US court warns more Jackson Walker cases could be tainted by relationship with judge
DBD•A Houston bankruptcy judge ordered Jackson Walker to explain why it should not be sanctioned for failing to disclose its work on Diebold Nixdorf’s 2023 bankruptcy. The judge ordered the firm to list by October 15 all cases in which it appeared before former judge David Jones.
1. Court seeks case list
Chief US Bankruptcy Judge Eduardo Rodriguez ordered Jackson Walker to explain why it failed to disclose its work for Diebold Nixdorf in the 2023 bankruptcy to the court or authorities scrutinizing its fees in cases involving former US Bankruptcy Judge David Jones. Jones presided over Diebold’s Chapter 11 case before resigning in October 2023 after admitting he had a romantic relationship with a Jackson Walker partner.
2. Broader investigation considered
Rodriguez said he was considering recommending a special master to investigate other potentially undisclosed cases in which Jackson Walker appeared before Jones, and ordered the firm to submit a list by October 15. Jackson Walker is also involved in litigation over nearly three dozen bankruptcy matters Jones oversaw, in which the US Trustee is seeking to recover the firm’s fees.
3. Separate fee settlement
Jackson Walker has been negotiating a $15 million settlement with the US Trustee, with a trial currently set for January; the settlement requires court approval. Diebold filed for bankruptcy in June 2023, saying it had reached an agreement to reduce overall debt by $2.1 billion. A hearing in the Diebold case is scheduled for October 22.
