A recent ruling has placed Houston’s Jackson Walker LLP in hot water, as U.S. Bankruptcy Judge Marvin Isgur has accused the firm of breaching its ethical obligations. This comes in the wake of revelations about a concealed relationship between David Jones, a former bankruptcy judge, and Elizabeth Freeman, a partner at the firm.
In a letter sent to the chief judge of the U.S. District Court for the Southern District of Texas, Judge Isgur referred Jackson Walker for disciplinary proceedings, citing their failure to disclose the romantic involvement, which the firm acknowledged was known to them as early as March 2022. Despite this awareness, Jackson Walker continued to bill $11 million in legal fees for cases overseen by Judge Jones, without disclosing the relationship.
Isgur firmly stated that the law firm had a clear duty to inform the court, emphasizing, “I reject the concept that Jackson Walker had no duty to inform the court because Judge Jones, a judge on the court, obviously knew.”
This controversy escalates as Judge Jones, once the busiest bankruptcy judge in the nation, resigned last October after admitting to cohabiting with Freeman. His tenure included overseeing high-profile cases such as those of JCPenney and Neiman Marcus. In light of these events, the U.S. Trustee has been working to reclaim millions in fees approved by Jones across at least 35 bankruptcy cases filed by Jackson Walker.
Due to the ethical implications, Isgur has recused himself from overseeing related disputes, highlighting the potential conflict of interest in addressing the disciplinary matter while also adjudicating bankruptcy cases tied to the same situation. Some of Isgur’s cases have now been reassigned to other judges within the Southern District of Texas.
The unfolding situation has also drawn attention to an ongoing criminal investigation into Judge Jones, alongside recent sanctions for providing testimony outside the supervision of the court. As this legal drama continues to develop, the implications for Jackson Walker and the broader legal community are yet to be fully realized.
