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LACBA Eyes Bankruptcy Reorganization
By a MetNews Staff Writer
The Los Angeles County Bar Association advised its members by email on Friday that the organization will declare bankruptcy if it can’t reach a settlement with the lessor of two floors of office space in the building at the northeast corner of Seventh and Bixel streets near downtown.
LACBA has not been paying rent since March and, Executive Director Stanley Bissey said Wednesday, “LACBA currently owes $1,122,880 in unpaid rent.”
Signaling that it would seek restructuring under Chapter 11, rather than a winding up of its affairs under Chapter 7, Friday’s email declares:
“For years, LACBA has been working diligently to control its operational costs. With the exception of its long-term commercial lease at 1055 West Seventh Street, Los Angeles, those efforts have been largely successful. For some time now, LACBA has been trying to renegotiate its lease with its landlord. Negotiations with the landlord continue. If those negotiations do not reach a satisfactory outcome in the near future, however, LACBA, like many enterprises and organizations in 2020, is exploring a possible strategic restructuring of its debt to shed itself of the lease burden.”
‘Business As Usual’
The email continues:
“You can rest assured that if this potential restructuring should be implemented, LACBA would continue to operate in a ‘business as usual’ manner. LACBA will continue to be your voice on matters of interest to the profession, and be your go-to source for high quality, low-cost CLE. LACBA will continue to provide virtual events with thought leaders and members of judiciary leading programming. LACBA will continue to work with Presiding Judge Kevin C. Brazile and Assistant Presiding Judge Eric C. Taylor to communicate information about their orders relating to court operations.
“LACBA’s Sections, Committees, Counsel for Justice, Lawyer Referral Service (SmartLaw), Attorney-Client Mediation and Arbitration Services, and the indigent defense programs would continue uninterrupted. In short, virtually every aspect of LACBA as you know it will continue to operate as usual, and we will continue to serve our members to the best of our ability.”
‘Transparency’ Pledged
The email adds:
“LACBA will also continue to be transparent with our members, and we have determined that at this time, in this climate, all options must be on the table for our association. A strategic restructuring, if necessary, will allow LACBA to address head-on many issues that will clear the way for a brighter future. We thank you for your membership and will continue to update our members as necessary.”
LACBA’s financial plight is generally seen as the result of two factors:
•The pandemic, which bars programs with live, in-person attendance;
•Misjudgment by former Chief Executive Officer Sally Suchil in waiving LACBA’s annual prerogative of getting out of the lease in exchange for concessions of minimal value. Suchil’s departure as CEO was a primary goal of a LACBA reform movement which was formed in 2015 and won offices in a 2016 election.
Suchil resigned in 2016, but with a lucrative golden-handshake arranged by then-President Margaret Stevens.
Copyright 2020, Metropolitan News Company