The U.S. Trustee’s New Chapter 11 Fee Guidelines

Following the culmination of two public comment periods spanning more than a year, the Office of the United States Trustee, a unit of the U.S. Department of Justice (the "DOJ") assigned to oversee bankruptcy cases, issued new final guidelines on June 11 governing the payment of attorneys' fees and expenses in large chapter 11 cases—cases with $50 million or more in assets and $50 million or more in liabilities. The guidelines, which will apply to cases filed on or after November 1, 2013, are intended to "enhance disclosure and transparency in the compensation process and to help ensure that attorneys' fees and expenses are based on market rates," according to a June 11 press release from the DOJ. According to the DOJ, the new guidelines reflect "significant changes that have occurred in the legal industry as well as the increasing complexity of business bankruptcy reorganization cases."