At the powerful law firm of Hogan Lovells, partner Neal Katyal is decidedly a “rainmaker.”
So what does it cost to make it rain? $2,465. Per hour.
That’s what it takes to do business with Katyal, 52, formerly the Acting Solicitor General of the United States during the Obama administration.
And it’s the rate that Johnson & Johnson is willing to pony up in its controversial bankruptcy case in which it is trying to free itself from potentially billions in liabilities over its talc products.
Just one problem: The U.S. government doesn’t want to see the Big Kat in court. In the Chapter 11 case, the U.S. has asked a New Jersey judge to block LTL Management LLC—the company J&J has established in which to funnel roughly 38,000 talc lawsuits—from employing Katyal considering his hourly rate is “significantly higher” than those of the lawyers from seven other law firms who are litigating the case.
LTL wants Katyal on the job because of his success in federal appeals cases. But in bankruptcy cases, a claimant’s legal fees must be approved by the court.
J&J got a big win in court in February when New Jersey judge Michael Kaplan grudgingly affirmed the company’s ability to use Chapter 11 to hasten a settlement to resolve the talc claims.
But earlier this month, the Third U.S. Circuit Court of Appeals said it would revisit the tactic, known as the Texas Two-Step. The ploy has been used by other companies to protect assets and avoid the cost of litigation and settlements.