HomeMy WebLinkAboutResolution 4073-03-2012A Resolution
NO. 4074 -03 -2012
RATIFYING AND APPROVING THE RETENTION OF PETER C.
LEWIS AND THE LAW FIRM OF SCHEEF & STONE, L.L.P. AS
OUTSIDE LEGAL COUNSEL TO REPRESENT THE CITY IN
MATTERS RELATED TO THE AMR BANKRUPTCY
WHEREAS, American Airlines, Inc. has certain facilities and maintenance agreements related
to its operations at Dallas/Fort Worth International Airport ( "DFW "), which is jointly owned by the City
of Fort Worth (the "City ") and the City of Dallas; and
WHEREAS, Alliance Airport Authority, Inc. (the "Corporation ") owns the American Airlines
maintenance facility adjacent to Fort Worth Alliance Airport and issued bonds to finance construction of
that facility (the "Alliance Maintenance Facility ") and certain equipment located therein; and
WHEREAS, the Corporation is a nonprofit industrial development corporation created pursuant
to the Development Corporation Act of 1979, as amended, exclusively for the purpose of benefiting and
accomplishing public purposes of, and to act on behalf of, the City; and
WHEREAS, the City accordingly has interests concerning both DFW and the Alliance
Maintenance Facility that may be affected by the bankruptcy of American Airlines, Inc. and American
Airlines Inc.'s parent company, AMR Corporation (collectively, the "AMR Bankruptcy "); and
WHEREAS, because the interests that may be affected by the AMR Bankruptcy are of
extraordinary importance and involve complex litigation, it is necessary to retain outside legal counsel to
represent the City in such matters; and
WHEREAS, Peter C. Lewis is an attorney with extensive bankruptcy law experience and is
well - qualified to represent the City in such matters; and
WHEREAS, DFW administration has represented that it will cover the legal expenses incurred
by the City in matters related to the AMR Bankruptcy to the extent that such services concern the City's
interests at DFW; and
WHEREAS, in accordance with the Corporation's stated purpose, it is proper for the
Corporation to pay any legal fees that the City may incur in matters related to the AMR Bankruptcy to
the extent that such services concern the Alliance Maintenance Facility;
No. 4074 -03 -2012
WHEREAS, it is expected that the Corporation's board of directors, by separate resolution of
the Corporation, will ratify and authorize Mr. Lewis and the law firm of Scheef & Stone, L.L.P. to
represent the Corporation in matters concerning the AMR Bankruptcy and will also approve payment of
any related legal fees incurred by the City to the extent that such services concern the Maintenance
Facility (the "Corporation Resolution ");
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF FORT WORTH, TEXAS:
1. THAT the City hereby ratifies and approves the retention of Peter C. Lewis and the law
firm of Scheef & Stone, L.L.P. as outside legal counsel to represent the Corporation in
matters related to the AMR Bankruptcy;
2. THAT payment of any legal fees to Peter C. Lewis and the law firm of Scheef & Stone,
L.L.P. for legal services provided to the City in matters related to the AMR Bankruptcy
shall be made by the DFW administration to the extent that such services concern the
City's interests at DFW;
3. THAT payment of any legal fees to Peter C. Lewis and the law firm of Scheef & Stone,
L.L.P. for legal services provided to the City in matters related to the AMR Bankruptcy
shall be made by the Corporation to the extent that such services concern the City's
interests in the Alliance Maintenance Facility;
4. THAT in accordance with the Resolution that the Corporation's board of directors is
expected to adopt, the compensation to be paid to Peter C. Lewis and the law firm of
Scheef & Stone, L.L.P. for representation of both the Corporation and, to the extent that
such representation concerns the Maintenance Facility, shall not, as far as practicable,
exceed $50,000.00 in the aggregate;
5. THAT this Resolution shall take effect as of both (i) its adoption by the City Council
and (ii) adoption of the Corporation Resolution by the board of directors of the
Corporation.
ADOPTED this 20th day of March, 2012.
ATTEST:
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Mary J. Kayser, Cify Mecretary
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City of Fort Worth, Texas
Mayor and Council Communication
COUNCIL ACTION: Approved on 3/20/2012 - Resolution No. 4074 -03 -2012
DATE: Tuesday, March 20, 2012 REFERENCE NO.: G -17547
LOG NAME: 12AMR BANKRUPTCY OUTSIDE COUNSEL PETER LEWIS
SUBJECT:
Adopt Resolution Ratifying and Approving the Retention of Outside Legal Counsel to Represent the City in
Matters Related to the AMR Bankruptcy (ALL COUNCIL DISTRICTS)
RECOMMENDATION:
It is recommended that the City Council adopt the attached Resolution ratifying and approving the
retention of Peter C. Lewis and the law firm of Scheef & Stone, L.L.P. as outside legal counsel to
represent the City in matters related to the AMR bankruptcy.
DISCUSSION:
On November 29, 2011 AMR Corporation (AMR), American Airlines, Inc. (American), and AMR Eagle
Holding Corporation, and certain of their subsidiaries, filed Chapter 11 bankruptcy petitions in the United
States Bankruptcy Court, Southern District of New York (collectively, the AMR Bankruptcy).
American has certain facilities and maintenance Agreements related to its operations at Dallas /Fort Worth
International Airport (DFW) and at its maintenance facility adjacent to Alliance Airport (the Alliance
Maintenance Facility). The City jointly owns DFW with the City of Dallas. The Alliance Maintenance
Facility is owned by Alliance Airport Authority, Inc. (the Authority), an industrial development corporation
created exclusively to benefit and act on behalf of the City for the promotion and development of new and
expanded business enterprises and employment. The Alliance Maintenance Facility is leased to
American.
The City Attorney has decided that, because of the extraordinary importance of the AMR Bankruptcy, it is
necessary to retain outside legal counsel with significant knowledge and experience in corporate
bankruptcy matters to ensure that the City's interests are protected. Peter C. Lewis is well- recognized for
his knowledge and expertise in bankruptcy and has agreed to represent the City in this matter. Mr. Lewis
will employ Deily, Mooney & Glastetter, LLP, to represent the City in the Southern District of New York, the
venue for the AMR Bankruptcy.
DFW administration has represented that it will pay legal fees incurred by the City in matters related to the
AMR Bankruptcy to the extent that such services concern the City's interests at DFW. At a meeting of the
Authority's board of directors on March 20, 2012 immediately following the City Council meeting, it is
expected that the Authority's board of directors will adopt a resolution that authorizes the retention of Mr.
Lewis to represent the Authority in matters related to the AMR Bankruptcy and, in accordance with the
Authority's purpose, that also authorizes payment of any legal fees incurred by the City in protecting its
interests in the Alliance Maintenance Facility (the Authority Resolution). Legal fees for representation of
the Authority as well as the City's interests in the Alliance Maintenance Facility are, as far as practicable,
not expected to exceed $50,000.00 in the aggregate.
Although payment of these legal fees will not come from City funds, Chapter VI, Section 3 of the City
Logname: I2AMR BANKRUPTCY OUTSIDE COUNSEL PETER LEWIS Page I of 2
Charter requires the City Council to approve the retention of any outside legal counsel for assistance to
the City Attorney. Accordingly, it is recommended that the City Council adopt the attached Resolution for
retention of Peter C. Lewis and the law firm of Scheef & Stone, L.L.P. to represent the City in matters
related to the AMR Bankruptcy, with the understanding that the effectiveness of this Resolution is
contingent on adoption of the Authority Resolution by the Authority's board of directors.
This action will benefit ALL COUNCIL DISTRICTS.
FISCAL INFORMATION / CERTIFICATION:
The Financial Management Services Director certifies that this action will have no material effect on City
Funds.
FUND CENTERS:
TO Fund /Account /Centers
CERTIFICATIONS:
Submitted for City Manager's Office by:
Originating Department Head:
Additional Information Contact:
FROM Fund /Account/Centers
Fernando Costa (6122)
Sarah Fullenwider (7623)
Christopher Mosley (7603)
Logname: 12AMR BANKRUPTCY OUTSIDE COUNSEL PETER LEWIS Page 2 of 2