Why Dewey Owe More Than $400K to a Former Associate?(And a report on Dewey's day in bankruptcy court.)

What happened at yesterday's bankruptcy court hearing for Dewey & LeBoeuf? And why does the firm owe more than $400,000 in "severance" to a former associate?

Meet Emily Saffitz, a litigation associate at Thompson & Knight who joined the firm from Dewey in April of this year. From the press release announcing her arrival:

“Emily has in-depth experience in commercial litigation and class action matters and is a great addition to our group,” says Joseph S. Pevsner, the Firm’s Trial Department Leader. “Her outstanding skills complement our strong trial practice, and we are pleased she has joined Thompson & Knight.”

Saffitz is resident in the Firm’s New York office and focuses her practice on commercial dispute resolution, with emphasis on derivative and class actions. Her experience includes a broad range of matters involving insurance and financial disputes, litigation risk analysis, regulatory compliance, insolvency proceedings, and contract and tort claims. She received a J.D. from the University of Pennsylvania Law School in 2006 and a B.A. from Emory University in 2003. She joins Thompson & Knight from Dewey & LeBoeuf LLP in New York.

Her time at Dewey must have been… interesting. As noted by the American Lawyer, Saffitz made Dewey’s list of top 20 unsecured creditors. The Dewey estate listed Saffitz as owed $416,667 pursuant to a “severance arrangement.”

Wow — that’s some pretty nice severance, especially for a class of 2006 law school grad. If Emily Saffitz was earning around $230,000 to $250,000 in base salary, the sum of $400,000 represented more than a year’s worth of severance. We’ve heard from other Dewey employees who got severance payments, after leaving the firm before it really hit the rocks, and none of them received such a generous package. (And the original sum owed to Saffitz might have been even higher than $416,667, if she received any payments between her departure from Dewey and the time the firm’s financial troubles grew most acute.)

One of our readers wondered:

I find myself shamefully curious why one of Dewey’s largest unsecured creditors is an individual with a severance agreement. Knowing the horrid things that have happened to women in large law firms in recent years, I hope and pray it was just a normal everyday discrimination claim.

Well, it depends on how you define a “normal everyday discrimination claim.” Would Dewey have offered such generous severance for a garden-variety complaint of a partner making a crude remark or two? Doubtful.

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The detail was picked up by DealBook, which had this to report:

Perhaps the most interesting name on the creditor’s list is Emily L. Saffitz, who is owed $417,000 for a “severance arrangement,” according to the filing. Ms. Saffitz, who left the firm in April to join Thompson & Knight, had complained over how she was treated by a former Dewey partner and told the firm’s management, according to a person with direct knowledge of the matter who spoke anonymously because the details of the agreement were private.

Ms. Saffitz did not return an e-mail or telephone call seeking comment.

We reached out to Saffitz as well, and she did not get back to us. A spokesperson at Sitrick and Company, the crisis communications shop that has been representing Dewey during its downfall, declined to comment on L’Affaire Saffitz.

If you have information about Saffitz’s allegations that you’d be willing to share, please feel free to email us or to text us (646-820-8477; texts only). If you’d like to chat with us by phone about the subject, that’s fine too; just let us know, in your email or text, what number we can reach you at and when would be a good time to call.

UPDATE (6/4/2012): You can learn more about what allegedly transpired, as well as the identity of a partner involved in the situation, over here.

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If you’re interested, flip ahead to the next page to see (1) a copy of Dewey’s bankruptcy petition (your observations on it are welcome), and (2) links to additional news stories about the Dewey bankruptcy.