A group of eight former lawyers with Testa, Hurwitz & Thibeault on Thursday filed to take their former employer into involuntary Chapter 11 bankruptcy, an unusual move that could complicate the firm’s plans to liquidate.
The Chapter 11 petition, filed Feb. 17 in the U.S. Bankruptcy Court for the Eastern District of Massachusetts, seeks to compel Testa Hurwitz to undertake its liquidation under court supervision, according to court papers.
Boston-based Testa Hurwitz, formerly a 287-lawyer firm known for its expertise in advising technology and growth companies, voted on Jan. 14 to disband in a surprise move that jolted the close-knit technology world in the Boston area.
The move to disband was prompted by an exodus of lawyers to competitors starting last year, which complicated efforts to find a merger partner for the firm, a firm spokesman said.
The former Testa Hurwitz lawyers have individual claims against the firm ranging up to $500,000, according to court filings. All had left the firm in the last few years, with the most recent leaving last September.
The petitioners’ lawyer, John Monaghan of Holland & Knight, said his clients were concerned that their claims wouldn’t be paid in Testa Hurwitz’ private liquidation process, prompting them to file to force the firm into an involuntary Chapter 11.
“Rather than have the wind-down behind closed doors, my clients wanted the open air of the bankruptcy court,” said Monaghan. “They wanted the transparency and safety of the federal bankruptcy court