OURT FOR THE
In Re: Ethanex Energy, Inc.
Case No. 08-20645-7 RDB T
OMPENSATION AND REIMBURSEMENT OF
5.Further investigation revealed that these claims for damages arose from thesecurities fraud, embezzlement, and other criminal acts and omissions of Louis W. Zehil, who atthe time was a licensed attorney representing and advising the Debtor in connection with theDebtor’s attempts to raise equity capital to invest into the acquisition and construction of ethanolproduction facilities in the Midwest. At the time he committed his criminal acts, Zehil was apartner with the law firm of McGuire Woods, L.L.P.6.On July 31, 2008, the Court entered an order approving the Trustee’s employmentof John M. Edgar and the Edgar law Firm, LLC (“Edgar”) as special counsel to assist the Trusteein the prosecution of a claim on behalf of the estate against Louis W. Zehil and McGuire Woods,LLP.7.At the Trustee’s request, Edgar investigated the facts and circumstances of Zehil’sactions, and on December 17, 2008, Edgar filed an civil action in the United States District Courtfor the District of Kansas, styled
Rajala, as Bankruptcy Trustee for Ethanex Energy, Inc., v.McGuireWoods, LLP,
Case No. 2:08-cv-2638 (the “Kansas Action”). The Kansas Action iscurrently scheduled for a six week trial in the Kansas City, Kansas Division of the District of Kansas, starting on May 9, 2013.8. In the Kansas Action, the Trustee seeks unliquidated damages againstMcGuireWoods, LLP, for (among other things) causing the failure of the Debtor’s businessoperation, for the loss of the capital that had been invested in the Debtor, and for the loss of the
Case 08-20645 Doc# 177 Filed 03/08/13 Page 2 of 21