By John Council

Church Charity Sues Weil, Gotshal Over Bankruptcy Advice

New York-based Weil, Gotshal & Manges faces allegations that it negligently advised a nonprofit corporation to file bankruptcy in Texas and pursued a litigation plan designed to generate excessive fees for the firm rather than saving its client from financial ruin.

The allegations are included in National Benevolent Association of the Christian Church (Disciples of Christ), et al. v. Weil, Gotshal & Manges, a complaint filed in the U.S. Bankruptcy Court in San Antonio before Judge Ronald King. The nonprofit filed the suit on Sept. 14 as part of its Chapter 11 bankruptcy that is still pending in King’s court.

Palmer and other Weil, Gotshal lawyers advised NBA to file for Chapter 11 bankruptcy protection in San Antonio, where NBA owned a facility called Patriot Heights. NBA agreed, and filed the Chapter 11 bankruptcy in February 2004 – one of the largest Chapter 11′s ever filed by a nonprofit corporation, says NBA’s attorney, Daniel Sheehan of Dallas’ Daniel Sheehan & Associates. Read Full Story (registration required).

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