As lay people, we have been trying to understand some of the legal aspects of the Madoff case. For example, on December 15, 2008, U.S. District Court Judge Louis Stanton appointed Irving Picard, a highly experienced bankruptcy attorney, with the Gibbons law firm, as trustee for BMIS.
In that order, the judge named the firm of Baker & Hostetler to serve as Mr. Picard's counsel. Then exactly one week later, on December 22, Mr. Picard became a partner at Baker & Hostetler.
Why, we wondered, would Judge Stanton not simply have appointed Gibbons as the trustee's counsel, given that on the day of his appointment Mr. Picard was presumably employed by that firm?
Seeking an answer, we spoke on the telephone with John J. Gibbons. While Judge Gibbons would not comment on Mr. Picard's departure, he did state that his firm is fully capable of acting as counsel to the bankruptcy trustee and indeed, has significant experience in such matters.
After researching the matter further and discovering that it is not uncommon for a bankruptcy trustee to request that his own law firm be appointed to serve as his counsel, we wondered: did Mr. Picard, if he requested that Judge Stanton name Baker & Hostetler, know on December 15, 2008, that he would be leaving Gibbons to join that firm?
In considering this issue, it should be pointed out that both the trustee and his counsel are entitled to compensation for their efforts. Thus, only days ago, Baker & Hostetler filed a motion with the U.S. Bankruptcy Court for the Southern District of New York requesting that Judge Burton R. Lifland determine their, and Mr. Picard's compensation.
On February 11, we emailed Mr. Picard asking if he had requested that the court appoint Baker & Hostetler as his counsel. That same day we emailed Mr. George Stamboulidis, the managing partner of Baker's New York office asking if he was aware on December 15, that Mr. Picard would leave his position at Gibbons and join Baker. As of today, at 4:00 P.M., we have had no response to either email.
More on this tomorrow.