In the Matter of: ASARCO, L.L.C., Debtors, ASARCO, L.L.C.; ASARCO INCORPORATED; AMERICAS MINING CORPORATION, Appellants Cross-Appellees, v. BARCLAYS CAPITAL, INCORPORATED, Appellee Cross-Appellant.
No. 11-41010
United States Court of Appeals, Fifth Circuit
December 11, 2012
Appeals from the United States District Court for the Southern District of Texas
JENNIFER WALKER ELROD, Circuit Judge:
In this fee dispute, we are asked to determine whether the bankruptcy court erred in: (1) awarding a $975,000 fee enhancement to Barclays Capital, Inc. (“Barclays“) pursuant to
In August 2005, ASARCO, a mining company based in the United States and owned by Grupo Mexico S.A.B. de C.V., filed a voluntary Chapter 11 bankruptcy petition in the United States Bankruptcy Court for the Southern District of Texas. ASARCO‘s bankruptcy filing was precipitated by “a mounting labor crisis, billions of dollars in environmental and asbestos liability, and a decline in copper prices . . . .” ASARCO LLC v. Barclays Capital Inc. (In re ASARCO LLC), 457 B.R. 575, 578 (S.D. Tex. 2011) (ASARCO II).
Shortly after the petition date, ASARCO filed an application to retain Lehman Brothers (“Lehman“) as its financial advisor and investment banker during the course of the bankruptcy proceeding. In October 2005, the bankruptcy court approved ASARCO‘s application to retain Lehman pursuant to §§ 327(a) and 328(a) of the Bankruptcy Code. See
ASARCO‘s engagement letter with Lehman (“Engagement Letter“) provided that Lehman would perform the following services:
- Advise and assist [ASARCO] in formulating a plan of reorganization and/or analyzing any proposed plan, including assisting in the plan negotiation and confirmation process of a Restructuring Transaction under Chapter 11 of the Bankruptcy Code;
- In connection therewith, provide financial advice and assistance to [ASARCO] in structuring any new securities to be issued in a Restructuring Transaction;
- Participate in negotiations among [ASARCO] and its creditors, unions, suppliers, lessors and other interested parties relating to the Chapter 11 Case;
- Participate in hearings before the bankruptcy court with respect to the matters upon which Lehman Brothers has provided advice,
including, as relevant, coordinating with [ASARCO‘s] counsel with respect to testimony in connection therewith; - Provide expert witness testimony concerning any of the subjects encompassed by the other financial advisory services;
- Upon request, review and analyze any proposals [ASARCO] receives from third parties in connection with a Transaction, including, without limitation, any proposals for debtor-in-possession (“DIP“) financing and/or exit financing;
- Assist [ASARCO] in connection with [ASARCO‘s] liquidity analysis;
- Review and analyze [ASARCO‘s] business, operations, properties, financial condition and prospects and financial projections (including business plans provided by [ASARCO]);
- Evaluate [ASARCO‘s] debt capacity in light of its projected cash flows and assist in the determination of an appropriate capital structure for [ASARCO];
- Analyze various restructuring scenarios and the potential impact of these scenarios on the recoveries of those stakeholders impacted by any Transaction;
- Provide strategic advice with regard to restructuring or refinancing [ASARCO‘s] financial obligations;
- Assist in the drafting, preparation and distribution of selected information and other related documentation describing [ASARCO] and the terms of a potential transaction;
- Assist [ASARCO] in identifying, contacting and evaluating potential purchasers for any Sale Transaction; and
- Provide such other advisory services as are customarily provided in connection with the analysis and negotiation of a Restructuring Transaction or a Sale Transaction, as requested.
As compensation for the aforementioned services, ASARCO agreed to pay Lehman a $100,000 monthly advisory fee for the first 24 months of service and $75,000 per month thereafter until the end of Lehman‘s engagement. ASARCO also agreed to pay Lehman a $4 million transaction fee; however, 100% of the advisory fees paid during the first 24 months and 50% of the advisory fees paid thereafter would be credited towards the $4 million transaction fee.
In August 2007, and again in January 2008, ASARCO applied to the bankruptcy court for permission to expand the scope of Lehman‘s engagement and augment Lehman‘s compensation package. ASARCO stated that it had originally anticipated that Lehman‘s role in the bankruptcy proceeding would be limited and thus had negotiated the Engagement Letter with that limited role in mind. After Lehman was retained, however, ASARCO regularly asked Lehman to undertake additional (and, at times, critical) responsibilities that fell outside the scope of the Engagement Letter. ASARCO wanted to compensate Lehman for these additional services and to redefine the terms governing its retention of Lehman for the remaining months of its engagement. With regard to compensation, ASARCO sought to increase Lehman‘s monthly advisory fee retroactively to $150,000 for the period between April 2007 and September 2008. In addition, Lehman asked the bankruptcy court for authority to apply for “an additional discretionary fee based [on] the successful outcome” of ASARCO‘s bankruptcy. In its January 2008 application, ASARCO also requested
In May 2008, the bankruptcy court approved ASARCO‘s request to pay Lehman $1 million for services related to the fraudulent-transfer proceedings, but it declined to approve any of the other proposed revisions to the Engagement Letter. See In re ASARCO LLC, 2010 WL 4976937, at *3 (Bankr. S.D. Tex. Dec. 2, 2010) (ASARCO I). According to the bankruptcy court:
Lehman was bound by the terms of its original engagement but could, under § 328(a), apply for additional compensation after the conclusion of its employment if it could prove that its original terms and conditions were “improvident in light of developments not capable of being anticipated at the time of fixing of such terms and conditions.”
Id. (quoting
Less than four months later, in September 2008, Lehman‘s parent company, Lehman Brothers Holdings Inc., filed its own Chapter 11 bankruptcy petition, commencing the largest bankruptcy proceeding in United States history. And, a week after that, Barclays acquired Lehman‘s investment banking and financial advisory businesses.1
Barclays informed ASARCO that it was not willing to proceed under the terms of the Engagement Letter. ASARCO subsequently agreed to increase Barclays‘s compensation and, in late November 2008, the bankruptcy court approved the revised terms of Barclays‘s engagement2 (“Revised Engagement
In November 2009, the bankruptcy court approved the bankruptcy plan that was presented by Grupo Mexico, which provided for: (1) a 100% return to all of ASARCO‘s creditors; and (2) Grupo Mexico‘s reacquisition of ASARCO. The confirmed plan “result[ed] in one of the most successful bankruptcies in the United States in history.” ASARCO II, 457 B.R. at 580. The bankruptcy court praised Barclays for helping to make this outcome possible, remarking that “[d]uring its more than four years of intensive service Lehman and then Bar[clays] played a critical role in achieving the successful reorganization of [ASARCO].” ASARCO I, 2010 WL 4976937, at *13.
After the plan‘s confirmation, Barclays submitted a final fee application requesting, inter alia, (1) $1,202,500 for “unanticipated services“; (2) a $2 million success fee (“Success Fee“) based on the overall outcome of ASARCO‘s reorganization; and (3) a $6 million auction fee (“Auction Fee“) for Barclays‘s assistance in marketing and auctioning one of the bankruptcy estate‘s largest
The reorganized ASARCO appealed the bankruptcy court‘s award of $975,000 to Barclays, and Barclays appealed the bankruptcy court‘s denial of the Success Fee and Auction Fee. ASARCO II, 457 B.R. at 577–78. The district court affirmed all of the bankruptcy court‘s decisions. Id. at 594.
This appeal followed, in which ASARCO challenges the $975,000 fee award and Barclays contests the denial of its request for a $2 million success fee. Barclays has not challenged the denial of its request for a $6 million Auction Fee.
II.
In reviewing the rulings of the bankruptcy court, this court applies the same standards of review as applied by the district court. In re Scopac, 624 F.3d 274, 279–80 (5th Cir. 2010). We review the award of attorneys’ fees for abuse of discretion. In re Barron, 225 F.3d 583, 585 (5th Cir. 2000) (Barron I); see also In re Pilgrim‘s Pride Corp., 690 F.3d 650, 657–61 (5th Cir. 2012). In conducting this review, we analyze the legal conclusions that guided the awarding court‘s determinations de novo and that court‘s findings of fact for clear error. In re Coho Energy Inc., 395 F.3d 198, 204 (5th Cir. 2004); In re Consol. Bancshares, Inc., 785 F.2d 1249, 1252 (5th Cir. 1986). We also review mixed questions of law and fact de novo. In re Quinlivan, 434 F.3d 314, 318 (5th Cir. 2005).
The first issue we consider is whether the bankruptcy court erred in awarding $975,000 to Barclays pursuant to § 328(a) of the Bankruptcy Code. ASARCO contends that the court erred in so doing because the subsequent developments giving rise to the additional services provided by Barclays were not “incapable of anticipation,” which is a necessary prerequisite under § 328(a) for increasing such fees. Barclays counters that it provided numerous services that were both outside of the scope of the Revised Engagement Letter and “not capable of being anticipated” at the time the bankruptcy court approved Barclays‘s retention, justifying the $975,000 fee enhancement. As set forth below, we agree with ASARCO that the bankruptcy court erred in awarding the $975,000 fee enhancement.
A.
Before delving into the merits of this case, we deem it useful to consult § 328(a) of the Bankruptcy Code and our relevant case law interpreting it. Section 328(a) provides that:
The trustee, or a committee appointed under section 1102 of this title, with the court‘s approval, may employ or authorize the employment of a professional person under section 327 or 1103 of this title, as the case may be, on any reasonable terms and conditions of employment, including on a retainer, on an hourly basis, on a fixed or percentage fee basis, or on a contingent fee basis. Notwithstanding such terms and conditions, the court may allow compensation different from the compensation provided under such terms and conditions after the conclusion of such employment, if such terms and conditions prove to have been improvident in light of developments not capable of being anticipated at the time of the fixing of such terms and conditions.
We have repeatedly interpreted § 328(a) as meaning precisely what it says: A professional may be retained on any reasonable terms; but, once those terms
Section 328(a)‘s establishment of such a “high hurdle” was no accident. Congress enacted § 328(a) to eliminate the previous uncertainty associated with professional compensation in bankruptcy proceedings, even at the risk of potentially underpaying, or, conversely, providing a windfall to, professionals retained by the estate under § 328(a). Coho Energy, 395 F.3d at 204 (“When [the bankruptcy courts‘] fee discretion began to dissuade professionals from offering their services to debtors, Congress passed section 328(a) of the bankruptcy code, which allowed professionals to have greater certainty as to their eventual payment.“); see also Barron II, 325 F.3d at 695 (Jones, C.J., concurring) (referring to the attorney‘s fee as a “sizeable windfall” but agreeing that the attorney was entitled to receive it under § 328(a)); Smart World, 552 F.3d at 232 (“Where the court pre-approves the terms and conditions of the retention under section 328(a), its power to amend those terms is severely constrained.“); In re Nat‘l Gypsum Co., 123 F.3d 861, 862–63 (5th Cir. 1997) (“If the most competent professionals are to be available for complicated capital restructuring and the development of successful corporate reorganization, they must know what they will receive for their expertise and commitment. Courts must protect those agreements and expectations, once found to be acceptable.“).
Thus, consistent with § 328(a)‘s text and purpose, we have reversed a bankruptcy court‘s reduction of an attorney‘s contingency fee based on the
We reversed and reinstated the original contingency fee because: (1) the bankruptcy court had failed to explain specifically why the three subsequent developments were actually incapable of anticipation; and (2) the record indicated that the developments were foreseeable.5 Id. at 693–94. In so doing, we made clear that fee arrangements approved under § 328(a) may not be cast aside merely because the fee appears excessive in hindsight at the end of the case. Id. at 693–95; see also Smart World, 552 F.3d at 235 (“[T]he fact that contingency fees may appear excessive in retrospect is not a ground to reduce them because ‘early success by counsel is always a possibility capable of being
We have upheld a bankruptcy court‘s revision of a fee arrangement pursuant to § 328(a)‘s improvidence exception on only one occasion. See Coho Energy, 395 F.3d at 205. In Coho Energy, the debtor hired a law firm to represent it in a contract dispute. Id. at 200–01. The fee agreement, which was approved under § 328(a), provided that the attorneys would receive a 30% contingency fee, and that any disputes between that firm and the debtor would be resolved through arbitration. Id. at 201. The debtor subsequently terminated its relationship with that law firm and hired another to continue the litigation that had been commenced by the initial firm. Id. The successor law firm ultimately obtained an $8.5 million settlement in the debtor‘s favor. Id. Even though the new firm was successful in settling the contract dispute, the first firm initiated an arbitration proceeding against the debtor to recover its fees. Id. Not having been informed of the $8.5 million settlement, the arbitrator presumed that the litigation would settle for approximately $20 million and generate a $5.9 million contingency fee award for the original law firm.6 Id. at 201, 205. The bankruptcy court did not adhere to the arbitrator‘s findings, and instead awarded the original firm only $1,540,625 in legal fees. Id. at 202. We affirmed the bankruptcy court‘s decision, holding that:
One of the findings of the arbitration panel was that the full amount [the attorney] would be entitled to under the contract would be $5.9 million. This shows that the arbitration panel was operating on the assumption that the total settlement would be approximately $20 million. That the arbitration panel would be kept so ill-informed as
to use figures two and a half times in excess of the actual amount qualifies as an unanticipatable development . . . .
Id. at 205. Thus, Coho Energy teaches that § 328(a)‘s improvidence exception may be satisfied if: (1) the fee arrangement called for an adjudicatory body to resolve compensation disputes; and (2) that body‘s conclusions were premised on patently erroneous findings of fact.
Finally, it bears mention that the Bankruptcy Code does not require that, when setting their rate or means of payment at the commencement of an engagement, professionals select the rigid standards of § 328(a). To the contrary, professionals employed by the estate have the option of being compensated under either § 328(a) or § 330(a). Barron II, 325 F.3d at 692; In re Texas Sec., Inc., 218 F.3d 443, 445 (5th Cir. 2000); Nat‘l Gypsum, 123 F.3d at 862. “Section 328 applies when the bankruptcy court approves a particular rate or means of payment [at the outset of the engagement], and § 330 applies when the court does not do so.” Texas Sec., 218 F.3d at 445. Section 330(a) is a far more flexible provision, authorizing bankruptcy courts to award “reasonable compensation for actual, necessary services rendered by the . . . professional person . . . .”
B.
We now turn to the case at hand. The district court affirmed the bankruptcy court‘s $975,000 fee enhancement based on numerous developments that it concluded were incapable of anticipation. The first development involved the length of the ASARCO bankruptcy proceeding. ASARCO II, 457 B.R. at 582.
Since ASARCO was (and is) a non-public subsidiary of a foreign company, [Barclays] had no way of knowing that the Company had serious deficiencies in its internal management capabilities and reporting systems. Further, no one could have anticipated that the chief executive officer would be removed within one month or that the Board would be replaced twice within the first months of this case.
Id. (citation, internal quotation marks, and alterations omitted).
Second, in addition to the departures of the CEO and board of directors, ASARCO experienced a steady exodus of its salaried employees throughout 2005 and 2006. Id. at 582–83; see also ASARCO I, 2010 WL 4976937, at *5 (ASARCO was “losing personnel at an alarming rate“). The bankruptcy court found the scale of the employee exodus unusual, remarking that “although some management upheaval is to be expected in a Chapter 11 case, it would be difficult to forecast that a company with the size, complexity and history of ASARCO would lack depth of management to the extent of company [sic].” ASARCO I, 2010 WL 4976937, at *5. This prompted Barclays, at ASARCO‘s request, to develop an employee retention plan, a task that was specifically
The district court summarized other services performed by Barclays to help stabilize ASARCO, some that were outside the scope of the Engagement Letter and others that were not the kind traditionally performed by investment bankers, including the following:
[Barclays] worked to resolve ASARCO‘s liquidity crisis, a “service beyond the scope of a traditional investment banker.” To that end, it negotiated the terms of a debtor-in-possession financing facility (“DIP“) and worked to resolve operational crises caused by the ongoing labor strike, both of which were instrumental in avoiding a disadvantageous quick liquidation.
[Barclays] recruited new members to ASARCO‘s board of directors, and upon the board‘s request advised ASARCO‘s management on a daily basis on tasks that the debtor‘s management typically performs. This work included preparing “numerous reports analyzing budget and cash flow projections and certain metal purchase agreements,” and [Barclays] professionals were permanently on-site at the Debtor‘s Tucson offices.
. . .
[Barclays] filled ASARCO‘s management vacuum caused by the dismissal of ASARCO‘s CEO and the absence of a CFO. [Barclays] acted in place of a CFO and later assisted the new CFO in several tasks, such as creating reports for constituents, managing communications with financial advisors and creditors, and obtaining and analyzing financial information.
[Barclays] led searches for a new CEO and contacted Joseph Lapinsky, whose work as CEO was of enormous benefit to ASARCO. [Barclays] also worked to retain for ASARCO the management consulting firm of Alvarez & Marsal.
[Barclays] designed and implemented a copper hedging program, “unique for a chapter 11 debtor outside of the ordinary course of the debtor‘s business,” and expended many hours achieving a consensus regarding the hedging program among ASARCO‘s many creditors.
Id. (quoting ASARCO I, 2010 WL 4976937, at *4–7).
Under this deferential standard, this Court affirms the Bankruptcy Court‘s determination that [Barclays‘s] arrangement was improvident and incapable of anticipation when it was made. There is ample evidence in the record to support the Bankruptcy Court‘s conclusions that the length and complexity of the bankruptcy were incapable of anticipation when [Barclays] entered into the engagement letter. . . . Evidence also supports the finding that [Barclays] performed many services outside the scope of its original agreement, the need for which was incapable of anticipation when the agreement was made. This Court finds that the Bankruptcy Court‘s finding that Bar[clays] deserved $975,000 to make up for [Barclays‘s] services was supported by the record and not clearly erroneous; therefore, the Court affirms the award of $975,000 to Bar[clays].
Id. at 585 (emphasis added).
C.
It is true that appellate courts must review the facts on which a fee award is based for clear error. See Quinlivan, 434 F.3d at 318. In the context of a § 328(a) award, however, clear error is not the appropriate standard for reviewing a conclusion that the facts (i.e., the subsequent developments) were “not capable of being anticipated.” See
We reverse the bankruptcy court because none of the facts on which the $975,000 enhancement is based satisfy § 328(a)‘s improvidence exception. The bankruptcy court‘s analysis focused on the notion that, given ASARCO‘s status as a non-public subsidiary of a foreign corporation, Barclays did not know—and was incapable of discovering—how dysfunctional ASARCO truly was at the time that it agreed to the terms of the Engagement Letter. The bankruptcy court also relied heavily on the fact that many of ASARCO‘s executives, directors, and salaried employees had jumped ship during the pendency of the bankruptcy case, resulting in a significant vacuum of leadership and management. The additional services performed by Barclays were aimed at reducing ASARCO‘s dysfunction and filling the gaps created by those who had left. Although these efforts were commendable, we conclude that the developments giving rise to the need for Barclays‘s additional services were capable of being anticipated and, therefore, fail to satisfy § 328(a)‘s improvidence exception.
Barclays contends, in essence, that when it agreed to the terms of the Engagement Letter, it anticipated that ASARCO would be making a quick stop in Chapter 11. To analogize, Barclays apparently thought that it had a dusty, yet functional, Corvette on its hands. Although it needed a little polish, this Corvette was poised for a speedy trip into and out of Chapter 11 with the help of an experienced driver, i.e., Barclays. Once in the driver‘s seat, however,
Here, the record indicates that, much like the dusty Corvette, ASARCO was coated in, at the very least, a substantial layer of dust when Barclays agreed to the terms of the Engagement Letter. At that time, a union was on strike and “no end to the strike was in sight.” ASARCO I, 2010 WL 4976937, at *4. In the words of the bankruptcy court, the strike made it “impossible to predict when [ASARCO‘s] employees would return to their jobs and allow [ASARCO] to resume normal operations.” Id. (emphasis added). Further, Barclays was well aware that ASARCO‘s bankruptcy filing had been precipitated by, in addition to the labor crisis, “billions of dollars in environmental and asbestos liability, and a decline in copper prices.” ASARCO II, 457 B.R. at 578. Thus, Barclays was capable of anticipating that its plans for a quick pit-stop reorganization could be slowed by the problems of which it was aware, like the labor strike, as well as other foreseeable problems—such as inadequate leadership, management, internal controls, and reporting systems—that it had not yet discovered. See Home Express, 213 B.R. at 165 (explaining that surprises are common in Chapter 11 proceedings).
We are also unpersuaded by Barclays‘s proffered excuse that it had no way of knowing—and, therefore, could not have anticipated—the full extent of ASARCO‘s internal disarray because ASARCO was a non-public subsidiary that did not share confidential information prior to Barclays‘s retention. Barclays‘s
Likewise, we find no merit in Barclays‘s contention that the employee exodus was incapable of anticipation. The bankruptcy court acknowledged that “some management upheaval is to be expected in a chapter 11 case” but then concluded that “it would be difficult to forecast that a company with the size, complexity, and history of ASARCO” would have such a steady loss of salaried employees. ASARCO I, 2010 WL 4976937, at *5 (emphasis added). We conclude that, although the parties might not have expected such an extraordinary employee exodus, they could have anticipated that executives, board members, and salaried employees would depart the company after it filed a Chapter 11 petition. See Michelle M. Harner, The Corporate Governance and Public Policy Implications of Activist Distressed Debt Investing, 77 FORDHAM L. REV. 703, 759 n.352 (2008) (“Management turnover in connection with a Chapter 11 case is not a new development.“); Lynn M. LoPucki & William C. Whitford, Corporate Governance in the Bankruptcy Reorganization of Large, Publicly Held Companies, 141 U. PA. L. REV. 669, 723–38 (1993) (discussing empirical research indicating that turnover among chief executive officers is common during the pendency of Chapter 11 proceedings). The fact that the number of personnel departures was above average, or even extraordinary, does not transform a foreseeable development into one that is incapable of anticipation. Cf. Nucentrix, 314 B.R. at 580 (“While no party, even including this Court, expected the auction process would be so successful, the success of the auction was capable of being anticipated.“).
In sum, we conclude that all of the subsequent developments in the ASARCO bankruptcy proceeding were “capable of being anticipated” within the meaning of § 328(a). Accordingly, the bankruptcy court erred in awarding Barclays a $975,000 fee enhancement based on § 328(a).
IV.
The second issue presented in this case is whether the bankruptcy court erred in denying the $2 million Success Fee sought by Barclays. Although we find no reversible error, we remand to the district court with instructions to remand to the bankruptcy court for it to consider whether a Success Fee is
A.
Barclays first contends that the bankruptcy court “erred by not applying
Paragraph 6(f) of the Revised Engagement Letter authorized Barclays:
to apply to the court for final approval of an additional discretionary fee based upon the successful outcome of the Chapter 11 case. This fee shall be based upon a variety of factors including but not limited to quality of service, creativity of advice, and comparable market rates, all of which should be evaluated by the most objective standard available.
ASARCO I, 2010 WL 4976937, at *10.
Without addressing § 330(a)(3), the bankruptcy court denied Barclays‘s request for the discretionary Success Fee because it found that it had already awarded Barclays sufficient compensation:
There is no dispute that these Chapter 11 Cases were a remarkable success. Moreover, Bar[clays‘] advice, commitment, and undertaking of a variety of tasks, including those that are typically
not performed by investment bankers, provided benefits to the estate. Indeed, both this Court and the District Court recognized the benefits conferred upon the estate by Bar[clays]. The contract rate plus the additional [$975,000 in] fees awarded herein provide Bar[clays] with reasonable compensation for the services performed at a market rate. Therefore, taking into consideration the nonexclusive factors set out in the Bar[clays] engagement letter, the Court finds that no additional compensation is warranted.
Id. at *11.
We conclude that the bankruptcy court did not err in declining to consult the factors listed in § 330(a)(3). Nothing in Paragraph 6(f) required the bankruptcy court to consult § 330(a)(3) and, more importantly, the Revised Engagement Letter explicitly disclaims consideration of that provision. Paragraph 11 of the Revised Engagement Letter provides that Barclays‘s retention would be “subject to the standard of review provided for in Section 328(a) of the Bankruptcy Code, and not subject to any other standard of review under section 330 of the Bankruptcy Code.” We adhere to the parties’ wishes as expressed in the Revised Engagement Letter.
Further, Barclays‘s reliance on Texas Securities is misplaced. There, we were asked to determine whether an attorney‘s employment was “governed by
In disputes governed by § 328(a), the contractual arrangement is supreme, and we shall enforce the contract as written. See Nat‘l Gypsum, 123 F.3d at 862 (“Courts must protect those [§ 328(a)] agreements and expectations, once found to be acceptable.“); cf. In re Citation Corp., 493 F.3d 1319, 1319 (11th Cir. 2007) (explaining that it is appropriate for the court to recognize that the employment contract “was a product of free and equal bargaining by sophisticated, knowledgeable parties” when considering whether to adjust a fee pre-approved under § 328). If Barclays wanted the Success Fee to be evaluated in light of the factors found in § 330(a)(3), it should have provided for such review expressly in the Revised Engagement Letter. Because the Revised Engagement Letter is devoid of any such mandate, the bankruptcy court did not err in declining to address § 330(a)(3).15
B.
Barclays next contends that the bankruptcy court incorrectly focused on Paragraph 6(f)‘s “comparable market rates” factor and failed to consider the other factors listed in that paragraph when declining to award the Success Fee. We disagree. The bankruptcy court‘s opinion stated that it considered “the nonexclusive factors set out in the” Revised Engagement Letter. See ASARCO I, 2010 WL 4976937, at *11. Accordingly, Barclays‘s claim to the contrary is without merit.
Finally, Barclays argues that the bankruptcy court “made a clearly erroneous factual finding that Bar[clays] had received market rate [compensation] when both parties’ evidence showed to the contrary.” Our review of the record leaves us with the definite and firm conviction that no such error occurred. See Quinlivan, 434 F.3d at 318. Accordingly, we reject Barclays‘s contention that the bankruptcy court clearly erred in finding that Barclays was compensated at market rate.
V.
For the foregoing reasons, we REVERSE the $975,000 fee enhancement award and we REMAND to the district court for further proceedings consistent with this opinion.
JENNIFER WALKER ELROD
UNITED STATES CIRCUIT JUDGE
Notes
In determining the amount of reasonable compensation to be awarded to an
examiner, trustee under chapter 11, or professional person, the court shall consider the nature, the extent, and the value of such services, taking into account all relevant factors, including—- the time spent on such services;
- the rates charged for such services;
- whether the services were necessary to the administration of, or beneficial at the time at which the service was rendered toward the completion of, a case under this title;
- whether the services were performed within a reasonable amount of time commensurate with the complexity, importance, and nature of the problem, issue, or task addressed;
- with respect to a professional person, whether the person is board certified or otherwise has demonstrated skill and experience in the bankruptcy field; and
- whether the compensation is reasonable based on the customary compensation charged by comparably skilled practitioners in cases other than cases under this title.
(1) The time and labor required; (2) The novelty and difficulty of the questions; (3) The skill requisite to perform the legal service properly; (4) The preclusion of other employment by the attorney due to acceptance of the case; (5) The customary fee; (6) Whether the fee is fixed or contingent; (7) Time limitations imposed by the client or other circumstances; (8) The amount involved and the results obtained; (9) The experience, reputation, and ability of the attorneys; (10) The “undesirability” of the case; (11) The nature and length of the professional relationship with the client; (12) Awards in similar cases.
Pilgrim‘s Pride, 690 F.3d at 654 (quoting Johnson, 488 F.2d at 717–19).