Hearing Date and Time: March 22, 2016, at 10:00 a.m ... · detailed breakdown of the disbursements incurred, and contemporaneously maintained time entries for each individual in increments

Hearing Date and Time: March 22, 2016, at 10:00 a.m.

Objection Deadline: March 15, 2016

Kevin J. Nash

Evan M. Lazerowitz

Goldberg Weprin Finkel Goldstein LLP

1501 Broadway, 22nd Floor

New York, New York 10036

Telephone: (212) 221-5700

Facsimile: (212) 335-4501 Counsel for the Debtor

UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF NEW YORK

In re:

Chapter 11

Joyce Leslie, Inc., Case No. 16- 22035 (RDD)

Debtor.

DEBTOR’S MOTION TO ESTABLISH

PROCEDURES FOR INTERIM COMPENSATION AND

REIMBURSEMENT OF EXPENSES OF PROFESSIONALS

Joyce Leslie, Inc. (the “Debtor”), hereby submits this motion (the “Motion”) for an order

establishing procedures for interim compensation and reimbursement of expenses of

professionals pursuant to 11 U.S.C. §§ 105(a) and 331, Rule 2016 of the Federal Rules of

Bankruptcy Procedure, Rule 2016-1 of the Local Rules of the United States Bankruptcy Court

for the Southern District of New York, and General Order M-447. In support of the Motion, the

Debtor respectfully represents as follows:

BACKGROUND

On January 9, 2016 (the “Petition Date”), the Debtor commenced its Chapter 11 1.

case (the “Chapter 11 Case”) by filing a voluntary petition for relief under Chapter 11 of the

Bankruptcy Code. The Debtor continues to manage and operate its business as a debtor-in-

possession pursuant to sections 1107 and 1108 of the Bankruptcy Code.

16-22035-rdd Doc 200 Filed 03/07/16 Entered 03/07/16 16:06:38 Main Document Pg 1 of 8

2

An official committee of unsecured creditors was appointed in this Chapter 11 2.

case on January 22, 2016 [Dkt. No. 70].

The factual background regarding the Debtor, including its business operations, 3.

capital and debt structure, and the events leading up to the filing of this Chapter 11 case, are set

forth in detail in the Declaration of Lee Diercks Pursuant to Local Bankruptcy Rule 1007-2

and in Support of Debtor’s First Day Motions [Dkt. No. 1] and accompanying bankruptcy

petition and schedules.

The Debtor has recently completed liquidation sales of its remaining store 4.

inventory pursuant to agency agreement with Gordon Brothers approved by order dated

February 2, 2016 [Dkt. No. 121]. Following the liquidations, the Debtor sold a total of 25

leases pursuant to various orders, primarily to Rainbow Northeast Leasing, Inc. [Dkt. Nos. 172,

182, 183, and 190].

RELIEF REQUESTED

This Chapter 11 case has been pending for approximately 60 days. The Debtor 5.

seeks to establish the procedures described below for the allowance of compensation and

reimbursement of expenses for attorneys and other professionals whose retentions have been

approved by the Court pursuant to sections 327 and 1103 of the Bankruptcy Code (collectively,

the “Retained Professionals”).

The Debtor seeks to establish the following compensation and reimbursement 6.

procedures with respect to the Retained Professionals (the “Compensation Procedures”).

(a) By the twentieth (20th) day of each month1

following the month for which compensation is sought or

as soon as practicable thereafter, each Retained

1 The Monthly Fee Statements for the periods beginning on the Petition Date and ending on February 29,

2016, shall be due 10 days after entry of this Order. All subsequent Monthly Fee Statements shall be due in

accordance with the Compensation Procedures


3

Professional seeking compensation pursuant to this Order

will file with the Court a monthly fee statement (a

“Monthly Fee Statement”) and serve it by hand or

overnight delivery on the following parties (collectively,

the “Notice Parties”): (a) counsel to the Debtor, Goldberg

Weprin Finkel Goldstein LLP, 1501 Broadway, 22nd Floor,

New York, New York 10036, Attn: Kevin J. Nash; (b)

counsel for the Official Committee of Unsecured Creditors,

Cooley LLP, 1114 Avenue of the Americas, New York,

New York 10036, Attn: Jay R. Indyke and Seth Van

Aalten; and (c) the U.S. Trustee, U.S. Federal Office

Building, 201 Varick Street, Suite 1006, New York, New

York 10014, Attn: Susan Golden.

A courtesy copy need not be delivered to Chambers since

any order on the Motion is not intended to alter the fee

application requirements outlined in sections 330 and 331

of the Bankruptcy Code and since Retained Professionals

are still required to serve and file interim and final

applications for approval of fees and expenses in

accordance with the relevant provisions of the Bankruptcy

Code, the Bankruptcy Rules and the Local Rules;

(b) For those Retained Professionals who bill based on

time, each Monthly Fee Statement must contain a list of the

individuals and their respective titles (e.g., attorney,

accountant, or paralegal) who provided services during the

statement period, their respective billing rates, the

aggregate hours spent by each individual, a reasonably

detailed breakdown of the disbursements incurred, and

contemporaneously maintained time entries for each

individual in increments of tenths (1/10) of an hour, unless

the Court orders otherwise with respect to an individual

firm’s retention. No Retained Professional should seek

reimbursement of an expense which would otherwise not

be allowed pursuant to the Amended Guidelines for Fees

and Disbursements for Professionals in Southern District of

New York Bankruptcy Cases (“General Order M-447”);

(c) Each person receiving a statement will have the

later of (i) fourteen (14) days after its receipt of the

statement or (ii) the thirty-fifth (35) day following the end

of the month for which compensation is sought (the


4

“Objection Deadline”) to review it and, in the event that he

or she has an objection to the compensation or

reimbursement sought in a particular statement, serve upon

the Retained Professional whose statement is objected to,

and the Notice Parties, a written “Notice of Objection to

Fee Statement” setting forth the nature of the objection and

the amount of fees or expenses at issue;

(d) At the expiration of the Objection Deadline, the

Debtor shall promptly pay 80% of the undisputed fees and

100% of the undisputed expenses identified in each

monthly statement to which no objection has been served in

accordance with paragraph (c);

(e) If the Debtor receives an objection to a particular

fee statement, it shall withhold payment on that portion of

the fee statement to which the objection is directed and

promptly pay the remainder of the fees and disbursements

in the percentages set forth in paragraph (d) unless the

professional whose statement is objected to seeks an order

from the Court, upon notice and a hearing, directing

payment to be made;

(f) If the parties to an objection are able to resolve their

dispute following the service of a Notice of Objection to

Fee Statement and if the party whose statement was

objected to serves on the Notice Parties a statement

indicating that the objection is withdrawn and describing in

detail the terms of the resolution, then the Debtor shall

promptly pay, in accordance with paragraph (d), that

portion of the fee statement which is no longer subject to an

objection;

(g) All objections that are not resolved by the parties

shall be preserved and presented to the Court at the next

interim or final fee application hearing to be held by the

Court (see sub-paragraph (i) below);

(h) The service of an objection in accordance with

paragraph (c) shall not prejudice the objecting party’s right

to object to any fee application made to the Court in

accordance with the Bankruptcy Code on any ground

whether raised in the objection or not. Furthermore, the

decision by any party not to object to a fee statement shall


5

not be a waiver of any kind or prejudice that party’s right to

object to any fee application subsequently made to the

Court in accordance with the Bankruptcy Code;

(i) Approximately every one hundred twenty (120)

days, but no more than every one hundred fifty (150) days,

each of the Retained Professionals shall serve and file with

the Court an application for interim or final Court approval

and allowance, pursuant to sections 330 and 331 of the

Bankruptcy Code (as the case may be), of the compensation

and reimbursement of expenses requested and the Debtor

shall schedule a hearing at which all such applications will

be heard;

(j) No notice of hearing should be filed by

professionals in connection therewith, as the Debtor will

schedule a hearing at which all fee applications will be

heard. At least thirty (30) days before the hearing, the

Debtor’s attorneys shall file a notice with the Court, served

upon the U.S. Trustee and all Retained Professionals, that

sets forth the time, date and location of the fee hearing, the

date by which the fee applications must be filed, the period

covered by such application and the objection deadline.

Any Retained Professional unable to file its own fee

application with the Court shall deliver to the Debtor’s

attorneys a fully executed copy with original signatures,

along with service copies, three (3) days before the filing

deadline. The Debtor’s attorneys shall file and serve such

application;

(k) Any Retained Professional who fails to file an

interim fee application seeking approval of compensation

and expenses previously paid under this Motion when due

shall (i) be ineligible to receive further monthly payments

of fees or expenses as provided herein until further order of

the Court and (ii) may be required to disgorge any fees paid

since retention or the last interim fee application,

whichever is later;

(l) The pendency of an interim fee application or a

Court order that payment of compensation or

reimbursement of expenses was improper as to a particular

statement shall not disqualify a Retained Professional from

the future payment of compensation or reimbursement of


6

expenses as set forth above, unless otherwise ordered by

the Court;

(m) Neither the payment of, nor the failure to pay, in

whole or in part, monthly compensation and reimbursement

as provided herein, shall have any effect on the Court’s

interim or final allowance of compensation and

reimbursement of any Retained Professional; and

(n) Counsel for the official committee of unsecured

creditors may, in accordance with the foregoing procedure

for monthly compensation and reimbursement of Retained

Professionals, collect and submit statements of expenses

(excluding individual committee members’ counsel

expenses), with supporting evidence of payment, from

members of the committee that he or she represents;

provided, however, that such committee attorneys ensure

that these reimbursement requests comply with General

Order M-447.

The Debtor requests that the Court limit service of interim fee applications and 7.

the final fee application (collectively, the “Fee Applications”) to the Notice Parties. The Debtor

further requests that all other parties that have filed a notice of appearance with the Clerk of this

Court and requested notice of pleadings in these Chapter 11 Cases shall be entitled to receive

only notice of hearings on the Fee Applications (the “Hearing Notices”). Serving the Fee

Applications and the Hearing Notices in this manner will permit the parties most active in this

Chapter 11 Case to review and object to the Retained Professionals’ fees and will save

unnecessary duplication and mailing expenses.

BASIS FOR RELIEF

Pursuant to section 331 of the Bankruptcy Code and Local Rule 2016-1, all 8.

professionals are entitled to submit applications for interim compensation and reimbursement of

expenses not more than once every one hundred and twenty (120) days, but no more than one

hundred fifty (150) days, or more often if the court permits.


7

Establishing streamlined procedures for the timely payment of Retained 9.

Professionals will promote the efficient administration of this Chapter 11 Case. The

Compensation Procedures will enable the Debtor, U.S. Trustee and Creditors’ Committee to

closely monitor administrative costs, maintain cash flow availability, and ensure the

reasonableness and necessity of the compensation and reimbursement sought pursuant to these

procedures.

The relative complexity of this Chapter 11 case and the amount of time and effort 10.

that will be required from the Retained Professionals justifies establishing the Compensation

Procedures. Indeed, the Compensation Procedures are necessary to ensure that Retained

Professionals are fairly and timely compensated for their services and are not force to bear undue

financial burden or risk caused by delays in payment.

The Debtor submits that the Compensation Procedures are in substantial 11.

compliance with Local Rule 2016-1 and General Order M-447 and consistent with interim

compensation procedures established in other Chapter 11 cases in this district. See, e.g., In re

dELiA*s, Inc., No. 14-23678 (RDD) (Jan. 1, 2015); In re Genco Shipping & Trading Limited,

No. 14-11108 (SHL) (Bankr. S.D.N.Y. May 16, 2014); In re MPM Silicones, LLC, No. 14-

22503 (RDD) (Bankr. S.D.N.Y. May 16, 2014).

NOTICE

Notice of this Motion has or will be given to: (i) the Office of the United States 12.

Trustee; (ii) counsel to the Official Committee of Unsecured Creditors; and (iii) any such other

party entitled to notice pursuant to Bankruptcy Rule 2002 and Local Bankruptcy Rule for the

Southern District of New York 9013-1(b).

NO PRIOR REQUEST

No previous request for the relief sought herein has been made to this Court or 13.


8

any other court.

CONCLUSION

WHEREFORE, the Debtor respectfully requests that the Court enter an order

substantially in the form attached hereto, granting the relief requested in the Motion and such

other and further relief as may be just and proper.

Dated: New York, New York

March 7, 2016

Respectfully submitted,

/s/ Kevin J. Nash

Kevin J. Nash

Evan M. Lazerowitz


Counsel for the Debtor

1501 Broadway – 22nd

Floor


Telephone: (212) 221-5700

[email protected]

x:\gwfg\new data\yen\word\joyce leslie\motions\professional compensation\professional compensation motion.docx


EXHIBIT A

Proposed Order

16-22035-rdd Doc 200-1 Filed 03/07/16 Entered 03/07/16 16:06:38 Exhibit A - Proposed Order Pg 1 of 7



In re:

Chapter 11

Joyce Leslie, Inc., Case No. 16-22035 (RDD)

Debtor.

ORDER ON DEBTOR’S MOTION TO ESTABLISH



Upon the motion (the “Motion”)1 of the Debtor for an order establishing procedures for

interim compensation and reimbursement of expenses of professionals pursuant to 11 U.S.C. §§

105(a) and 331, Rule 2016 of the Federal Rules of Bankruptcy Procedure, Rule 2016-1 of the

Local Rules of the United States Bankruptcy Court for the Southern District of New York, and

General Order M-447; and due and sufficient notice of the Motion having been given under the

particular circumstances; and it appearing that the relief requested by the Motion is in the best

interests of the Debtor and its creditors, and after due deliberation thereon and sufficient cause

appearing therefor, it is hereby

ORDERED, ADJUDGED AND DECREED that:

1. The Motion is granted as set forth herein.

2. Except as may otherwise be provided in orders of this Court authorizing the

retention of specific professionals, all Retained Professionals in this Chapter 11 Case may seek

interim compensation in accordance with the following procedures (the “Compensation

Procedures”):

(a) By the twentieth (20th) day of each month following the

month for which compensation is sought or as soon as practicable

1 All capitalized terms used but otherwise not defined herein shall have the meanings set forth in the Motion.


2

thereafter, each Retained Professional seeking compensation

pursuant to this Order will file with the Court a monthly fee

statement (a “Monthly Fee Statement”) and serve it by hand or

overnight delivery on the following parties (collectively, the

“Notice Parties”): (a) counsel to the Debtor, Goldberg Weprin

Finkel Goldstein LLP, 1501 Broadway, 22nd Floor, New York,

New York 10036, Attn: Kevin J. Nash; (b) counsel for the

Official Committee of Unsecured Creditors, Cooley LLP, 1114

Avenue of the Americas, New York, New York 10036, Attn: Jay

R. Indyke and Seth Van Aalten; and (c) the U.S. Trustee, U.S.

Federal Office Building, 201 Varick Street, Suite 1006, New

York, New York 10014, Attn: Susan Golden.

A courtesy copy need not be delivered to Chambers since any

order on the Motion is not intended to alter the fee application

requirements outlined in sections 330 and 331 of the Bankruptcy

Code and since Retained Professionals are still required to serve

and file interim and final applications for approval of fees and

expenses in accordance with the relevant provisions of the

Bankruptcy Code, the Bankruptcy Rules and the Local Rules;

(b) For those Retained Professionals who bill based on time,

each Monthly Fee Statement must contain a list of the individuals

and their respective titles (e.g., attorney, accountant, or paralegal)

who provided services during the statement period, their

respective billing rates, the aggregate hours spent by each

individual, a reasonably detailed breakdown of the disbursements

incurred, and contemporaneously maintained time entries for each

individual in increments of tenths (1/10) of an hour, unless the

Court orders otherwise with respect to an individual firm’s

retention. No Retained Professional should seek reimbursement of

an expense which would otherwise not be allowed pursuant to the

Amended Guidelines for Fees and Disbursements for

Professionals in Southern District of New York Bankruptcy Cases

(“General Order M-447”);

(c) Each person receiving a statement will have the later of (i)

fourteen (14) days after its receipt of the statement or (ii) the

thirty-fifth (35) day following the end of the month for which

compensation is sought (the “Objection Deadline”) to review it

and, in the event that he or she has an objection to the

compensation or reimbursement sought in a particular statement,

serve upon the Retained Professional whose statement is objected


3

to, and the Notice Parties, a written “Notice of Objection to Fee

Statement” setting forth the nature of the objection and the

amount of fees or expenses at issue;

(d) At the expiration of the Objection Deadline, the Debtor

shall promptly pay 80% of the undisputed fees and 100% of the

undisputed expenses identified in each monthly statement to

which no objection has been served in accordance with paragraph

(c);

(e) If the Debtor receives an objection to a particular fee

statement, it shall withhold payment on that portion of the fee

statement to which the objection is directed and promptly pay the

remainder of the fees and disbursements in the percentages set

forth in paragraph (d) unless the professional whose statement is

objected to seeks an order from the Court, upon notice and a

hearing, directing payment to be made;

(f) If the parties to an objection are able to resolve their

dispute following the service of a Notice of Objection to Fee

Statement and if the party whose statement was objected to serves

on the Notice Parties a statement indicating that the objection is

withdrawn and describing in detail the terms of the resolution,

then the Debtor shall promptly pay, in accordance with paragraph

(d), that portion of the fee statement which is no longer subject to

an objection;

(g) All objections that are not resolved by the parties shall be

preserved and presented to the Court at the next interim or final

fee application hearing to be held by the Court (see sub-paragraph

(i) below);

(h) The service of an objection in accordance with paragraph

(c) shall not prejudice the objecting party’s right to object to any

fee application made to the Court in accordance with the

Bankruptcy Code on any ground whether raised in the objection

or not. Furthermore, the decision by any party not to object to a

fee statement shall not be a waiver of any kind or prejudice that

party’s right to object to any fee application subsequently made to

the Court in accordance with the Bankruptcy Code;

(i) Approximately every one hundred twenty (120) days, but

no more than every one hundred fifty (150) days, each of the

Retained Professionals shall serve and file with the Court an


4

application for interim or final Court approval and allowance,

pursuant to sections 330 and 331 of the Bankruptcy Code (as the

case may be), of the compensation and reimbursement of

expenses requested and the Debtor shall schedule a hearing at

which all such applications will be heard;

(j) No notice of hearing should be filed by professionals in

connection therewith, as the Debtor will schedule a hearing at

which all fee applications will be heard. At least thirty (30) days

before the hearing, the Debtor’s attorneys shall file a notice with

the Court, served upon the U.S. Trustee and all Retained

Professionals, that sets forth the time, date and location of the fee

hearing, the date by which the fee applications must be filed, the

period covered by such application and the objection deadline.

Any Retained Professional unable to file its own fee application

with the Court shall deliver to the Debtor’s attorneys a fully

executed copy with original signatures, along with service copies,

three (3) days before the filing deadline. The Debtor’s attorneys

shall file and serve such application;

(k) Any Retained Professional who fails to file an interim fee

application seeking approval of compensation and expenses

previously paid under this Motion when due shall (i) be ineligible

to receive further monthly payments of fees or expenses as

provided herein until further order of the Court and (ii) may be

required to disgorge any fees paid since retention or the last

interim fee application, whichever is later;

(l) The pendency of an interim fee application or a Court

order that payment of compensation or reimbursement of

expenses was improper as to a particular statement shall not

disqualify a Retained Professional from the future payment of

compensation or reimbursement of expenses as set forth above,

unless otherwise ordered by the Court;

(m) Neither the payment of, nor the failure to pay, in whole or

in part, monthly compensation and reimbursement as provided

herein, shall have any effect on the Court’s interim or final

allowance of compensation and reimbursement of any Retained

Professional; and

(n) Counsel for the official committee of unsecured creditors

may, in accordance with the foregoing procedure for monthly

compensation and reimbursement of Retained Professionals,


5

collect and submit statements of expenses (excluding individual

committee members’ counsel expenses), with supporting evidence

of payment, from members of the committee that he or she

represents; provided, however, that such committee attorneys

ensure that these reimbursement requests comply with General

Order M-447.

3. The first Monthly Fee Statement period shall be the period beginning on

the Petition Date and ending on January 31, 2016. The second Monthly Fee Statement

period shall be the period beginning on February 1, 2016 and ending on February 29,

2016. The Monthly Fee Statements for the periods beginning on the Petition Date and

ending on February 29, 2016, shall be due 10 days after entry of this Order. All

subsequent Monthly Fee Statements shall be due in accordance with the Compensation

Procedures.

4. All Retained Professionals not retained as of the Petition Date shall submit

their first Monthly Fee Statement for the period from the effective date of their retention

through the end of the first full calendar month following the effective date of their

retention, ad otherwise in accordance with the procedures set forth in this Order.

5. The Debtor shall include all payments to Retained Professionals on its

monthly operating reports, detailed so as to state the amount paid to each of the

professionals.

6. Any and all other further notice of the relief requested in the Motion shall

be, and is hereby, dispensed with and waived; provided however, that the Debtor must

serve a copy of this Order on all the Notice Parties.

7. All Fee Application periods shall begin on the first day of each calendar

month and end on the last day of the last month.

8. Service of full copies of the Fee Applications is limited to the Notice


6

Parties. All other parties that have filed a notice of appearance in this Chapter 11 Case

shall be served with a Hearing Notice only, with a right to receive copies of the Fee

Applications upon written request. Notice given in accordance with this paragraph is

deemed sufficient and adequate and in full compliance with the applicable provisions of

the Bankruptcy Code, the Bankruptcy Rules, and the Local Rules of this Court.

9. Any Monthly fee Statement served on the Notice Parties prior to the entry

of this Order shall be governed by the terms of this Order.

10. Any party may object to requests for payments made pursuant to this Order

on the grounds that (a) the Debtor has not timely filed monthly operating reports; (b) the

Debtor has not remained current with their administrative expenses and 28 U.S.C. § 1930

bankruptcy fees, or (c) a manifest exigency exists by seeking a further order of this Court;

otherwise, this Order shall continue and shall remain in effect during the pendency of this

Chapter 11 Case.

11. All time periods referenced in this Order shall be calculated in accordance

with Rule 9006(a) of the Federal Rules of Bankruptcy Procedure.

12. The terms and conditions of this Order shall be immediately effective and

enforceable upon its entry.

13. This Court shall retain jurisdiction with respect to all matters arising from

or related to the implementation or interpretation of this Order.

Dated: White Plains, New York

March __, 2016

ROBERT D. DRAIN

UNITED STATES BANKRUPTCY JUDGE


Hearing Date and Time: March 22, 2016, at 10:00 a.m.

Objection Deadline: March 15, 2016

Kevin J. Nash

Evan M. Lazerowitz


1501 Broadway, 22nd Floor


Telephone: (212) 221-5700

Facsimile: (212) 335-4501 Counsel for the Debtor



In re:

Chapter 11

Joyce Leslie, Inc., Case No. 16- 22035 (RDD)

Debtor.

NOTICE OF HEARING ON DEBTOR’S MOTION TO ESTABLISH



PLEASE TAKE NOTICE that upon the annexed motion of Joyce Leslie, Inc., the

undersigned will move before the Honorable Robert D. Drain at the U.S. Bankruptcy Court, 300

Quarropas Street, White Plains, New York on March 22, 2016 at 10:00 a.m., for an order approving

the Debtor’s motion to establish procedures for the interim compensation and reimbursement of

expenses of professionals.

PLEASE TAKE FURTHER NOTICE THAT that any Objection to the proposed order

and request for a hearing must be filed with the Court in accordance with the Court’s ECF

system, with a copy delivered to Judge Drain, and served upon: (a) counsel to the Debtor,

Goldberg Weprin, Finkel Goldstein LLP, 1501 Broadway, 22nd Floor, New York, New York

10036, Attn: Kevin J. Nash; (b) counsel for the Official Committee of Unsecured Creditors,

Cooley LLP, 1114 Avenue of the Americas, New York, New York 10036, Attn: Jay R. Indyke

16-22035-rdd Doc 200-2 Filed 03/07/16 Entered 03/07/16 16:06:38 Notice of Hearing Pg 1 of 2

2

and Seth Van Aalten; and (c) the U.S. Trustee, U.S. Federal Office Building, 201 Varick Street,

Suite 1006, New York, New York 10014, Attn: Susan Golden, so as to be received no later than

March 15, 2016.

Dated: New York, New York

March 7, 2016

GOLDBERG WEPRIN FINKEL GOLDSTEIN LLP

Attorneys for the Debtor

1501 Broadway, 22nd

Floor


(212) 221-5700

By: /s/ Kevin J. Nash, Esq.

16-22035-rdd Doc 200-2 Filed 03/07/16 Entered 03/07/16 16:06:38 Notice of Hearing Pg 2 of 2

Documents

Hearing Date and Time: March 22, 2016, at 10:00 a.m ... · detailed breakdown of the disbursements incurred, and contemporaneously maintained time entries for each individual in increments