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John Gellene: A Bankruptcy Lawyer Goes to Jail

Elizabeth Gunn and Steven Rhodes

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Bankruptcy law requires that professionals seeking to be paid from the estate to publicly disclose their connections to the case.    In 1998, John Gellene, a former partner of the prestigious law firm now known as Milbank LLP, was found guilty for knowingly and fraudulently making false declarations under penalty of perjury.   In connection with seeking to be retained as debtor’s counsel in a bankruptcy case, Gellene failed to disclosure connections the firm had to creditors in the case.   His motivation for not disclosing these connections is that if he had his firm would likely have been disqualified from representing the debtor.    As a result of Gellene’s actions, Gellene served prison time and Milbank had to disgorge $1.8 million in fees.   In this episode, Judge Elizabeth Gunn and Judge Steven Rhodes will discuss the Gellene case, the bankruptcy laws requiring disclosures and more recent situations involving parties in bankruptcy cases failing to disclose connections.