Stroock Law Firm Settlement With Creditors Has Gone Effective

NEW YORK, Jan. 3, 2025 /PRNewswire/ -- Stroock & Stroock & Lavan LLP ("Stroock") is pleased to advise that it has reached settlements with all of its major creditors which will allow for the consensual and orderly completion of its out of court winddown and the distribution of its assets.

Stroock entered into dissolution effective November 17, 2023, after several large partner groups departed for other firms. The firm ceased the practice of law shortly thereafter.  The Executive Committee named Gary Polkowitz, a Senior Managing Director of Teneo, the global CEO advisory firm, as Liquidation Manager responsible for overseeing the firm's winddown.  Mr. Polkowitz and his team, along with his outside professionals, have spent the past year negotiating settlements with secured and unsecured creditors, marshaling remaining assets, closing firm offices, returning escrowed funds and performing such other activities as required in a law firm liquidation. 

Under the terms of the settlement and distribution plan, the Liquidation Manager will distribute the firm's remaining assets, net of a reserve for future winddown costs, pro rata to its senior unsecured creditors based on the amount of their agreed claims. Distributions will be made over time and are currently estimated to be 60% of the allowed claim amounts (actual recoveries may be higher or lower). Creditors with relatively small claims will be given the option of accepting a one-time payment of 40% of their allowed claim. Under the terms of the settlement, creditors have agreed to release the firm and its former partners from any further liability. The settlement was conditioned on acceptance by 80% of the firm's creditors by dollar amount.

Said Mr. Polkowitz: "Based upon my experience with other law firm liquidations, the estimated recoveries to Stroock's creditors far exceed those in a typical law firm liquidation. Because of this, and the transparent manner in which the winddown has been conducted, more than 90% of Stroock's creditors agreed to the settlement through the end of December 2024. The high recoveries were made possible because of excellent work by Stroock's dedicated winddown team and because the firm's former partners took their obligations to creditors and the firm seriously having worked diligently to assist in collecting the firm's accounts receivable."  

Mr. Polkowitz has been assisted in the winddown by outside counsel at Togut, Segal & Segal LLP and by David Pauker, a well-known restructuring expert, who acted as Special Advisor to the firm. 

Contact:

Gary Polkowitz
Liquidation Manager
[email protected]

SOURCE Stroock & Stroock & Lavan LLP