Latest Mortgages Ltd. Dispute Centers On Legal Fees

Law360, New York (February 10, 2009, 12:00 AM EST) -- Not satiated by prior disputes, the creditors and debtors in the contentious Mortgages Ltd. bankruptcy are now battling over whether the company should pay legal fees to its executives embroiled in a U.S. Securities and Exchange Commission investigation.

The official committee of unsecured creditors and other parties in the case had previously argued that Mortgages improperly offered to indemnify certain officers and employees for prepetition misconduct.

They said, among other things, that the home loan firm was a “corrupt organization” and a “Ponzi scheme,” and that...
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