Orianna Health Systems – Omega Entities Objects to DLA Piper Fees, Arguing That Work on Flawed, Un-confirmable Plan Should Never Have Occurred

October 18, 2018 – OHI Asset RO and certain affiliates (the “Omega Entities”) filed an objection [Docket No. 1095] to the interim fee request of DLA Piper (US) as set forth in the fifth monthly application for allowance of compensation for services rendered and for reimbursement of expenses as counsel [Docket No. 1025]. The objection asserts, “The July Monthly Statement seeks $878,955.50 in fees and $42,142.42 in expenses….Following the Debtors’ admission of a flawed understanding of their plan of reorganization (originally filed at Docket No. 21), the Court concluded that the Plan has at all times been un-confirmable given the Debtors’ financial state….The Omega Entities submit that payment of any further fees pertaining to the Debtors’ Plan should not and cannot take place. To submit a plan based on either a misreading of its clear provisions, or based on a failed understanding of the Debtors’ finances (or both), runs afoul of section 330(a)(3)(C)….At a minimum, the Omega Entities respectfully submit that the payment of any amounts in this category is inappropriate at this time and not in conformity with sections 330(a)(3)(C) and (D) or the applicable Johnson Factors, based on this Court’s ruling that the Plan’s plain language renders it un-confirmable….In addition, in a separate category of “Court Hearings,” the July Monthly Statement seeks $72,285.50 in fees for court hearings and related preparation in connection with the Plan and Disclosure Statement….Finally, in a separate category of ‘Litigation and Contested Matters,’ the July Monthly Statement seeks $352,453.50 in fees. In addition, the July Monthly Statement seeks $72,285.50 in fees incurred for ‘Court Hearings.’ All of this time, save approximately $20,000 that was spent on the Committee’s motion to enforce its alleged settlement with the Omega Entities, related to the extensive litigation the Debtors had to undertake based on their mis-reading of the Plan.”