Brittany A. Klinger

A lawyer for the special master overseeing the auction of Citgo to satisfy billions of dollars' worth of Venezuelan debt has defended his request for more than $15.3 million in fees on top of nearly $63 million already paid, saying the request follows an "extraordinarily complex" sale process. In a letter submitted to a Delaware federal court on Monday, Potter Anderson & Corroon LLP partner Bindu Ann Palapura acknowledged that the $15.346 million in fees incurred by special master Robert Pincus and his advisors during September, October and November last year were "undoubtedly significant." She nevertheless defended the fee request as warranted, given the extensive labor and legal expertise that was necessary to finalize the sale process, which resulted in a $5.892 billion bid from hedge fund Elliott Investment Management LP that was accepted by the court late last year. The letter comes after Gold Reserve Ltd. — whose $7.382 billion bid for Citgo was rejected last year after being initially accepted by Pincus — complained in a Feb. 23 letter to the court that the fee request was "staggering." Gold Reserve argued, in part, that the $10.2 million in legal fees charged by Weil Gotshal & Manges LLP was unreasonable, noting that the request includes time entries from 41 attorneys at an average hourly rate of $1,566.83, with only two staff attorneys charging less than $1,000 per hour. But Palapura argued that Gold Reserve is downplaying the "scope and breadth" of work the special master's advisors had to perform during the three months in question. "Gold Reserve also largely ignores the complexity of the matter, the special master's dual role as both an arm of the court and a litigant, and the evidentiary burden placed on the special master in supporting his recommended bid," she wrote. Gold Reserve and others had already argued in 2024 that the fees incurred by Pincus were too high, resulting in a court order from U.S. Circuit Judge Leonard P. Stark requiring that Pincus evaluate "whether the number of timekeepers can be reduced" and whether Weil could "still justify billing on an ongoing basis at the same non-discounted rates they have been charging for the first 44 months of their engagement with this case." Palapura rebutted Gold Reserve's allegations in its letter last month that Pincus had not complied with the order, noting that he had significantly reduced the number of timekeepers and discussed the discounted fee issue. "The special master discussed the issue with Weil and determined that, in light of the revised billing procedures that the advisors implemented beginning in January 2025, there was no reason for Weil to deviate from the standard billing rates that it had been charging for the sale process to that point without objection," she wrote. The fee dispute comes just weeks after Pincus lost his bid to have Venezuela and Gold Reserve pay his $3.1 million bill for defending against their unsuccessful bid to have him disqualified in the long-running litigation over the sale of Citgo. In a Feb. 9 order, Judge Stark said he was "not persuaded this situation merits requiring the moving parties to bear more than their ordinary share of the special master's fees associated with the motions." The sales process for Citgo resulted in Judge Stark approving the $5.892 billion bid from hedge fund Elliott — submitted formally by Elliott affiliate Amber Energy Inc. — last fall. In his ruling, the judge concluded that it offered the best overall combination of price and certainty of closing of any bid submitted. Judge Stark, formerly a district court judge for the U.S. District Court for the District of Delaware, was elevated to the Federal Circuit in 2022, but he continues to oversee a variety of cases brought by creditors against Venezuela in Delaware federal court. The Delaware court is conducting the long-awaited sale nearly eight years after defunct Canadian mining company Crystallex International Corp. won an attachment order over shares in PDV Holding Inc., the indirect parent company of Citgo. PDV Holding is a subsidiary of Venezuelan state-owned oil company Petróleos de Venezuela SA, or PDVSA. Crystallex is looking to enforce a $1.2 billion arbitral award it won against Venezuela after being ousted from a lucrative Venezuelan gold-mining project. In the years since then, the litigation has attracted other creditors of Venezuela owed billions of dollars more, since Citgo is Venezuela's most significant seizable asset. Those creditors include Gold Reserve, which won its $713 million arbitral award in September 2014 after Venezuela yanked its permit for a gold-mining project. Gold Reserve initially won the nod from Pincus as his chosen bidder in a final recommendation last year, with a $7.4 billion bid. But the special master later changed his mind, issuing an updated final recommendation that the court approve the $5.9 billion bid from Elliott. Counsel and representatives for the parties declined to comment or could not immediately be reached for comment on Tuesday. Gold Reserve is represented by Kevin J. Mangan, Matthew P. Ward and Stephanie S. Riley of Womble Bond Dickinson, Matthew H. Kirtland, Katherine G. Connolly and Taylor J. LeMay of Norton Rose Fulbright, and by Michael J. Bowe, Lauren Tabaksblat, Andrew T. Sutton and Kate E. Fisch of Brithem LLP. Pincus is represented by Matthew F. Davis, Bindu A. Palapura and Malisa C. Dang of Potter Anderson & Corroon LLP, and by Matthew S. Barr, David J. Lender, Jared R. Friedmann and Chase A. Bentley of Weil Gotshal & Manges LLP. Venezuela is represented by Donald B. Verrilli Jr., Elaine J. Goldenberg, Ginger D. Anders, George M. Garvey and Adeel Mohammadi of Munger Tolles & Olson LLP. PDVSA is represented by Joseph D. Pizzurro, Kevin A. Meehan, Juan O. Perla, Robert Groot and David V. Holmes of Curtis Mallet-Prevost Colt & Mosle LLP. Delaware counsel for Venezuela and PDVSA are Samuel Taylor Hirzel II and Brendan Patrick McDonnell of Heyman Enerio Gattuso & Hirzel LLP. PDV Holding and Citgo are represented by Susan W. Waesco and Alexandra M. Cumings of Morris Nichols Arsht & Tunnell LLP, and by Nathan P. Eimer, Daniel D. Birk and Gregory M. Schweizer of Eimer Stahl LLP. Crystallex is represented by Raymond J. DiCamillo, Jeffrey L. Moyer and Travis S. Hunter of Richards Layton & Finger PA, and by Robert L. Weigel, Jason W. Myatt, Rahim Moloo, Miguel A. Estrada, Lucas C. Townsend, Zachary Kady and Adam M. Smith of Gibson Dunn & Crutcher LLP. The case is Crystallex International Corp. v. Bolivarian Republic of Venezuela, case number 1:17-mc-00151, in the U.S. District Court for the District of Delaware.

Mar 3

5 min

A lawyer for the special master overseeing the auction of Citgo to satisfy billions of dollars' worth of Venezuelan debt has defended his request for more than $15.3 million in fees on top of nearly $63 million already paid, saying the request follows an "extraordinarily complex" sale process. In a letter submitted to a Delaware federal court on Monday, Potter Anderson & Corroon LLP partner Bindu Ann Palapura acknowledged that the $15.346 million in fees incurred by special master Robert Pincus and his advisors during September, October and November last year were "undoubtedly significant." She nevertheless defended the fee request as warranted, given the extensive labor and legal expertise that was necessary to finalize the sale process, which resulted in a $5.892 billion bid from hedge fund Elliott Investment Management LP that was accepted by the court late last year. The letter comes after Gold Reserve Ltd. — whose $7.382 billion bid for Citgo was rejected last year after being initially accepted by Pincus — complained in a Feb. 23 letter to the court that the fee request was "staggering." Gold Reserve argued, in part, that the $10.2 million in legal fees charged by Weil Gotshal & Manges LLP was unreasonable, noting that the request includes time entries from 41 attorneys at an average hourly rate of $1,566.83, with only two staff attorneys charging less than $1,000 per hour. But Palapura argued that Gold Reserve is downplaying the "scope and breadth" of work the special master's advisors had to perform during the three months in question. "Gold Reserve also largely ignores the complexity of the matter, the special master's dual role as both an arm of the court and a litigant, and the evidentiary burden placed on the special master in supporting his recommended bid," she wrote. Gold Reserve and others had already argued in 2024 that the fees incurred by Pincus were too high, resulting in a court order from U.S. Circuit Judge Leonard P. Stark requiring that Pincus evaluate "whether the number of timekeepers can be reduced" and whether Weil could "still justify billing on an ongoing basis at the same non-discounted rates they have been charging for the first 44 months of their engagement with this case." Palapura rebutted Gold Reserve's allegations in its letter last month that Pincus had not complied with the order, noting that he had significantly reduced the number of timekeepers and discussed the discounted fee issue. "The special master discussed the issue with Weil and determined that, in light of the revised billing procedures that the advisors implemented beginning in January 2025, there was no reason for Weil to deviate from the standard billing rates that it had been charging for the sale process to that point without objection," she wrote. The fee dispute comes just weeks after Pincus lost his bid to have Venezuela and Gold Reserve pay his $3.1 million bill for defending against their unsuccessful bid to have him disqualified in the long-running litigation over the sale of Citgo. In a Feb. 9 order, Judge Stark said he was "not persuaded this situation merits requiring the moving parties to bear more than their ordinary share of the special master's fees associated with the motions." The sales process for Citgo resulted in Judge Stark approving the $5.892 billion bid from hedge fund Elliott — submitted formally by Elliott affiliate Amber Energy Inc. — last fall. In his ruling, the judge concluded that it offered the best overall combination of price and certainty of closing of any bid submitted. Judge Stark, formerly a district court judge for the U.S. District Court for the District of Delaware, was elevated to the Federal Circuit in 2022, but he continues to oversee a variety of cases brought by creditors against Venezuela in Delaware federal court. The Delaware court is conducting the long-awaited sale nearly eight years after defunct Canadian mining company Crystallex International Corp. won an attachment order over shares in PDV Holding Inc., the indirect parent company of Citgo. PDV Holding is a subsidiary of Venezuelan state-owned oil company Petróleos de Venezuela SA, or PDVSA. Crystallex is looking to enforce a $1.2 billion arbitral award it won against Venezuela after being ousted from a lucrative Venezuelan gold-mining project. In the years since then, the litigation has attracted other creditors of Venezuela owed billions of dollars more, since Citgo is Venezuela's most significant seizable asset. Those creditors include Gold Reserve, which won its $713 million arbitral award in September 2014 after Venezuela yanked its permit for a gold-mining project. Gold Reserve initially won the nod from Pincus as his chosen bidder in a final recommendation last year, with a $7.4 billion bid. But the special master later changed his mind, issuing an updated final recommendation that the court approve the $5.9 billion bid from Elliott. Counsel and representatives for the parties declined to comment or could not immediately be reached for comment on Tuesday. Gold Reserve is represented by Kevin J. Mangan, Matthew P. Ward and Stephanie S. Riley of Womble Bond Dickinson, Matthew H. Kirtland, Katherine G. Connolly and Taylor J. LeMay of Norton Rose Fulbright, and by Michael J. Bowe, Lauren Tabaksblat, Andrew T. Sutton and Kate E. Fisch of Brithem LLP. Pincus is represented by Matthew F. Davis, Bindu A. Palapura and Malisa C. Dang of Potter Anderson & Corroon LLP, and by Matthew S. Barr, David J. Lender, Jared R. Friedmann and Chase A. Bentley of Weil Gotshal & Manges LLP. Venezuela is represented by Donald B. Verrilli Jr., Elaine J. Goldenberg, Ginger D. Anders, George M. Garvey and Adeel Mohammadi of Munger Tolles & Olson LLP. PDVSA is represented by Joseph D. Pizzurro, Kevin A. Meehan, Juan O. Perla, Robert Groot and David V. Holmes of Curtis Mallet-Prevost Colt & Mosle LLP. Delaware counsel for Venezuela and PDVSA are Samuel Taylor Hirzel II and Brendan Patrick McDonnell of Heyman Enerio Gattuso & Hirzel LLP. PDV Holding and Citgo are represented by Susan W. Waesco and Alexandra M. Cumings of Morris Nichols Arsht & Tunnell LLP, and by Nathan P. Eimer, Daniel D. Birk and Gregory M. Schweizer of Eimer Stahl LLP. Crystallex is represented by Raymond J. DiCamillo, Jeffrey L. Moyer and Travis S. Hunter of Richards Layton & Finger PA, and by Robert L. Weigel, Jason W. Myatt, Rahim Moloo, Miguel A. Estrada, Lucas C. Townsend, Zachary Kady and Adam M. Smith of Gibson Dunn & Crutcher LLP. The case is Crystallex International Corp. v. Bolivarian Republic of Venezuela, case number 1:17-mc-00151, in the U.S. District Court for the District of Delaware.

Mar 3

5 min

On April 14, Willkie client Atlas Holdings and Olympus Partners announced the signing of a definitive agreement whereby Olympus will acquire a majority ownership stake in International Wire Group Holdings, Inc. (IWG). Under the terms of the agreement, Atlas will continue as an investor in the company. IWG is the largest non-vertically integrated copper and copper-alloy wire products manufacturer in the U.S. and maintains operations in Europe, all supported by global engineering capabilities. IWG’s broad product portfolio services a wide range of applications in energy, green electrification, industrial, automotive, aerospace, data communications and other major markets. Willkie previously advised Atlas in its acquisition of IWG in 2019. The Willkie team was led by partners Steven Seidman, Mark Cognetti and Laura Acker and included associates Brittany Klinger and David Araoz.

Apr 18

1 min

On December 19, it was announced that Willkie client iCON Infrastructure Partners VI, L.P., a fund advised by iCON Infrastructure LLP, entered into a partnership with Royal Caribbean Group to develop strategic cruise port infrastructure in support of Royal Caribbean Group's growth plans. The partnership will be owned 90% by iCON VI and 10% by Royal Caribbean Group. It will be managed by an independent management team with strategic support from Royal Caribbean Group. Both parties have committed to provide funding for future expansion in accordance with their percentage interest. At closing (anticipated for the first quarter of 2023), Royal Caribbean Group expects to receive net cash proceeds of approximately $210 million. The new partnership will initially include PortMiami Terminal A, and several development projects in Italy, Spain and the U.S. Virgin Islands. The partnership will also pursue additional port infrastructure developments based on the robust pipeline of projects as part of Royal Caribbean Group's destination development strategy. iCON VI, iCON’s latest flagship fund, closed fundraising in June 2022 with $3.6 billion of capital committed. iCON is a leading independent investment group focused on investing in high-quality infrastructure assets located predominantly in North America and Europe, with extensive experience investing in ports and port-related infrastructure. The Willkie team was led by partners Claire James, Russell Leaf and Gavin Gordon and included associates Brittany Klinger, Tyler Born and William Buchanan.

Dec 19

1 min

Retail landlord Simon Properties and luxury retailer Saks Global on Monday wrangled over the wording of a 2024 investment agreement as they asked a Texas bankruptcy judge to determine the fate of the leases of two Saks locations. Counsel for the parties made their closing arguments to U.S. Bankruptcy Judge Alfredo R. Perez after three days of hearings on Simon's request for a ruling that it can terminate the leases without the notice periods in the leases themselves. The parties are disputing whether a letter agreement Simon and Saks entered into when Simon invested $100 million in Saks in 2024 allows Simon to terminate the leases of a Saks location in Woodbury, New York, and a Neiman Marcus store in Palo Alto, California, effective Jan. 8, six days before Saks declared bankruptcy and a stay on contract terminations went into effect. Both parties acknowledged that the agreement granted Simon the right to terminate the Palo Alto lease and one other lease for "failure to perform" on either lease and that Saks had overdue lease payments, but they disagreed on whether the letter overrode notice of default and cure period provisions in the leases that would have given Saks 30 days from its Jan. 8 notice to make up the payments. At Monday's hearing, Simon counsel Robert Velevis argued the default provisions in the leases were not relevant, saying the agreement specifically allowed termination for "failure to perform" and not "default." "The letter agreement does not give a cure period," it said. Saks counsel Allyson Smith argued the letter agreement doesn't define "failure to perform" but the leases do, and that definition includes cure rights. The sole purpose of the clause in the letter agreement was to give Simon the right to terminate the leases for a default on a different lease, she argued. She also argued calling a default on the leases was a break with the parties' standard relationship. She said Simon had always accepted late payments, for example when Saks disputed a particular charge and delayed payment until the dispute was reconciled. "There has always been an amount technically outstanding," she said. Velevis argued this only meant that Simon had the right to terminate the leases anytime after the agreement was signed, and only invoked it now for "its own reasons." Smith claimed Simon learned of Saks' plans to file and "manufactured a default" in order to seize the leases and prevent Saks from selling them in its Chapter 11. Judge Perez reserved decisions on the issue. Simon Property Group is represented by Duston K. McFaul, Robert S. Velevis, Jeri Leigh Miller and Maegan Quejada of Sidley Austin LLP. Saks is represented by Kelli S. Norfleet, Kenric D. Kattner, Arsalan Muhammad, Kourtney P. Lyda and David Trausch of Haynes Boone and Debra M. Sinclair, Robin Spigel, Allyson B. Smith, Betsy L. Feldman, Jessica D. Graber, Jennifer J. Hardy, Ryan B. Bennett, Stuart R. Lombardi and Nathaniel G. Ward of Willkie Farr & Gallagher LLP. The case is In re: Saks Global Enterprises LLC et al., case number 4:26-bk-90103, in the U.S. Bankruptcy Court for the Southern District of Texas.

Mar 2

2 min