The fee cut represents about a 25 percent reduction from the $6 million or so Capstone had initially sought.Ĭhapman’s decision also carried implications for Manzo, law firm Kaye Scholer and Black Diamond itself, as well as the U.S. Still, Capstone ran afoul of disclosure requirements under bankruptcy law by failing to reveal the relationship, Chapman said. However, Chapman said the relationship itself, and the associated fee-sharing arrangements between Capstone and Manzo, did not violate bankruptcy rules, a blow to Black Diamond, which had accused Manzo of gross negligence. Judge Shelley Chapman said Capstone should have disclosed that Robert Manzo, the restructuring expert who helped sell and liquidate GSC’s assets, was working as a contractor rather than a direct employee of Capstone. Bankruptcy Court in Manhattan, brings to a close a nearly year-long saga over how bankruptcy professionals handled GSC’s insolvency and eventual sale to Black Diamond Capital Management. NEW YORK, Dec 16 (Reuters) - A judge cut the fees of financial adviser Capstone Advisory Group by about $1.57 million on Monday for its work on the bankruptcy of GSC Group Inc, saying it withheld information about a relationship with one of its contractors.
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