Retention of Professionals Under the Bankruptcy Code: When Compliance Must Precede Representation

When the recent downturn in economic conditions led to an increased number of corporations filing for bankruptcy protection, more non-bankruptcy professionals were engaged to represent debtors in bankruptcy proceedings. When this happened, non-bankruptcy professionals were required to comply with entirely new rules and regulations relating to retention, including conflicts clearance, disclosure requirements, and compensation structure. The following article provides a brief analysis and review of certain ways in which retention under the Bankruptcy Code differs from retention under non-bankruptcy law, answers some frequently asked questions, and highlights some common traps.

This White Paper outlines:

1. The Rules Governing Representation of a Debtor are Different From Those Governing Representation of a Non-Bankrupt Entity
2. The Code Contains a Specific Procedure for Getting Paid
3. There Are Additional Risks Associated With Representing an Entity in Bankruptcy

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