Twitter confirmed on Tuesday that Tesla CEO Elon Musk has sent a letter that he¡¯ll go through with the deal of purchasing the microblogging platform for $44 billion.?Twitter shares zoomed 22% after the announcement.
But not everyone is likely to turn out as a winner in Elon Musk¡¯s decision to go through with the?$44 billion?Twitter?deal.?Consider the?lawyers?who were preparing to battle it out at the upcoming trial over whether the world¡¯s richest person, Musk?could walk away from the buyout. These lawyers had the chance to earn millions of dollars doing that.
As per the Bloomberg report, more than 70 lawyers were admitted to Delaware Chancery Court to represent various parties in the case, about 30 for?Twitter, most of them from Wachtell Lipton Rosen & Katz, the most profitable firm in the country, and about?20 for Musk?from firms including Quinn Emanuel Urquhart & Sullivan LLP and Skadden Arps Slate Meagher & Flom LLP.??
¡°With all the lawyers in the case and the potential for other litigation to spin out of this, such as investor suits, I could see the total legal fees reaching $1 billion,¡±?said John Coffee, a Columbia University law professor who teaches about mergers and acquisitions disputes.A few other cases have reached or exceeded the billion-dollar mark in fees, he reportedly said in an interview before Tesla CEO Elon Musk revived his bid to buy Twitter, so the amount wouldn¡¯t be historic but still significant.
"Even without a trial, lawyers have already racked up fees by sending out dozens of subpoenas to witnesses that might have been called to the stand by one side or the other. They ought to give Elon Musk some kind of award for being the man who has done the most recently to ensure the economic health of the legal profession," he mentioned, as per the report.
In the $44 billion Twitter deal deadlock, both Musk¡¯s main Delaware lawyers from Skadden Arps and?Twitter¡¯s lead firm, Wachtell, had to reportedly hire so-called conflict counsel to put out subpoenas to parties they¡¯d represented in the past, according to court filings. For the Musk side, conflict counsel was the law firm of Chipman Brown Cicero & Cole LLP.?
For Twitter, it was the Delaware office of Ballard Spahr LLP and the local law firm of Kobre & Kim LLP.
The massive amount of pre-trial fact-finding disputes in a case like this $44 billion?Musk-Twitter showdown keeps the law firms¡¯ cash registers ringing, said Chuck Durante, a partner in Wilmington¡¯s Connolly Gallagher LLP and the current head of the Delaware State Bar Association.
¡°It¡¯s pretty difficult to quantify how much in legal fees each side will be spending, but it¡¯s safe to say it¡¯s going to be a good year for all the law firms involved in the case,¡± Durante said in an interview, as per Bloomberg report.
Also Read:?Twitter?Board Recommends $44 Billion Sale To?Elon Musk
In a trial, legal fees for both sides could have reached the low-to-mid eight figures, as associates can work 14 to 16 hours a day on such cases, Peter Ladig, a Delaware lawyer who mostly handles Chancery Court cases, said in July 2022.?
A recent bill for services that got some public notice is reportedly former US Solicitor General Neal Katyal¡¯s nearly?$2,500-per-hour fee for representing?Johnson & Johnson?in an appellate argument?over the controversial Chapter 11 filing of one of its units to corral its talc-cancer liability.
In a 2019 bankruptcy?case, Wachtell's partners billed $1,100 to $1,500 an hour, while their associates charged $650 to $900. Those figures have likely grown in more recent years, but law firms don¡¯t regularly report hourly prices, the report mentioned.
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