| NEW YORK
NEW YORK Dec 17 A life insurer that purchased
$35 million in notes issued by Dewey & LeBoeuf has sued three of
the defunct law firm's former top executives, accusing them of
concealing the firm's "serious financial problems" to raise
money from potential bondholders.
U.S. units of Britain's Aviva Plc filed the lawsuit
in Iowa federal court on Friday, naming former Dewey chairman
Steven Davis, former executive director Stephen DiCarmine and
former chief financial officer Joel Sanders as defendants.
Dewey & LeBoeuf, which in May became the largest law firm in
U.S. history to file for Chapter 11 bankruptcy, was not named as
a party to the lawsuit.
The lawsuit alleges that the three former executives
violated federal and state securities laws by concealing
critical information about Dewey's financial health in the years
leading up to its failure. They not only hid information from
investors, but also from the public, the firm's auditors and
even its own partners, according to the complaint.
Dewey raised $150 million in a 2010 bond offering in a bid
to refinance its existing debt, according to the lawsuit. The
bond issuance was rare for law firms, and marked a departure
from typical sources of law-firm funding - banks and partner
A lawyer for Davis, Kevin Van Wart, said the complaint has
no merit. Lawyers for the other defendants did not immediately
return calls seeking comment. A spokesman for the Dewey estate
declined to comment.
The plaintiffs are Aviva Life and Annuity Company and a New
York subsidiary of the insurer.
The case is Aviva Life and Annuity Co v. Davis, U.S.
District Court for the Southern District of Iowa, no. 12-603.