the Southern District of
New York appointed the nine (9) member Committee pursuant to Section 1102(a)(1) of the Bankruptcy Code. The firm of Otterbourg, Steindler, Houston & Rosen, P.C. was retained as counsel to the Committee ( Committee Counsel ). 4. JSH was retained by the Committee as special counsel effective as of October 9, 2001, pursuant to an order dated April 18, 2002. JSH s APPLICATION 5. During the period of October 9, 2001 to February 3, 2003 (the Application Period ), JSH has expended 232.82 hours in rendering professional services to the Committee. The total normal time charges for the legal services rendered to the Committee by JSH for this period are $56,100.55. The mixed hourly rate for the services performed is $240.96 per hour. JSH is also seeking reimbursement of its expenses in the amount of $2,405.43 necessarily and reasonably incurred in the performance of its duties on behalf of the Committee. GENERAL DESCRIPTION OF SERVICES RENDERED 6. During the period of JSH s representation of the Committee, the services rendered can be summarized as follows: (a) JSH reviewed documents in their efforts to determine any other claims, defenses, and/or causes of action against the Pre-Petition Lenders with respect to Pre- Petition indebtedness and Pre-Petition liens. (b) JSH reviewed and analyzed the benefit of any potential claims to be asserted against the pre-petition Lenders as compared to a settlement of any issues raised. (c) JSH advised the Committee in reaching an agreement on the terms of a global 2
settlement of all issues relating to the Pre-Petition Lenders. (d) JSH analyzed and reviewed motions seeking relief from the automatic stay as filed by inter alia, HIS Equipment, Ford Motor Credit Company, and Speedo. (e) JSH reviewed and analyzed the principal terms and conditions of settlement of the claims of GECC against the Debtors. (f) JSH participated in extensive discussions with the Debtors, Debt Coordinators, and the Committee s professionals regarding the settlement with GECC. (g) (h) JSH attended various court hearings pertaining to these issues. JSH prepared and electronically filed its First Interim Application for Compensation and Reimbursement of Expenses. SUMMARY OF TIME 7. Attached as Exhibit A is a copy of JSH s time records including a summary of the expenses incurred by JSH in rendering professional services. An analysis of the time spent by the members, associates, legal assistants and paraprofessionals employed by JSH is listed on the Summary Sheet, annexed as Exhibit B to this Application. The recording of such time expended and the calculation of such disbursements were contemporaneous with the services rendered and were recorded and charged according to the same billing procedures used for comparable services in non-bankruptcy cases. 8. JSH s attorneys have assiduously and diligently performed in these Chapter 11 cases on behalf of the Committee. JSH s attorneys have performed necessary and valuable professional legal services for the Committee. Substantial services were performed by the following individual: Harold D. Jones. Mr. Jones is a partner in the Bankruptcy Department of JSH and has 3
specialized in bankruptcy law since 1979. Prior to joining JSH, he was the United States Trustee for New York, Connecticut, and Vermont. During his tenure he was involved in many of the largest Chapter 11 cases filed in the country. Mr. Jones is a member of the American Bar Association - Business Law Committee, former member of the Board of Directors of the American Bankruptcy Institute, and the Business Reorganization Committee of the Association of the Bar of the City of New York. Mr. Jones is a frequent lecturer and author in the bankruptcy field. Steven R. Schlesinger. Mr. Schlesinger is the managing partner of JSH and specializes in the areas of election and commercial litigation. He graduated from Hofstra University School of law in 1976 and is admitted to practice in the U.S. District Courts for the Eastern and Southern Districts of New York. Mr. Schlesinger has served as Law Chairman for the Nassau Democratic County Committee and as a member of the Special Committee of the New York State Bar Association on the reform of election law. Mr. Schlesinger is currently a member of the Litigation Committee of the American Bar Association, the New York State, and the Nassau County Bar Associations. Stanley A. Camhi. Mr. Camhi is a partner in the Litigation Department of JSH and specializes in the area of general civil litigation. Mr. Camhi graduated from Emory University Law School in 1975, with honors. He is admitted to practice in the United States Supreme Court; the Second, Sixth, and Eleventh Circuit Courts of Appeal and the District of Columbia; and the District Courts for the Eastern and Southern Districts of New York, Northern District of Georgia, and the District of Columbia. Mr. Camhi is a member of the New York State and Nassau County Bar Associations. 4
Christopher E. Vatter. Mr. Vatter is an associate in the Litigation Department of JSH and graduated from Touro College, Jacob D. Fuschsberg Law Center in 2001 where he was editor of the Touro Law Review. He is admitted to practice in the State Courts of New York and New Jersey, and is a member of the New York and New Jersey State Bar Associations. Lisa M. Golden. Ms. Golden is a partner in the Bankruptcy Department of JSH and has broad experience representing secured and unsecured creditors, creditors committees, and financial institutions in the areas of Bankruptcy, insolvency, and commercial law. She has represented and continues to represent a full spectrum of commercial and business clients in major bankruptcy reorganizations. Ms. Golden is admitted to practice in the U.S. District Court for the Southern and Eastern Districts of New York. STANDARDS FOR COMPENSATION 9. This Application for compensation is pursuant to 330 of the Bankruptcy Code. The Standard provided by 330(a)(1) is reasonable compensation for actual, necessary services rendered by the... attorney.... Pursuant to 330(a)(3)(A) [I]n determining the amount of reasonable compensation to be awarded, the court shall consider the nature, the extent, and the value of such services, taking into account all relevant factors, including - (a) (b) (c) the time spent on such services; the rates charged for such services; whether the services were necessary to the administration of, or beneficial at the time at which the service was rendered toward the completion of, a case under this title; 5
(d) whether the services were performed within a reasonable amount of time commensurate with the complexity, importance, and nature of the problem, issue, or task addressed; and (e) whether the compensation is reasonable based on the customary compensation charged by comparably skilled practitioners in cases other than cases under this title. 11. JSH s hourly rates are the rates customarily charged all clients of JSH. JSH has charged the Committee solely on an hourly basis for the actual numbers of hours expended. 12. The factors traditionally followed in quantifying reasonable compensation under the standards of 330(a)(1) were derived from the seminal decision in Johnson v. Georgia Highway Express, Inc., 488 F.2d 714 (5 th Cir. 1974), which enunciated the so called twelve Johnson factors. In arriving at the standard which the Courts now employ, the policy underlying the Bankruptcy Code is to provide for full and fair compensation to qualified attorneys, because they serve as the lubricant that makes the bankruptcy system work. In re King Resources, Inc. 652 F.2d 1349, 1352 )10 th Cir.) cert. denied, 454 U.S. 881 (1981). 13. JSH submits that an award of final compensation for services rendered and disbursements incurred is justified under the standards established by 330 of the Bankruptcy Code and relevant caselaw, including Unsecured Creditors Committee v. Pugent Sound Plywood, Inc., 924 F.2d 955, 957-958 (9 th Cir. 1991) (in reviewing fee applications, court must determine (i) whether the services are properly compensable as legal services, (ii) whether the services were necessary and properly documented, and (iii) whether the services were performed within a reasonable amount of time), Harman v. Levin, 772 F.2d 6
1150, 1152 n.1 (4 th Cir. 1985) (factors of time and labor expended, the novelty and difficulty of questions raised, the skill required to perform legal services, the attorneys opportunity costs in pressing litigation, the customary fee for like work, the attorneys expectations at the outset of the litigation, the time limit imposed by the client or circumstances, the amount in controversy and result obtained, the experience, reputation and ability of the attorney, the undesirability of the case, the nature and length of the professional relationship between attorney and client, and attorneys fees in similar bases are properly considered in determining attorney fee awarded in bankruptcy). APPLICANT S QUALIFICATIONS AND ENTITLEMENT TO COMPENSATION 14. JSH by experience, training and ability is fully qualified to perform the services for which compensation is sought. JSH consists of approximately 40 attorneys and is engaged in virtually every facet of major commercial practice. Over the years, JSH has handled major litigations, real estate transactions, corporate and bankruptcy proceedings, tax, labor and trusts and real estate matters. JSH s clients include many publicly held companies. 15. JSH s hourly rates are the rates customarily charged all clients of JSH. JSH has charged the Committee solely on an hourly basis for the actual number of hours expended. 16. Tested by the standards mentioned herein, it is respectfully submitted that JSH is entitled to the allowance of compensation and reimbursement of expenses in the amounts requested. 17. JSH respectfully submits that the professional services rendered were necessary to protect the interests of the creditors and the estates and such services were reasonable, necessary and beneficial to the estates herein. 7
18. Pursuant to 11 U.S.C. 504 and Rule 2016, no agreement or understanding exists between JSH and any other entity for the sharing of compensation received or to be received for services rendered as to be rendered in connection with this case. 19. In accordance with the Administrative Order regarding Guidelines for Fees and Disbursements for professionals in the Southern District of New York Bankruptcy Cases (the Administrative Order ) annexed hereto as Exhibit C is a certification of Harold D. Jones (the professional designated by the Applicant with the responsibility for compliance with the Administrative Order) that: Mr. Jones has read the Application; to the best of Mr. Jones knowledge, information and belief formed after reasonable inquiry, the Application complies with mandatory guidelines set forth in the Administrative Order; to the best of Mr. Jones knowledge, information and belief formed after reasonable inquiry, the fees and disbursements sought are billed at rates in accordance with practices customarily employed by applicant and generally accepted by applicant s clients. The Debtors, the Committee and the United States Trustee have been provided with a copy of this Application 20. Except as set forth herein, no previous application has been made to this or any other Court for the relief requested herein. WHEREFORE, JSH respectfully requests the entry of an Order allowing final compensation pursuant to 11 U.S.C. 330 in the amount of $56,100.55 for professional services rendered to and 8
on behalf of the Committee and allowing reimbursement of JSH s actual and necessary out-of-pocket expenses in the amount of $2,405.43, and such other and further relief as may deem just and proper. Dated: Garden City, New York February 27, 2003 JASPAN SCHLESINGER HOFFMAN LLP Special Counsel to the Official Committee of Unsecured Creditors By: s/harold D. Jones Harold D. Jones (HDJ 4652) A Member of the Firm 300 Garden City Plaza Garden City, New York 11530 (516) 746-8000 SLM/D278150v1/F037455 9