Kenneth N. Russak

Representative Engagements

Real Estate Insolvencies

• Represented commercial finance affiliate of national bank in connection with a defaulted $90,000,000 portfolio of loans secured by "telecom hotels" located in San Francisco, Las Vegas and Boston.
• Represented life insurance company as the holder of a $50,000,000 senior secured loan in the Chapter 11 bankruptcy case of a luxury hotel.
• Represented national bank as the $90,000,000 senior secured lender in the chapter 11 case of a residential developer.
• Represented pension fund advisor as the subordinated secured construction lender in the chapter 11 bankruptcy case of a Reno master pad developer.
• Represented national bank as the holder of a $20,000,000 secured loan in the chapter 11 bankruptcy case of a master pad developer in a Mello-Roos bond district.
• Represented national bank as senior secured lender under a $90,000,000 portfolio of loans secured by 18 golf courses located in six different states in the South East and Mid-Atlantic regions, including coordination of multi-state receivership litigation and documentation of restructuring agreement, with bankruptcy remote and reverse ring-fencing structures.
• Represented national bank in the resolution of a $35,000,000 portfolio of loans secured by in excess of 16 golf courses located in five different states.
• Represented regional bank as senior secured lender in chapter 11 cases of a developer of luxury single family residences.
• Represented national bank as senior secured lender in the pre-bankruptcy planning, loan enforcement and refinancing of a $144,000,000 loan secured by a regional shopping mall located in St. Louis, Missouri.
• Represented commercial finance affiliate of nation bank as the senior secured lender in the workout of a defaulted portfolio of $25,000,000 in loans secured by 12 golf courses located in several southern and mid-western states. Negotiated and closed sale of courses in a turn-key operational transition in lieu of foreclosure.
• Representation of foreign bank regarding defaulted $25MM construction loan for mixed use commercial/residential structure in Los Angeles.

Corporate Insolvencies

• Represented national bank as the senior secured lender in the chapter 11 bankruptcy case of a roller bearing manufacturer located in New York.
• Represented regional bank as a secured lender in the workout of a loan to defense subcontractor.
• Second chair representation of national bank in chapter 11 bankruptcy of the House of Fabrics
• Representation of Wells Fargo Bank in connection with defaulted loan to charter airline company.
• Agent of bank group in the extra-judicial workout of a failed $140,000,000.00 leveraged buy-out of a mail presorting service provider.
• Representation of Bayerische Vereinsbank AG as senior secured lender in chapter 11 cases of entertainment conglomerate.

Litigation

• Defense of lender liability lawsuit brought against national bank affiliate by borrower's general contractor (telecom hotel conversion loan). Settled favorably after grant of motion for partial summary adjudication resulted in a dismissal of all claims for punitive damages.
• Defense of pharmacy benefits management company in claims asserted by receivers appointed for failed HMO affiliates in Texas, Oklahoma and Louisiana alleging multi-million dollar overcharging violations under PBM services agreement.
• Defense of pharmacy benefits management company in Indiana state court proceedings and in California bankruptcy court proceedings concerning management of pharmacy benefits services contract. Negotiated multi-party global settlement agreements, with California debtor, Indiana department of Insurance, pharmacies and replacement carriers on favorable terms.
• Lead trial and appellate counsel in the California state court judicial foreclosure lawsuit, fair value hearing and appeal from $4,000,000 deficiency judgment in favor of the Los Angeles agency of an Australian bank. Participated in the trial in Sydney, Australia of a lawsuit subsequently filed by the judgment debtors against that bank to collaterally attack under Australian law the judgment obtained in California. Judgments affirmed in the California appellate proceedings and in the Australian action.
• Defended regional bank in lender liability claim by investor in film financed by bank. Settled on favorable terms.
• Prosecuted and settled on favorable terms a post-confirmation dispute as to the amount of interest due on national bank's Original Issue Discount claim following Ninth Circuit's ruling affirming the general validity of the claim.
• Assisted in the representation of a post-confirmation creditors trust in the prosecution of an action seeking to set aside a $225,000,000 leveraged management buyout of neutraceutical distribution company. Action pending.
• Defended regional bank in arbitration commenced by money center bank seeking a refund of a wire transfer after discovery that the check funding the wire transfer was drawn on a zero balance account. Arbitration dismissed without cost to client.

Fraud/Embezzlement Cases

• Represented the US subsidiary of a Japanese meat packing company as the victim of a $100,000,000.00 embezzlement scheme in federal bank fraud, wire fraud and money laundering claims as both a potential suspect and as the victim and in ancillary federal receivership and civil forfeiture proceedings, as well as a plaintiff in lawsuits against recipients of the embezzled funds to recover same, including the $3.5 Million verdict at trial against Madam Tina, "The South Bay Psychic."
• Represented regional bank in lawsuits against jewelry manufacturers and insurance companies to recover losses resulting from theft of gold leased by Imperial to jewelry manufacturers who participated in or were victims of organized thefts of the gold from the manufacturing facilities.

Governmental Entity Credit Risk Analyses

• California Energy Crisis Counseling. Analyzed and advised power generation client concerning governmental credit risk issues relating to long-term, multi-billion dollar energy contracts executed during the midst of California's energy crisis.
• California Budget Crisis Counseling. Advised client re multi-billion dollar credit risk issues arising from contractual arrangement with State of California.

Reported Decisions

• Union Bank v. Wolas, 502 U.S. 151, 112 S.Ct. 527, 116 L.Ed.2d 514 (U.S. Sup.Ct. 1991) (ordinary course of business exception is available to under-secured lender as well as to trade creditors).
• In re Marin Town Center, 142 B.R. 374 (N.D. Cal. 1992) (for Resolution Trust Corporation as amicus curiae) (rights under relief from stay stipulation are assignable).
• CASC Corporation v. Milner (In re Locke), 180 B.R. 245, (Bkrtcy. C.D. Cal. 1995) (rejection of lease under 11 U.S.C. § 365 does not constitute an annulment of the lease).
• In re General Bearing Corp., 136 B.R. 361 (Bkrtcy. S.D.N.Y 1992) (test for sale free and clear of liens not satisfied).

Publications, Speaking Engagements, Press Mentions, Community and Professional Activities

• Panelist, A Practical Guide to the Bankruptcy Code, presented by the Special Assets Management Association, November, 2010.
• Guest Lecturer, University of San Diego, Business Law I and Business Law II (undergraduate seminar on the history and policies of US Bankruptcy Law), November, 2010.
• "Section 363 Real Estate Sales are Still Feasible after Clear Channel," Los Angeles Lawyer Magazine, March 2009.
• Honored as a "Southern California Super Lawyer" in the February 2009, 2008 and 2007 listings of "Super Lawyers" in Los Angeles Magazine and the Southern California Super Lawyers Magazine.
• Panelist, Workout Transactions in Today's Economic Environment panel of the Global Distressed Debt West Coast Investor Forum, presented by Finance IQ, a division of IQPC, March 2008.
• Moderator and/or Panelist, Distressed & Bankrupt Mezzanine Loans & The Workout Strategies panel of the Borrowers' and Investors' Forum on Real Estate Mezzanine Loans, presented by the Information Management Network: April 2008 (Century City), December 2006 (New York), December 2005 (New York) May 2005 (Century City), December 2004 (New York), May 2004 (Century City).
• The Next Downturn Really Will Be Different: How Private Fund Players and New Debt Structures Will Change the Dynamics of Future Workouts, The Orange County Risk Management Association, September 2005.
• CEB Panelist, Foreclosure of Mixed Collateral: New Issues in Multiple Security Transactions and Enforcement" presented in January 1995.
• Panelist, Real Estate Insolvencies, Wharton Club of Southern California, 1993.
• Panelist, Workout Session, The New Economy: Successful Real Estate Strategies for the '90s, 1992 USC Real Estate Tax and Accounting Conference.
• Program chair and lecturer, Real Estate Bankruptcies, 1992 USC Real Estate Alumni and Friends.
• Embezzler Comes Clean: Executive Reveals How He Took At Least $85 Million, Los Angeles Daily News, March 30, 1997.
• Judge Orders Psychic to Surrender $3 Million Embezzled by Executive, Los Angeles Times, November 20, 1998.
• Past member of the Executive Committee of the Pre- and Post-Judgment enforcement of Remedies Section of the Los Angeles County Bar Association.
• Amherst College Fundraising Committee, 2004.
• Five Acres Home for Boys and Girls, Finance Committee, pro bono legal services provided.