US firms rack up the hours as Enron bonanza goes on

In the first four months of the Enron case alone, 12 US firms have earned more than $64m (£40.8m) in fees and expenses

And many more firms look set to get a piece of the action, with hundreds more parties involved in need of legal advice.
With billing rates of the US firms topping $700 (£447) an hour for some partners, and with the top four firms billing more than $1m (£64,000) a month, the figure for the first year looks set to top $200m (£127.5m).
The biggest biller so far is New York-based Weil Gotshal & Manges (representing Enron), which has billed more than $25m (£15.9m) in the first four months. Partner Brian Rosen devoted 1,095 hours to the case from December 2001 to the end of March this year, which equates to nine billable hours on every single day of that period.
In the UK, the big money-maker would be Linklaters, which is advising administrators PricewaterhouseCoopers. “It's a significant piece of work, which will be going on for many, many years,” commented Herbert Smith insolvency specialist Stephen Gale.
In the latest development, many more firms could get in on the Enron action. As first revealed on last week, the court-approved examiner Neal Batson has applied to the court to subpoena documents from around 400 financial institutions, 45 law firms, 30 former Enron executives and two accounting firms – most of which will require some form of legal advice.
Among the firms listed are Allen & Overy's associate office in Luxembourg Beghin & Feider, Clifford Chance, Freshfields Bruckhaus Deringer, Linklaters and Slaughter and May. Also on the list are four of the top 10 US firms, including Baker & McKenzie, Mayer Brown Rowe & Maw, Shearman & Sterling and Sidley Austin Brown & Wood.
Already Freshfields and Slaughters have instructed Covington & Burling on the matter and Linklaters has instructed Sullivan & Cromwell, although a lot of the more basic work is being done internally by the firms. But just how long the firms will need advice is anybody's guess.
“It really depends on how the examiner plays it,” said a partner at one of the firms. “It may be wrapped up in a matter of months.”
In that case, firms could be looking at a bill as low as a few hundred thousand dollars. However, if the “examiner gets stupid”, the source added, those costs look set to escalate very rapidly – especially if litigation ensues.