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TOGUT, SEGAL & SEGAL LLP One Penn Plaza Suite 3335 New York, New York 10119 (212) 594-5000 Albert Togut Scott E. Ratner Scott A. Griffin Proposed Counsel to the Debtor and Debtor in Possession

UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK ---------------------------------------------------------------X : In re: : : DEWEY & LEBOEUF LLP, : : Debtor. : : ---------------------------------------------------------------X

Chapter 11 Case No. 12-12321 (MG)

DEBTORS OMNIBUS MOTION FOR AN ORDER PURSUANT TO 11 U.S.C. 365(a) AND 554(a), FED. R. BANKR. P. 6006 AND 6007, AND LOCAL BANKRUPTCY RULES 6006-1(a) AND 6007-1(a) AUTHORIZING THE DEBTOR TO (I) REJECT CERTAIN UNEXPIRED LEASES AND SUBLEASES OF NONRESIDENTIAL REAL PROPERTY, AND (II) ABANDON CERTAIN RELATED PERSONAL PROPERTY NUNC PRO TUNC TO THE PETITION DATE Parties Receiving This Motion Should Locate Their Names and Leases on Exhibit 1 Attached Hereto. The debtor and debtor in possession in the above-captioned case (the Debtor or DL), hereby moves this Court (the Motion) for entry of an order (the Order), pursuant to sections 365(a) and 554(a) of title 11 of the United States Code (the Bankruptcy Code), Rules 6006 and 6007 of the Federal Rules of Bankruptcy Procedure (the Bankruptcy Rules) and Rules 6006-1(a) and 6007-1(a) of the Local Bankruptcy Rules for the Southern District of New York (the Local Bankruptcy

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Rules), authorizing the Debtor to (i) reject certain unexpired leases1 and subleases of non-residential real property for closed offices as identified on Exhibit 1 annexed hereto (collectively, the Leases)2, and (ii) abandon certain personal property (the Non-Essential Owned Property) located in the Debtors former offices where the Debtor is not conducting the post-petition wind down of its business, effective nunc pro

tunc to May 28, 2012 (the Petition Date).3 In support of its Motion, the Debtor submits
the accompanying Declaration of Jonathan A. Mitchell annexed hereto as Exhibit 2. In further support of the Motion, the Debtor respectfully represents: JURISDICTION AND STATUTORY PREDICATES 1. The Court has jurisdiction to consider this Motion under 28 U.S.C.

157 and 1334. This is a core proceeding under 28 U.S.C. 157(b). Venue is proper under 28 U.S.C. 1408 and 1409. 2. The statutory predicates for the relief requested herein are sections

365 and 554 of the Bankruptcy Code, Bankruptcy Rules 6006 and 6007 and Local Bankruptcy Rules 6006-1(a) and 6007-1(a). BACKGROUND The Chapter 11 Case 3. On the Petition Date, the Debtor filed a voluntary petition in this

Court for relief under Chapter 11 of the Bankruptcy Code. The factual background regarding the Debtor, including its operations, its capital and debt structure, and the

For purposes of this Motion, the term leases shall also encompass certain executory contracts providing the Debtor with rights to use non-residential real property in connection with the operation of its former business. Each Lease listed on Exhibit 1 includes all modifications, amendments, addenda, exhibits and supplements that affect such Leases. The Debtor seeks to reject the Leases on Exhibit 1 relating to its Brussels, Belgium offices, effective as of July 1, 2012, and London, United Kingdom offices, effective as of June 24, 2012.

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events leading to the filing of this bankruptcy case, is set forth in detail in the Declaration of Jonathan A. Mitchell submitted in accordance with Local Bankruptcy Rule 1007-2 in support of the Debtors Chapter 11 petition filed on the Petition Date [Docket No. 2], which is deemed fully incorporated herein by reference. 4. On May 31, 2012, the United States Trustee for the Southern District

of New York appointed the Official Committee of Unsecured Creditors (the Creditors Committee) and the Official Committee of Former Partners (the Former Partners Committee). 5. The Debtor continues to manage and operate its business as a

debtor in possession under Bankruptcy Code sections 1107 and 1108. The Leases and Closed Offices 6. Prior to the Petition Date, the Debtor was party to each of the

Leases in the capacity of lessee, sublessee or sublessor. Specifically, each of the Leases relate to certain office space formerly used in conjunction with the Debtors operations as a global law firm (the Closed Offices). With the exception of a sublease of space in the Debtors former New York City offices, the Debtor no longer has personnel, operations, or property that it desires to retain in the Closed Offices and, as a result, no longer has a continuing use for the Leases associated with those offices. RELIEF REQUESTED 7. By this Motion, the Debtor seeks entry of the Order, substantially in

the form annexed hereto as Exhibit 3, pursuant to sections 365(a) and 554(a) of the Bankruptcy Code, authorizing the Debtor to reject the Leases and to abandon the NonEssential Owned Property, nunc pro tunc to the Petition Date. As noted above, the Debtor no longer has personnel, operations, or property it seeks to retain in any of the Closed Offices and, prior to and/or since the Petition Date, has been in contact with the 3

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various Lease counterparties regarding, inter alia, its intention to vacate the Closed Offices and reject the related Leases where such offices were not terminated prior to the Petition Date. The Debtor also has been in discussions with counterparties to its unexpired personal property leases regarding the retrieval of certain of their property (the Non-Essential Leased Property) in the Closed Offices.4 BASIS FOR RELIEF Rejection of the Leases Is a Proper Exercise of the Debtors Business Judgment, as the Leases Do Not Provide a Benefit to the Estate 8. Section 365(a) of the Bankruptcy Code provides that a debtor in

possession, subject to the courts approval, may assume or reject any executory contract or unexpired lease of the debtor. 11 U.S.C. 365(a). The United States Court of Appeals for the Second Circuit has stated that [t]he purpose behind allowing the assumption or rejection of executory contracts is to permit the trustee or debtor-inpossession to use valuable property of the estate and to renounce title to and abandon burdensome property. See Orion Pictures Corp. v. Showtime Networks, Inc. (In re Orion

Pictures Corp.), 4 F.3d 1095, 1098 (2d Cir. 1993) (quoting 2 Collier on Bankruptcy
365.01[1] (15th ed. 1993)); Med. Malpractice Ins. Assn v. Hirsch (In re Lavigne), 114 F.3d 379, 386 (2d Cir. 1997) (same). 9. A debtors determination to reject an executory contract is

governed by the business judgment standard. See Orion Pictures, 4 F.3d at 1098-99 (2d Cir. 1993) (stating that a debtors decision to reject an executory contract is governed by the business judgment standard and can only be overturned if the decision was the

In connection with the Non-Essential Leased Property, the Debtor has stipulated, or is in the process of negotiating stipulations, with certain counterparties regarding, among other things, the retrieval of such property. The Debtor intends to assist in coordinating the retrieval efforts among the lessors, and sublessors (as applicable) and the Non-Essential Leased Property counterparties.

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product of bad faith, whim, or caprice); see also Nostas Associates v. Costich (In re Klein

Sleep Products, Inc.), 78 F.3d 18, 25 (2d Cir. 1996); In re Balco Equities Ltd, Inc., 323 B.R.
85, 99 (Bankr. S.D.N.Y. 2005) (CGM) (In determining whether the debtor has employed reasonable business discretion, the court for the most part must only determine that the rejection will likely benefit the estate.). Rejection of an unexpired lease or executory contract is appropriate where, in the debtors business judgment, such rejection would benefit the estate. See Orion Pictures, 4 F.3d at 1098-99; In re Stable Mews Assoc., Inc., 41 B.R. 594, 596 (Bankr. S.D.N.Y. 1984) (HCB) (The business judgment test provides considerably more flexibility to a [debtor]. It requires only that the [debtor] demonstrate that rejection of the [contract] will benefit the estate.); In re Riodizio, Inc., 204 B.R. 417, 424 (Bankr. S.D.N.Y. 1997) (SMB) (debtor must demonstrate whether assumption or rejection confers a net benefit on the estate). 10. Upon finding that the Debtor exercised its sound business

judgment in determining that rejection of the Leases is in the best interests of the Debtor and all stakeholders, this Court should approve the rejection pursuant to section 365(a) of the Bankruptcy Code. See, e.g., In re Bradlees Stores, Inc., 194 B.R. 555, 558 n.1 (Bankr. S.D.N.Y. 1996) (BRL); see also NLRB v. Bildisco & Bildisco, 465 U.S. 513, 523 (1984) (finding that if a debtor reasonably exercised its business judgment, a court should approve the assumption or rejection of an executory contract or unexpired lease). 11. The Debtor has ample justification to reject the Leases immediately.

As noted above, prior to the Petition Date, the Debtor determined that the Leases would not be necessary in the wind down of its operations. Specifically, the Debtor decided to (a) agree to, or not contest, the pre-petition termination of certain of the Leases, as proposed by a number of the lessors, (b) vacate certain of the Closed Offices, or (c) seek rejection of the Leases in order to reduce costs and maximize value to creditors of the 5

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estate. In all cases, the Debtor was in contact with the counterparties to the Leases prior to the Petition Date, or shortly thereafter, regarding its intention to turn over the Closed Offices and reject the related Lease.5 12. Moreover, the Debtor believes that the equities in this case support

rejection of each of the Leases effective as of the Petition Date. Indeed, courts in this district and others have routinely authorized rejection retroactive to a date prior to entry of the order authorizing such rejection where the balance of equities favor doing so. See, e.g., In re AMR Corporation, No. 11-15463 (Bankr. S.D.N.Y. Dec. 22, 2011) (SHL) (Docket No. 435) (order authorizing retroactive rejection of unexpired leases and abandonment of related personal property); BP Energy Co. v. Bethlehem Steel Corp., 2002 WL 31548723, at *3 (S.D.N.Y. Nov. 15, 2002) (NBR) (finding that retroactive rejection is valid when the balance of equities favor such treatment); In re Jamesway Corp., 179 B.R. 33, 36 (S.D.N.Y. 1995) (PKL) (stating that section 365 does not include restrictions on the manner in which the court can approve rejection). 13. In considering whether to approve retroactive rejection, courts

examine a number of factors, including the costs that a delayed rejection date would otherwise impose on a debtor. See, e.g., In re Jamesway Corp., 179 B.R. at 33-39. Courts also consider whether the debtor has provided sufficient notice of its intent to reject an unexpired lease of real property. See, e.g., Adelphia Bus. Solutions, Inc. v. Abnos, 482 F.3d 602, 607-09 (2d Cir. 2007); In re The Reader's Digest Ass'n, Inc., No. 09-23529 (Bankr. S.D.N.Y Sept. 17, 2009) (RDD).

With respect to the subleases, the Debtor is seeking to reject both the primary leases and the subleases and believes that the lessors, sublessors and sublesses (as applicable) will have ample opportunity to reach an appropriate accommodation.

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14.

Here, the requested relief will eliminate the Debtors incurrence of

significant post-petition payment obligations under the Leases relating to the Closed Offices Leases which are now burdensome and provide no real benefit to the Debtors estate. The counterparties to the Leases will not be prejudiced by rejection as of the Petition Date. Significantly, as noted above, the Debtor was willing to permit the prepetition termination of the Leases, had vacated certain of the Leased Property on, or near, the Petition Date, and/or informed the relevant party of its intent to reject the applicable Lease. 15. Simply put, because the Leases are not necessary for the wind

down of the Debtors business, they offer no benefit to the estate. Based upon the foregoing, the Debtors decision to reject the Leases constitutes a sound exercise of business judgment, and warrants the rejection relief requested herein. 16. In conjunction with the rejections contemplated by this Motion, the

Debtor proposes that counterparties to the Leases be required to timely file a claim for damages, if any, as a result of the rejection (each Rejection Claims) by the later of: (i) the general bar date to be established in this case; or (ii) within 30-days of notice of entry of the Order. The Debtor reserves its right to challenge such Rejection Claims on any basis. Abandonment of the Non-Essential Owned Property Is Warranted 17. Additionally, the Debtor seeks authority to abandon the Non-

Essential Owned Property located within the Closed Offices. Section 554 of the Bankruptcy Code provides, in pertinent part, that [a]fter notice and a hearing, the [debtor-in-possession] may abandon any property of the estate that is burdensome to the estate or that is of inconsequential value and benefit to the estate. 11 U.S.C. 554(a). 7

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18.

As noted herein, the only remaining items in the Closed Offices are

Non-Essential Leased Property, Non-Essential Owned Property, and other owned personal property in the form of artwork (the Artwork).6 As further noted above, the Debtor has reached, or is in the process of reaching, stipulations with the counterparties to leases for the Non-Essential Leased Property to retrieve such property. Accordingly, abandonment of the Non-Essential Owned Property would be the final step in allowing the Debtor to completely vacate the Closed Offices. 19. Significantly, other than pieces of Artwork in certain offices

specified herein (which the Debtor intends to retrieve, to the extent it has not), the NonEssential Owned Property is of de minimis value and would not provide a benefit to the Debtors estate if retained. Indeed, the Debtor believes that the costs and fees associated with moving and/or selling the property would easily exceed its current value. Thus, the Debtor requests that the Court approve its abandonment of the NonEssential Owned Property, as of the Petition Date. The Debtor proposes to abandon the Non-Essential Owned Property in the Closed Offices where it is currently located. The Debtor Is in Compliance with Bankruptcy Rules 6006 and 6007 and Local Bankruptcy Rules 6006-1(a) and 6007-1(a) 20. Pursuant to Bankruptcy Rule 6006(f), a debtor may join requests for

authority to reject multiple executory contracts or unexpired leases in one motion. See. Fed. R. Bankr. 6006(f). Specifically, Bankruptcy Rule 6006(f) requires that a motion to reject multiple executory contracts or unexpired leases: a. state in a conspicuous place that parties receiving the omnibus motion should locate their names and their contracts or leases listed in the motion;

The relief requested in the Motion is not intended to apply to the Artwork located in the Debtors former Houston, Texas offices, or Los Angeles, California offices. To the extent that the Debtor has not retrieved the Artwork from those offices, it intends to do so as soon as reasonably practicable.

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b. c.

list parties alphabetically and identify the corresponding contract or lease; be numbered consecutively with other omnibus motions to assume, assign, or reject executory contracts or unexpired leases; and be limited to no more than 100 executory contracts or unexpired leases.

d.

Fed. R. Bankr. P. 6006(f). Additionally, Bankruptcy Rule 6006(a), in conjunction with Local Rule 6006-1(a), specifies that a debtor must provide at least 14 days of notice to parties of the motion to reject prior to the hearing. See Bankruptcy Rule 6006(a); Local Bankruptcy Rule 6006-1(a). 21. Bankruptcy Rule 6007(a) governs the notice requirements to

abandon property, providing parties with 14 days notice regarding the proposed abandonment. Fed. R. Bankr. P. 6007(a). Local Rule 6007-1(a) requires that notice of the Debtors intent to abandon also describe the property to be abandoned or disposed of, state concisely the reason for the proposed abandonment . . . and in the case of abandonment, identify the entity to whom the property is to be abandoned. Local Rule 6007-1(a). 22. The Motion satisfies each of the aforementioned notice

requirements for rejection of the Leases and abandonment of the Non-Essential Owned Property. NOTICE 23. Notice of this Motion has been provided by either facsimile,

electronic transmission, overnight delivery, or by first-class priority mail to: (i) each counterparty to the Leases; (ii) the United States Trustee for the Southern District of New York Attn: Brian Masumoto, Esq.; (iii) Brown Rudnick LLP, 7 Times Square, New York, New York 10036, Attn: Edward S. Weisfelner, Esq., as counsel to the Creditors 9

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Committee; (iv) Kasowitz Benson Torres & Friedman LLP, 1633 Broadway, New York, New York 10019, Attn: David M. Friedman, Esq., as counsel to the Former Partners Committee; (v) Kramer Levin Naftalis & Frankel LLP, 1177 Avenue of Americas, New York, New York 10036, Attn: Kenneth Eckstein, Esq. and Robert Schmidt, Esq., as counsel to the Administrative Agent and Collateral Agent; (vi) Bingham McCutchen LLP, 399 Park Avenue, New York, New York 10022, Attn: Michael J. Reilly, Esq. and Ronald J. Silverman, Esq., as counsel to the noteholders; (vii) the Office of the United States Attorney for the Southern District of New York; and (viii) any parties required to be served under any applicable Bankruptcy Rule or Local Rule. The Debtor submits that, under the circumstances, no other or further notice is necessary. NO PRIOR REQUEST 24. No prior request for the relief requested herein has been made to

this or any other Court.

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CONCLUSION WHEREFORE, the Debtor respectfully requests this Court enter the Order requested herein and such other and further relief as may be just and proper. Dated: New York, New York June 20, 2012 DEWEY & LEBOEUF LLP By Its Proposed Counsel TOGUT, SEGAL & SEGAL LLP By: /s/ Scott E. Ratner ALBERT TOGUT SCOTT E. RATNER Members of the Firm One Penn Plaza, Suite 3335 New York, New York 10119 (212) 594-5000

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