Attorneys’ fees requested by ATC bankruptcy trustee cut

The federal court has approved only $36,818.55 out of $46,058.55 in new attorneys’ fees that were originally requested by the Advance Textile Corp.’s bankruptcy trustee Robert J. Steffy Sr.

U.S. District Court for the NMI Chief Judge Alex R. Munson disallowed payment for many hours charged by Steffy’s counsel such as conferences between co-counsel and staff, billing preparation, travel expenses, and even meals. The judge also reduced the attorneys’ charges on photocopying papers.

Munson said the court, having considered the arguments of the parties and having reviewed the record, approves Steffy’s application for allowance of attorney’s fees and costs in the amount of $36,818.55 for their services from Nov. 1, 2005 up to Aug. 31, 2006.

Munson ordered Steffy to immediately pay 75 percent of the approved fees to his counsel—attorneys Wayson W. S. Wong in the amount of $22,623.53 ($21,429.38 in attorney’s fees and $1,194.15 in costs) and Sean Frink in the amount of $4,990.38 ($4,530.41 in attorney’s fees and $459.97 in costs).

Munson said as with all interim compensation, the court may review and reconsider the court’s award of interim compensation when approving the final fee application.

Munson disallowed some hours charged by the attorneys’ for conducting conferences between co-counsel and staff.

With respect to billing preparation and fee application preparation, the judge disallowed compensation for 24.7 hours at a rate of $200 per hour.

He also ruled that travel expenses for nine hours at a rate of $150 are not compensable as well as the claimed meals of $133.

Frink and Wong withdrew some expenses incurred for some photocopying papers and time in purchasing new lock and chain for ATC building in Navy Hill.

The ATC bankruptcy case has been dragging on in federal court for more than three years now, resulting in payments of over $200,000 in attorneys’ fees and court costs.

Records show that Steffy requested for another payment for attorneys’ fee in the amount of $46,058.55, but it was opposed by Dr. Terry Dawson, Dr. Wassserman, and Tracy Anderson.

Dr. Dawson, who is based in Alabama, claimed to be a creditor of ATC. He said he invested in the purchase of common stock and made loans to ATC in the form of notes.

Dawson said Trustee’s legal cost eroded the value of the debtor’s estate with nothing to show for its efforts except consistently asking for more money.

The estate, he said, should have been liquidated years ago.

Dr. Wasserman, who claimed to have mortgaged interests in ATC property, also opposed the trustee’s alleged excessive attorneys’ fees and costs.

But Guam-based attorney Wong has defended the payments of over $200,000 in attorneys’ fees and court costs.

Wong, in court pleadings, described the opposition to their request for another $46,058.55 in attorneys’ fees as an “unfounded desperation attack” on them by the people that they have cornered for a scheme that involved transfers in fraud of creditors.

Munson earlier granted a settlement that will enable the bankrupt garment factory ATC to receive a total of $290,000 from an insurance company and former ATC officials.