Thursday, August 17, 2023

After 81 Years, Major Phoenix Law Firm Suddenly Shutting Its Doors, Bank Asks Court To Appoint A Receiver After Startling Loan (ARIZONA'S LAW SHORTS)

5:45pm: "After 81 Years, Major Phoenix Law Firm Suddenly Shutting Its Doors, Bank Asks Court To Appoint A Receiver After Startling Loan"

Jennings Strouss is swiftly shutting its doors, after 81 years as one of the most successful law firms in Phoenix. According to court filings from PNC Bank, most of its attorneys have already jumped to other firms, "tak(ing) their book of business with them."

PNC is asking Superior Court Judge Christopher Coury to immediately appoint a receiver to wind down the firm and retain as much of the assets as possible. 

Surprisingly, Jennings Strouss obtained a $4M line of credit from PNC less than four months ago. (They have drawn $3.4M of it, according to the Complaint.) PNC tells the court that the firm's actions in not advising the bank of all of the departing attorneys constitutes a default warranting the appointment of the receiver. (In other words, there is not yet a default on the payments.)

"Substantially all of the attorneys and other employees of Borrower have taken jobs at other law firms and taken their book of business with them, thereby transferring substantially of the assets and business of Borrower to these other firms. McKernan Dec. ¶ 18. PNC believes that Borrower is shutting down its operations is because it is insolvent, and that Borrower will not be making any further payments on the Loan."

Jennings Strouss was one of the 10 largest law firms in Phoenix, and had expanded with offices in Tucson, Washington, DC, Austin, TX and elsewhere. It was headquartered in the Cityscape towers in downtown Phoenix, and the landlord has been named as a co-defendant.

An Order to Show Cause hearing is set for this coming Tuesday. Arizona's Law has reached out to the parties for comment and will update as warranted. 

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4:20pm: Drunk driver convicted for second degree murder and sentenced to 12 years in prison 

 
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2:15pm: "NEW: AZ's Mark Finchem and Wendy Rogers Will NOT Be Permitted To Testify In (Indicted) John Eastman's Bar Disciplinary Proceeding"

Indicted attorney John Eastman will not have Arizona's Mark Finchem and Wendy Rogers testifying on his behalf in his California State Bar proceeding, after all. The judge's decision (below) was published early today, after she decided not to take an indefinite pause after Eastman's RICO indictment with Donald Trump and many others for interfering with the electoral process.

Eastman listed Finchem, Rogers and other witnesses too late, the Bar claimed. After failed efforts to reach an agreement on limiting the number of late-disclosed witnesses, the judge ruled against nearly all of them. (Kari Lake attorney Kurt Olsen will be permitted to testify as to very limited matters, because he had been mentioned as a limited witness.)

Eastman had wanted to have Finchem and Rogers testify about their beliefs that Trump had defeated Biden in Arizona in 2020. (That would apparently help convince the judge that Eastman's legal plans for January 6 were legitimate and did not violate his ethical responsibilities.)

Arizona Governor Katie Hobbs' General Counsel Bo Dul will be called as a witness for the California Bar. She was the state's Elections Director for the 2020 elections. Her testimony will likely take place next month.

 This article was reported by AZ Law founder Paul Weich. 

"AZ Law" includes articles, commentaries and updates about opinions from the Arizona Supreme Court, U.S. Supreme Court, as well as trial and appellate courts, etc. AZ Law is founded by Phoenix attorney Paul Weich, and joins Arizona's Politics on the internet. 

AZ Law airs on non-profit Sun Sounds of Arizona, a statewide reading service that provides audio access to printed material for people who cannot hold or read print material due to a disability. If you know someone who could benefit from this 24/7 service, please let them know about member-supported Sun Sounds. And, YOU can donate or listen here. 

Previous episodes of AZ Law can be streamed or downloaded here, or wherever you get your podcasts.


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