Jui Chakravorty and David Bailey
Sunday, Feb 7, 2009
The US government has retained two law firms with extensive bankruptcy experience and the investment bank Rothschild to advise officials on the taxpayer-backed restructuring of General Motors and Chrysler, a person with direct knowledge of the work said.
New York law firm Cadwalader, Wickersham & Taft LLP was hired by the US Treasury last month and will consider a range of possibilities for the struggling automakers including the prospect of a bankruptcy funded by the US government, the person said.
Cadwalader is joined by Chicago-based law firm Sonnenschein, Nath & Rosenthal and Rothschild in working with US officials as they prepare to review turnaround plans being readied by the two struggling automakers, the person said.
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A spokeswoman for Sonnenschein in Los Angeles confirmed that the firm had been engaged to advise Treasury on ”ongoing matters related to the 2008-2009 developments within the US automobile industry.”
The lawyers from Sonnenschein who are advising the US government are from the firm’s capital markets practice based in New York, the spokeswoman, Melissa Anderson, said.
Representatives for Rothschild, GM, Chrysler and the US Treasury could not be immediately reached for comment. Cadwalader had no comment.
GM and Chrysler executives have previously ruled out a bankruptcy filing, saying that it would quickly spin out of control into a liquidation because buyers would be scared away from purchasing new cars and trucks from a bankrupt automaker.
This article was posted: Sunday, February 8, 2009 at 5:34 am