Last year, Spokane Bishop Blase J. Cupich sued the law firm which represented Spokane Bishop Wm. Skylstad in the Catholic Bishop of Spokane, Chapter 11 bankruptcy proceedings for violation of certain bankruptcy court conflict of interest rules and for negligence.
There is a bankruptcy court “adversary proceeding” Adv. Proc. No. 14-80001-FPC which will commence on February 17, 2015 at 9:30 a.m. in the third floor courtroom in the United States Post Office at 904 W Riverside Ave., Spokane, Washington. (This is the large courtroom the third floor. It has been renovated and historic and a sight to behold. I hear the acoustics are much improved.)
The purpose of the trial will be to determine:
a. Whether the defendants simultaneously represented both the Diocese and the personal interests of then-Bishop William Skylstad during the Chapter 11 Bankruptcy, and if so, whether such representation constituted an un-waived conflict of interest and/or a relationship requiring disclosure under Bankruptcy Rule2014 and 11 U.S.C. § 327;
b. If there was simultaneous representation of the Diocese and then-Bishop William Skylstad that constituted either a conflict of interest or a relationship that required disclosure to the Court, whether the defendants improperly failed to make that disclosure to the Court and parties-in-interest and violated Bankruptcy Rule2014 and 11 U.S.C. § 327;
c. Whether the Court should set aside the order approving the employment of the defendants as counsel for the Diocese in the chapter 11 Bankruptcy, and the order approving the defendants’ fee applications in that matter;
d. Should the Court determine to set aside the above-referenced orders, whether the Court should order (in the Bankruptcy) the defendants to disgorge all or some portion of fees previously approved and paid to the defendants; and
e. The parties, consistent with the Federal Rules of Evidence shall put on at the time of the hearing scheduled to commence on February 17, 2015, evidence and expert testimony to demonstrate to the Court why or why not the defendants should pay back the fees awarded to it or a portion thereof. It will be up to counsel for the parties to determine what evidence they feel is appropriate to bear on this determination.
The pre-trial conference will be in open court on January 15, 2015 at 9:30 a.m.
Briefs are to be filed on February 4, 2015.