Mirant Bankruptcy Case
Situation
William Snyder, a CRP Managing Partner, was appointed Examiner in the multi-billion-dollar bankruptcy case of Mirant Corp., an Atlanta-based energy company with annual revenues of nearly $5 billion. Mirant had experienced a series of financial setbacks, and on the eve of its $4.5 billion debt restructuring, Mirant and many of its subsidiaries filed for Chapter 11 protection, launching the largest bankruptcy case ever filed in the Northern District of Texas and one of the largest in U.S. history. The case was extremely complex, with principal players including 83 debtors, along with two official creditor committees, one official equity committee, two ad hoc creditor committees, and thousands of creditors, holding over. Through all this, Mr. Snyder and his team -- CRP Partner Paul Ravaris and Gardere Wynne Sewell attorneys Richard M. Roberson and Michael P. Cooley -- operated with lean staffing and ultimately came in $1.3 million under budget.
Initially, Mr. Snyder was appointed to investigate potential causes of action and take steps to resolve inter-company conflicts. However, as the case progressed, the scope of his duties increased over the next several months to the point where his mandate became one of the broadest ever given to a bankruptcy examiner.CRP’S Approach
The CRP-Gardere team completed all court-directed investigations and opened up the lines of communication, resolved conflicts, and brought order to a chaotic and difficult situation. Among other tasks, they:
- Identified and eliminated a previously undisclosed $110 million liability relating to Mirant’s “Change in Control” agreements
- Spearheaded negotiations that provided the basis for the debtors’ consensual plan of reorganization
- Mediated several key disputes
- Negotiated an overall post-petition employee benefits program
- Improved overall case efficiency and streamlined data flow
Results
Mirant emerged from Chapter 11 in January 2006 and was re-listed to the New York Stock Exchange under the symbol MIR. The efforts of the CRP-Gardere team were instrumental to Mirant’s successful reorganization, the near-100% recovery paid to unsecured creditors and the significant dividend paid to former shareholders.
In light of the tremendous achievements performed $1.3 million under-budget by the CRP-Gardere team, the Examiner and his team made a request to the bankruptcy court for fee enhancement. The Court awarded bonuses for the CRP-Gardere team totaling over $500,000.
In his Memorandum Opinion on Fees, the bankruptcy judge presiding over the Mirant case said, “the Examiner and his counsel have provided outstanding services in these cases … the professionals have done outstanding work and have well-earned their fees.”