Another law firm files bill in 38 Studios case

PROVIDENCE, R.I.(WPRI) - A law firm assigned to handle some of the legal work in the 38 Studios bankruptcy filing has asked the courts to be reimbursed $28,716 for just over two months of work.

It is the second law firm of three to submit a bill to the courts bringing the total tab $119,911 between the two firms. That tab is expected to rise as work continues and a third firm assigned to the case by the trustee submits a bill.

Delaware firm "Cooch and Taylor" said they devoted 84 hours of work amounting to $27,662 for an average hourly rate of $329. The remainder of the fee is for reimbursement of expenses, according to court documents.

One lawyer in the firm charges $420 an hour, others including paralegals charge less according to detailed accounts of how the firm spent time on the case.

The "interim application for compensation" was filed Friday and must be approved by a judge.

A hearing is set for October 17 at federal bankruptcy court in Delaware.

Administrative costs - including legal fees - are the first to be paid out of whatever assets can be recouped in a bankruptcy case, according to Rhode Island attorney Christopher Lefebvre.

"They get paid with priority in a bankruptcy case," Lefebvre said. "What people might think is expensive in Providence might be considered on sale for Delaware standards."

The bankruptcy court in Delaware handles a lot of filings because many companies incorporate there to take advantage of the state's low taxes.

Whatever the administrative costs are to handle the case will be taken from remaining assets of 38 Studios and its three subsidiaries which filed for Chapter 7 bankruptcy protection in June.

Earlier this month law firm Cozen O'Connor asked to be reimbursed $91,195 for the same time period ending August 31.

In April, 38 Studios stopped paying their employees then had to lay off its nearly 400 workforce after defaulting on a payment to EDC, which lured the company here with a $75 million taxpayer-backed loan. The agency's top official and board members have resigned.

Tim White ( twhite@wpri.com ) is the Target 12 investigative reporter for WPRI 12 and Fox Providence. Follow him on Twitter: @white_tim