U.S. bankruptcy Judge David Jones in Houston has resigned after a federal appeals court opened an ethics probe spurred by a previously undisclosed romantic relationship with an attorney whose firm had cases before his court, ending his tenure as the busiest bankruptcy judge in the U.S.
Jones resigned, with effect from November 15, according to Reuters’ interview with Southern District of Texas Chief U.S. District Judge Randy Crane on Sunday. Large bankruptcy cases that Jones had been overseeing had already been handed off to two other judges on the court.
Requests for comment were not immediately answered by Jones or his deputy in the courtroom.
The 5th U.S. Circuit Court of Appeals, which has its headquarters in New Orleans, filed a formal misconduct complaint against Jones on Friday after the judge disclosed he had a long-term love affair and lived together with bankruptcy lawyer Elizabeth Freeman. Freeman had been a partner at Jackson Walker, a neighbourhood law office that frequently filed cases in Jones’ Houston courthouse, until December 2022.
The 5th Circuit alleged that Jones had concealed details of his personal life from two other judges who were in charge of a motion to have him removed from a case involving the insolvent energy business McDermott International.
According to ethics experts, the secret relationship calls into question the fairness of Jones’ court. The misconduct accusation could result in similar difficulties in other instances involving Freeman or Jackson Walker. Tehum Care Services, a bankrupt subsidiary of prison healthcare provider Corizon, has already been the subject of a call for further review as a result of the misconduct charge.
Jackson Walker refuted any notion that their work may be subject to further examination, but he would not comment on the departure. “Ms. Freeman was forbidden from working on or billing for any matters before Judge Jones as soon as we learned of this claim, according to our instructions. In a statement, the company stated, “We are sure that we behaved responsibly.
Requests for comment from Freeman did not immediately receive a response.
In light of fresh concerns about the “propriety” of Jones’ involvement in the case, the office of the U.S. Trustee, which acts as the Department of Justice’s bankruptcy inspector, stated on Friday that Tehum’s restructure should not be allowed. During bankruptcy proceedings, in which Freeman also participated, Jones acted as the mediator.
According to information from Debtwire, a company that conducts research and intelligence on the credit markets, Jones has been the most busy bankruptcy judge in the U.S. since January 2016, preside over 11% of all Chapter 11 bankruptcies involving more than $100 million in liabilities.
