If Chrysler LLC's brief ride through bankruptcy is any indication, Judge Robert E. Gerber has his hands full presiding over the much larger and complex Chapter 11 filing of General Motors Corp. But the veteran judge certainly has the pedigree to handle what some expect to be a contested case.
Before GM, Gerber's most notable assignment was that of telecommunications giant Adelphia Communications Corp.--a case in which his ultimate ruling was appealed to a higher court. In confirming Adelphia's Chapter 11 plan in January 2007, Gerber called the 4-1/2-year case "among the most challenging -- and contentious -- in bankruptcy history."
And that was before a group of Adelphia bondholders successfully petitioned the U.S. District Court for the Southern District of New York to stay Gerber's confirmation order pending an appeal, arguing that they were denied due process in voting on the plan.
District Court Judge Shira A. Scheindlin temporarily granted the stay, but whether Gerber erred in confirming Adelphia's plan was never decided. The noteholders refused to post a $250 million bond, causing Scheindlin to vacate the stay order.
Gerber, 62, was appointed to the U.S. Bankruptcy Court for the Southern District of New York in Manhattan in 2000 after a 30-year career at Fried, Frank, Harris, Shriver & Jacobson LLP. He received a bachelor's degree from Rutgers University in 1967 and a law degree from Columbia University in 1970.
As a judge, he has presided over bankruptcies including Global Crossing Ltd., Lyondell Chemical Co., Levitz Furniture Inc., Berry-Hill Galleries Inc. and Daewoo International (America) Corp.
"He really knows how to control the courtroom," says Jay Indyke, a partner at New York firm Cooley Godward Kronish LLP, who represented the official committee of unsecured creditors in the Levitz bankruptcy. "What he does -- which I think is very effective -- he comes on the bench and he's clearly read all the papers, no matter how late they've been filed. He tells the attorneys in the room exactly what issues are a concern to him and sets the tone for the hearing."
Gerber's control of the courtroom was on full display during GM's first trip to court on June 1 as he threatened to cut off all of the attorneys participating by teleconference when one lawyer cracked a joke during GM's request to pay certain employee wages.
While presenting the motion, a Weil, Gotshal & Manges LLP attorney told the court that if an interim order was entered, the U.S. trustee would review all corporate expenses over $2,500 and that no executives would fly first class. When the unnamed attorney asked whether that included private jets, Gerber quickly interjected with a terse response.
"Is someone cracking jokes during a pretty important hearing?" the judge asked. "This is serious to a lot of people's lives, and I would have thought that people understand that."
Indyke says one of Gerber's strengths is that "he tends to not let everyone talk," meaning, for example, if there are 50 landlords in a bankruptcy case with substantially the same minor objections, Gerber typically tells them to elect one lawyer to speak at the hearing to save time.
Such an approach will certainly help during the GM bankruptcy, where hundreds of attorneys promise to pack Gerber's courtroom and two overflow rooms, ready to bill through the night.
