Where Should Lehman Have Filed?

As many Credit Slips readers know, I have spent a good bit of my academic career writing about professionals in chapter 11. Thus I was drawn to the Economist's recent article about the "bonanza" of professional fees in Lehman.

The article largely puts the blame for inflated chapter 11 costs on forum shopping, complete with the requisite quote from Lynn LoPucki. Problem is, there was no forum shopping in Lehman.

The article also argues that courts should be ordered to use fee examiners in all cases -- without mention of the fact that neither Lynn nor I have found any cost reduction from fee examiners. As I wrote in the ABI fee study, fee examiners primarily add the cost of the examiner to the case. They don't reduce costs.