UNITED STATES BANKRUPTCY COURT EASTERN DISTRICT OF MICHIGAN SOUTHERN DIVISION IN RE: Case No. 20-51066-mar HENRY FORD VILLAGE, INC., Chapter 11 Debtor. Honorable Mark A. Randon ________________________________ APPLICATION TO EMPLOY DYKEMA GOSSETT PLLC AS DEBTOR’S COUNSEL Henry Ford Village, Inc. (the “Debtor”), debtor and debtor-in-possession in the above-referenced chapter 11 case (the “Chapter 11 Case”), through proposed counsel, Dykema Gossett PLLC, for its Application to Employ Dykema Gossett PLLC as Debtor’s Counsel (the “Application”), states as follows: JURISDICTION AND VENUE 1. The Court has jurisdiction over this matter pursuant to 28 U.S.C. §§ 157 and 1334. 2. This is a core proceeding under 28 U.S.C. § 157(b). 3. Venue is proper in this district under 28 U.S.C. §§ 1408 and 1409. 4. To the extent this Application is granted, Debtors request that any order be applicable to all of Debtors’ cases. 120951.000001 4815-0991-8416.1 1 20-51066-mar Doc 18 Filed 10/28/20 Entered 10/28/20 20:17:10 Page 1 of 51 BACKGROUND 5. Debtor commenced this Chapter 11 Case under chapter 11 of title 11 of the United States Code (the “Bankruptcy Code”) on October 28, 2020 (the “Petition Date”). 6. Debtor is continuing in possession of its property and is operating and managing its business as debtor-in-possession under 11 U.S.C. §§ 1107(a) and 1108. 7. As of the date of filing this Application, no trustee, examiner, or official committee of unsecured creditors has been appointed in this Chapter 11 Case. 8. Detailed facts about Debtor and the reasons for the commencement of the Chapter 11 Case are set forth in the Declaration of Chief Restructuring Officer in Support of the Debtor’s Chapter 11 Petition and First Day Pleadings, which has been filed simultaneously with this Application and is incorporated into this Application by reference. 9. Debtor intends to supplement this Application with additional information and disclosures in compliance with the United States Trustees’ Guidelines, including the Large Fees Guidelines. RELIEF REQUESTED 10. Debtor requests that the Court authorize Debtor to retain and employ Dykema Gossett PLLC (“Dykema” or the “Firm”) as attorneys in connection with the commencement and prosecution of the Chapter 11 Case. 120951.000001 4815-0991-8416.1 2 20-51066-mar Doc 18 Filed 10/28/20 Entered 10/28/20 20:17:10 Page 2 of 51 BASIS FOR RELIEF 11. Section 327(a) of the Bankruptcy Code provides that a debtor, subject to court approval, “may employ one or more attorneys, accountants, appraisers, auctioneers, or other professional persons, that do not hold or represent an interest adverse to the estate, and that are disinterested persons, to represent or assist the [debtor-in-possession] in carrying out the [debtor-in-possession’s] duties under this title.” 11 U.S.C. § 327(a). 12. Rule 2014 of the Federal Rules of Bankruptcy Procedures (the “Bankruptcy Rules”) requires that an application for retention include: [S]pecific facts showing the necessity for the employment, the name of the [firm] to be employed, the reasons for the selection, the professional services to be rendered, any proposed arrangement for compensation, and, to the best of the applicant’s knowledge, all of the [firm’s] connections with the debtor, creditors, any other party in interest, its respective attorneys and accountants, the United States trustee, or any person employed in the office of the United States trustee. FED. R. BANKR. P. 2014. A. Necessity and Qualifications 13. Debtor has selected Dykema primarily because Dykema has extensive experience in the fields of bankruptcy, bankruptcy litigation, corporate restructuring, and insolvency. 120951.000001 4815-0991-8416.1 3 20-51066-mar Doc 18 Filed 10/28/20 Entered 10/28/20 20:17:10 Page 3 of 51 14. Debtor has been a long-time client of Dykema, and Dykema has provided a variety of legal services to Debtor in the past, including, but not limited to, corporate, litigation, and regulatory counsel, on various matters. 15. On September 24, 2020, Debtor and Dykema entered into a new engagement agreement for Dykema to provide legal services to Debtor in connection with various financial restructuring and regulatory issues, which have led to the filing of this Chapter 11 Case. 16. Dykema is familiar with Debtor’s business operations and the issues that will pose the biggest challenges in this Chapter 11 Case. Accordingly, Dykema has the necessary background to deal effectively with the potential legal issues that may arise in this Chapter 11 Case. Based on the foregoing, Debtor believes that Dykema is both well qualified and uniquely able to represent Debtor in this Chapter 11 Case in an efficient and timely manner. B. Services to Be Provided 17. Dykema is expected to render legal services to Debtor, including reorganization of Debtor through Chapter 11 and/or a sale of Debtor’s assets. It is expected that Dykema’s services will include, without limitation, assisting, advising, and representing Debtor with respect to: i. Preparation, filing, and prosecution of Debtor’s bankruptcy petitions, schedules, statements of financial affairs, and various motions essential to or required in this Chapter 11 Case; 120951.000001 4815-0991-8416.1 4 20-51066-mar Doc 18 Filed 10/28/20 Entered 10/28/20 20:17:10 Page 4 of 51 ii. Preparation, filing, and defense of objections to various motions, claims, and actions by creditors and parties-in-interest; iii. Negotiation with various creditors, including any creditor committees; iv. Negotiation with potential plan proponents and/or purchasers of Debtor’s assets, and the preparation of related agreements; v. Advisement on matters regarding the restructuring of debts and financial structure; and vi. Any other bankruptcy related administrative matters arising during the court of this Chapter 11 Case. C. Professional Compensation 18. Dykema has indicated its willingness to serve as counsel to Debtor and to receive compensation and reimbursement in accordance with Dykema’s standard billing practices for services rendered and expenses incurred on behalf of Debtor. 19. Dykema received a retainer of $261,168.19 from Debtor under the engagement agreement in connection with legal services rendered that have led to this Chapter 11 Case. As of the Petition Date, Debtor has $201,983.69 retainer with Dykema in connection with this Chapter 11 Case. 20. Dykema fully earned the pre-petition fees and/or expenses before the Petition Date. 21. After the Petition Date, Dykema intends to apply to the Court for allowance of compensation for professional services rendered and reimbursement of charges and disbursements incurred in this Chapter 11 Case in accordance with 120951.000001 4815-0991-8416.1 5 20-51066-mar Doc 18 Filed 10/28/20 Entered 10/28/20 20:17:10 Page 5 of 51 applicable provisions of the Bankruptcy Code, Bankruptcy Rules, Local Bankruptcy Rules for the Eastern District of Michigan, United States Trustee Guidelines for Region 9, and any orders of this Court. Dykema will seek compensation for services of each professional at Dykema’s then-current regional hourly rates. 22. Dykema’s hourly billing rates for professionals are not intended to cover out-of-pocket expenses, and some overhead items that are typically billed separately. For example, Dykema regularly charges its clients for the expenses and disbursements incurred in connection with the client’s case, including photocopying, witness fees, litigation support services, travel expenses, filing and recording fees, postage, express mail and messenger charges, computerized legal research charges and other computer services, and expenses for working meals. 23. Other than as set forth in this Application and in the Declaration of Sheryl L. Toby attached hereto as Exhibit B (the “Toby Declaration”), no agreement or understanding exists between Debtor and Dykema or any other entity for the sharing of compensation received or to be received for services rendered in connection with this Chapter 11 Case. Copies of biographies of Dykema’s primary professionals and paraprofessionals in this Chapter 11 Case are attached hereto as Exhibit C. 120951.000001 4815-0991-8416.1 6 20-51066-mar Doc 18 Filed 10/28/20 Entered 10/28/20 20:17:10 Page 6 of 51 D. No Adverse Interest, Disinterestedness, and Disclosure of Connections 24. To the best of Debtor’s knowledge, the members and associates of Dykema: (a) do not have any connection with Debtor, its creditors, the Office of the United States Trustee for the Eastern District of Michigan, any person employed in the Office of the United States Trustee for the Eastern District of Michigan, or any other party-in-interest or its respective attorneys and accountants; (b) are “disinterested person[s],” as that term is defined 11 U.S.C. § 101(14); and (c) do not hold or represent an interest adverse to Debtor’s estate. 25. More specifically: i. None of the attorneys of Dykema holds or represents an interest adverse to Debtor’s estate. ii. Neither Dykema, nor any attorney of Dykema, is or was a creditor, equity holder, or an insider of Debtor. iii. Neither Dykema, nor any attorney of Dykema, is or was, within two years before the Petition Date, a director, officer, or employer of Debtor. iv. Dykema does not have any interest materially adverse to the interests of Debtor’s estate or of any class of creditors by reason of any direct or indirect relationship to, connection with, or interest in Debtor, or for any other reason. 26. As part of its diverse practice, Dykema appears in numerous cases, proceedings, and transactions involving many different professionals, including attorneys, accountants, investment bankers, and financial consultants, some of which may represent claimants and parties-in-interest in this Chapter 11 Case.