WeWork seeks bankruptcy protection in stunning fall for a firm once valued at close to $50 billion

NEW YORK (AP) — WeWork has filed for Chapter 11 bankruptcy protection, marking a stunning fall for the office sharing company once seen as a Wall Street darling that promised to upend the way people went to work around the world.

The New York company said late Monday that it had entered into a restructuring agreement with most of its stakeholders aimed at slashing its debt, while it looks to trim its commercial office lease portfolio.

The agreement is expected to erase about $3 billion of WeWork’s debt, CEO David Tolley told The Associated Press.

WeWork is paying the price for aggressive expansion in its early years. The company went public in October 2021 after its first attempt to do so two years earlier collapsed spectacularly. The debacle led to the ouster of founder and CEO Adam Neumann, whose erratic behavior and exorbitant spending spooked early investors.

“I feel like (WeWork) has been imploding in slow motion,” Nicole Schmidt, an attorney and managing partner at investment banking firm Oberon Securities, said while pointing to Neumann’s actions that lead up to the company’s first IPO failing.

“WeWork as a company may survive, but they’ve got a tremendous amount of baggage,” she

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November 12, 2023 by ATTORNEY

Top Texas Firm Entangled in Bankruptcy Judge’s Ethics Trouble

A Texas law firm tied to a prominent bankruptcy judge’s alleged ethical misconduct is seeking to keep its status as a go-to firm in one of the country’s busiest bankruptcy courts.

The Justice Department’s bankruptcy watchdog has accused Jackson Walker of failing to disclose potential conflicts of interest after a onetime partner at the firm, Elizabeth Freeman, was alleged to be in a romantic relationship with bankruptcy Judge David R. Jones, who regularly oversaw the firm’s cases. The allegations have put Jackson Walker in an unusual position for a firm that’s known in bankruptcy circles for its role as the right hand of corporate restructuring powerhouse Kirkland & Ellis for its Houston-based cases.

The US Trustee late last week challenged at least $13 million in fees the firm earned while representing clients before Jones in the US Bankruptcy Court for the Southern District of Texas.

Jones presided in at least 26 cases where Jackson Walker was awarded compensation and expenses while Freeman worked at the firm and lived with Jones in an intimate relationship, the US Trustee said in court filings. The firm has said it made sure that Freeman wouldn’t work on or bill for any cases Jones was

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November 11, 2023 by ATTORNEY

WeWork’s bankruptcy caps swift downfall for $47 billion standout

Just two years after it went public, the once high-flying real estate business WeWork filed for bankruptcy without ever having figured out how to make flexible workspaces into a profitable enterprise.

It caps a wild ride for a company that began with the idea of re-imagining staid offices as fun places to hang out and grew to a behemoth worth $47 billion at its peak. A botched 2019 initial public offering and erratic behavior by co-founder Adam Neumann started WeWork’s downfall, but the company was also battered by forces outside its control — COVID-19 lockdowns and a slow return to offices that undermined demand.

The company listed $19 billion of liabilities and $15 billion of assets in its Chapter 11 filing in New Jersey on Monday. The petition allows WeWork to continue operating as it works to shore up finances. The company said it reached a restructuring deal with longtime backer SoftBank Group and existing creditors to slash over $3 billion of debt. Most shareholders will be wiped out. It never turned a profit as a public company, reporting net losses that totaled $3 billion.

Bankruptcy will also, critically, allow WeWork to cancel or renegotiate unprofitable leases at more than

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November 9, 2023 by ATTORNEY

WeWork seeks bankruptcy protection in stunning fall for a company once valued close to $50 billion

NEW YORK (AP) — WeWork has filed for Chapter 11 bankruptcy protection, a stunning fall for the office-sharing company that once promised to upend the way people went to work around the world.

The filing comes at a time of incredible disruption in the commercial real estate market. The COVID-19 pandemic led to a spike in vacancies and major markets, from New York to San Francisco, are still struggling.

But it was an aggressive expansion in WeWork’s early years, that led to the bulk of its current troubles. The company went public in October 2021 after an attempt two years earlier collapsed spectacularly. The debacle led to the ouster of founder and CEO Adam Neumann, whose erratic behavior and exorbitant spending spooked early investors.

Despite efforts to turn the company around since Neumann’s departure — including significant cuts to operating costs and rising revenue — WeWork has struggled in a commercial real estate market that has been rocked by the rising cost of borrowing money, as well as a shifting dynamic for millions of office workers now checking into work remotely.

“I feel like (WeWork) has been imploding in slow motion,” said Nicole Schmidt, an attorney and managing

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November 8, 2023 by ATTORNEY

Waco attorney Shank to run again for Waco’s Texas House seat

Waco bankruptcy attorney Erin Shank will announce her candidacy Sunday for the Texas House of Representatives seat Charles “Doc” Anderson will leave at the end of the term.

Shank will make her announcement Sunday on the 40th anniversary of her becoming a lawyer. This will be her second time to run for Texas House District 56 as a Democrat. She lost to Anderson in the last election. He will not seek reelection next year, after ten terms in the position.

Shank said two issues that loom large in her mind as motivators for a second run are a bill proposed in the Legislature’s last regular session that would revoke regulations on the dairy farms up the Bosque River from Waco, and border security.

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“The Constitution makes border security a matter of federal jurisdiction, but I have been talking with state legislators and state senators about laws we can pass to improve things down there,” Shank said in a phone interview.

“We can work on the humanitarian problem and secure the border,” she said. “We can walk and chew gum at the same time. State reps can push the issue forward.”

People who

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November 4, 2023 by ATTORNEY
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