Thursday, February 23, 2012

Waller Lansden received retainer payments from Church Street Health Management totaling $400,000 between September 28, 2011, and February 17 of this year.

Read at AM Law Daily

Church Street Health Management

The embattled operator of roughly 70 Small Smiles dental centers in 22 states filed for bankruptcy in Nashville on February 20, listing assets of $895.3 million against liabilities of $303.4 million, according to Bloomberg.

Several years ago, an ABC News investigation accused Small Smiles of mistreating children, something the company vehemently denied. But Small Smiles did reach an agreement with the Justice Department in 2009 to pay $24 million over five years to settle charges that it had billed Medicaid for unnecessary dental procedures performed on low-income children, according to the Nashville Business Journal.

Bankruptcy court filings by Nashville-based Church Street Health Management, the parent company for Small Smiles, show that Waller Lansden Dortch & Davis chair John Tishler ($550 per hour), corporate partner Don Moody ($450), and restructuring partner Kathleen Stenberg ($370) are representing the company in its Chapter 11 case.

Waller Lansden partners are billing between $290 and $600 per hour, of counsel between $150 and $650, and associates between $190 and $335, according to court records, which note that the firm has represented Church Street since 2006 and is thus familiar with the company's operations.

Waller Lansden received retainer payments from Church Street Health Management totaling $400,000 between September 28, 2011, and February 17 of this year. Those payments, according to court filings, were zeroed out on February 20 when the debtor paid the firm $382,000 in fees and $18,000 in expenses. Between January 1, 2011, and February 20, 2012, Waller Lansden was paid more than $1.2 million for its work on behalf of Church Street.

Foley Hoag litigation partners Kenneth Leonetti ($589.50), James Dillon ($616.50), and Martin Pentz ($652.50), all of whom are based in Boston, have petitioned the court to serve as special litigation counsel to Church Street, according to court filings. Those filings reveal that Foley, which has agreed to shave 10 percent off its normal hourly rates for its work in the case, is billing out associates between $320 and $525 per hour.

Court records also show that Foley received nearly $110,226 in various payments between January 24 and February 17. That sum was applied against retainers totaling $204,669 paid out during the same time period. All told, Foley holds a retainer in the amount of $94,443.37 from the debtor.

[Doesn’t all the money going to these law firms have a funny odor about it? Considering their long time champs are on the ‘creditor list’.]

According to a list of Church Street's 20 largest unsecured creditors, the company owes $310,700 to Shearman & Sterling in San Francisco. Court records show that Church Street expects to sell its Small Smiles businesses in bankruptcy.

According to court documents, most of the Nashville members of CSHM have moved from the “Members” list of the LLC to the list of “Creditors”. Gone are Steven Adair, who just made the list in 2011. Gone are Michael Lindley and Al Smith as well.  Like Adair, they can be found on the newly filed top twenty creditor list.

The new name found on the list is Sheila Sawyer, their in house counsel.  Funny that she is now a “member” of Church Street Health Management, LLC when a few short months ago she was a “partner” at Waller Lansden, purportedly a “big fan” of Small Smiles Dental Centers. I dunno, but it sure seems that Waller Lansden is the only law firm getting paid, and paid well!! Their name keeps cropping up over and over, even advising in the purchase of all the Small Smiles dental centers rights to defraud Medicaid from the DeRose family.

BTW, that $24 million they were to pay as a “settlement” has NOT been paid!!!  I wonder if the DeRose’s got all their money.  Hmmm..  I guess maybe they should hold off on that new jet they need after crashing their other one the night before Super Bowl Sunday.  Just say… 

Is it my imagination or have all the Carlyle Group “members” of the CSHM, LLC suspiciously missing.