11th Circuit: Motive Not a Factor in Allowing Creditor's Counsel to Recover Fees

ATLANTA - In a case of first impression, the Eleventh Circuit U.S. Court of Appeals has ruled that a creditor's attorney can recover fees and expenses for a "substantial contribution" in a bankruptcy proceeding regardless of whether the creditor has an adverse interest to the debtor. In re: Celotex Corp., Speights & Runyan v. Celotex Corp., et al., No. 98-3747 (11th Cir.).

In a 2-1 decision, the Eleventh Circuit said the bankruptcy judge abused his discretion by applying the wrong legal standard in determining whether a creditor's attorneys can recover fees and expenses, and the U.S. District Court for the …