It’s
been
an
eventful
year
for
Willkie
Farr
&
Gallagher.
The
firm
bent
the
knee
to
Donald
Trump,
pledging
$100
million
in
pro
bono
payola
to
avoid
having
to
stand
up
to
the
administration’s
attack
on
Biglaw.
That
decision
didn’t
sit
well
with
the
firm’s
own
attorneys,
triggering
a
mass
exodus
of
West
Coast
partners
who
fled
to
Cooley
rather
than
work
for
a
firm
they
saw
as
compromising
the
rule
of
law.
BRC
Group
Holdings
(the
company
formerly
known
as
B.
Riley
Financial)
filed
a
$735
million
lawsuit
against
Willkie
this
week,
alleging
the
firm
aided
and
abetted
a
fraud
in
connection
with
a
2023
take-private
deal
involving
Franchise
Group,
the
company
that
runs
Pet
Supplies
Plus.
According
to
the
lawsuit,
fraud
was
like
catnip
for
Franchise
Group
founder
Brian
Kahn,
who
the
plaintiffs
allege
ran
a
“sophisticated
fraud”
to
secure
funds
that
helped
him
pay
off
debts
incurred
defending
against
a
different
hedge
fund
fraud
where
he
ultimately
pleaded
guilty.
Kahn’s
wife
is
also
named
in
the
new
suit.
BRC
and
its
co-plaintiffs
seek
disgorgement
of
Willkie’s
fees.
Willkie’s
relationship
with
Kahn
has
been
star-crossed
for
a
while.
Last
February,
a
Delaware
bankruptcy
judge
removed
Willkie
from
serving
as
bankruptcy
counsel
for
Franchise
Group
after
amidst
concerns
about
the
firm’s
conflicts
of
interest.
As
the
judge
noted
at
the
time,
Willkie
failed
to
create
any
ethical
walls
until
after
the
conclusion
of
the
take-private
deal,
meaning
all
the
knowledge
gained
by
the
firm
from
that
transaction
was
properly
“imputed
to
the
firm
as
a
whole.”
Now
BRC,
who
led
the
equity
financing
for
the
take-private
deal
wants
its
money
back
and
sees
Willkie
as
partly
responsible
for
duping
them
in
the
first
place.
But,
hey,
we’re
finally
not
talking
about
the
firm
signing
away
its
integrity
to
the
Trump
administration
so
look
on
the
bright
side!
Joe
Patrice is
a
senior
editor
at
Above
the
Law
and
co-host
of
Thinking
Like
A
Lawyer.
Feel
free
to email
any
tips,
questions,
or
comments.
Follow
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Joe
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