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Dewey Docket: Laid-Off Staff to Have Their Day in Court

Wall Street Journal—Jennifer Smith

A former Dewey & LeBoeuf LLP document specialist who sued the law firm last year after 450 staffers were told they would be laid off amid the firm’s collapse will be given her day in court, a federal bankruptcy judge ruled this week.

Vittoria Conn had filed a class action in federal court last May alleging the troubled law firm failed to give proper notice to the employees, as required by state and federal Worker Adjustment and Retraining Notification (WARN) laws. Ms. Conn sought relief on behalf of herself and the other staffers for wages they would have earned had the notice been issued within the required time period–60 days under the federal statute, 90 days under New York law and 30 days under California law.

After Dewey sought Chapter 11 protection later that month, Ms. Conn filed an adversary proceeding class action complaint in federal bankruptcy court, which if approved would allow her to present her case before the bankruptcy judge in a lawsuit-like action.

“It can be litigated if necessary, in a way that is conspicuous, so that all the public and class members understand what is happening,” said her lawyer, Jack Raisner, a partner at Outten & Golden LLP.

The firm had argued that Ms. Conn should pursue her claims on a different track, the claims allowance process, which Mr. Raisner described as a potential “procedural quagmire” and “a step backwards” for his client.

On Monday Judge Martin Glenn denied Dewey’s motion to dismiss Ms. Conn’s complaint:

As explained below, the Court concludes that Plaintiff’s Complaint properly asserts causes of action under the WARN Acts and that such claims seek primarily equitable relief that may be asserted in an adversary proceeding in this chapter 11 case. While the Debtor may ultimately prevail on the liquidating fiduciary affirmative defense, or some other defense, the defenses are not established as a matter of law from the four corners of the Complaint.

Therefore, the Motion is DENIED.

Dewey’s lead bankruptcy lawyer, Albert Togut, declined to comment on the matter.

Mr. Raisner said the decision was “a step forward” for Ms. Conn, who has since found employment at another law firm. “This has been a struggle for her, and for a lot of Dewey employees,” he said.

A hearing on the class certification question is scheduled for March 28.