A Faegre Drinker finance and restructuring team received a favorable ruling for client SomeraRoad, Inc. where the Third Circuit Court of Appeals upheld sanctions in SomeraRoad's favor against two Florida-based law firms for not disclosing their business relationships with one another, the building's loan broker and one of its creditors.
In the opinion, the panel wrote that I. Mark Rubin and his brother, Guy Rubin, did not disclose to the bankruptcy court that both of their law firms practiced under the same trade name Rubin & Rubin PA when I. Mark Rubin was hired to represent the Little Rock office building.
The bankruptcy court ordered both Rubin & Rubin firms to be disqualified and to return their fees as well as pay $55,000 to the creditors' counsel. The Rubins were also found in contempt for failing to make payments under those orders. Those orders were upheld in October 2021 by Delaware District Court Judge Colm Connolly.
The Third Circuit affirmed the Bankruptcy and District Courts in their entirety. The Third Circuit held that disclosures serve an important purpose for courts and must be reliable.
See the Law360 article for more details on the case.