- GOP to Obama: Take your ‘golf cap off’ and get down to coal country
- Hamas cleric tells Jews: ‘We will exterminate you’
- San Diego Costco, Target shoppers shocked by plane crash in parking lot
- George W. Bush penning biography of father
- Israel vows to destroy Hamas tunnels
- Spain evacuates staff from embassy in Libya
- Peace Corps evacuates over Ebola fears; 2 volunteers isolated
- House overwhelmingly approves $16 billion cash infusion for VA overhaul
- Obama admin to blame for HealthCare.gov woes, $840M cost: GAO
- Al Gore’s climate-changers at EPA hearings foiled by cool temperatures
Foreign bids called critical to A123 sale
Lawyers shepherded deal with Chinese firm
Question of the Day
The prospect of Massachusetts-based high-tech battery-maker A123 Systems landing in the hands of a Chinese competitor has angered some lawmakers, but a group of highly paid lawyers — including a former Senate staffer who earned more than $1,000 per-hour — kept the sale from falling apart amid mounting criticism on Capitol Hill.
By law, officials with the Treasury Department led Committee on Foreign Investment in the United States (CFIUS) — which approved the $257 million deal this week — aren’t allowed to discuss their decisions on approving such sales.
But new billing records submitted in A123’s bankruptcy case offer a window into a process that is typically shielded from public view.
The federal government’s approval of the A123 deal came about only after “extensive discussion and negotiation” with a little-known but powerful panel charged with reviewing the sale, lawyers involved in the talks said in recent court papers.
In addition, the U.S. Department of State’s Directorate of Defense Trade Controls conducted a parallel national security review of the proposed A123 sale to Wanxiang America Corp., the Chicago arm of China’s biggest auto parts manufacturer, according to records.
Lawyers from the Skadden Arps law firm, which served as special counsel in the A123 bankruptcy case, disclosed the reviews in legal bills that the firm submitted to the U.S. Bankruptcy Court in Delaware this week.
A123 went bankrupt last year despite receiving about half of the nearly quarter billion grant it won from the Obama administration to operate factories in Michigan. While a bankruptcy judge approved Wanxiang’s winning bid for most of A123’s assets, the deal still required approval from the federal government. Wanxiang announced it had been cleared to move ahead with the sale this week, but several Republicans weren’t happy.
“Technology produced by A123 and funded by U.S. taxpayers should not simply be shipped off to China so that the military applications for these materials can be reproduced abroad,” Sen. Chuck Grassley, Iowa Republican, said Tuesday, reacting to news that the federal government had approved the sale.
The Department of Energy, which awarded the federal grant money to A123, declined to comment on the sale. But a spokesman said the federal grant paid for “brick and mortar” construction of advanced battery manufacturing facilities in Michigan.
In its fee application to the bankruptcy court, the law firm said its lawyers helped A123 identify its “most sensitive assets and business operations,” structuring the sale to Wanxiang in a way that would address concerns of both government panels reviewing the sale.
“This structuring process involved extensive input from and negotiations with” both with the Treasury-led CFIUS and the State Department directorate.
In explaining its bill, which totaled about $300,000, the firm said foreign bids for A123 were “critically important” to the company’s efforts to maximize its value and that, indeed, the highest bid for most of the company’s assets came from the subsidiary of Wanxiang.
Two partners from the firm worked on the case, along with other lawyers, associates and staff, with rates ranging from $310 per hour to $1,090 per hour for partner Ivan A. Schlager, a former Senate staffer.
© Copyright 2014 The Washington Times, LLC. Click here for reprint permission.
About the Author
Jim McElhatton is an investigative reporter for The Washington Times. He can be reached at firstname.lastname@example.org.
- Patent workers paid to exercise, shop, do chores: report
- Power outage at Tennessee VA reveals safety risks for patients, staff
- House federal records plan would prevent repeat of IRS email scandal
- Whistleblowers flood VA with lawsuits despite apology
- Outrage over $190M deal for troubled federal contractor USIS
Latest Blog Entries
TWT Video Picks
By Ted Cruz
Israel saves its enemies; Hamas endangers its friends
- Geraldo Rivera: Matt Drudge 'doing his best to stir up a civil war'
- Al Gore's climate-changers at EPA hearings foiled by cool temperatures
- Chicken pox outbreak puts illegal immigrant facility on lockdown
- EDITORIAL: The real Lois Lerner exposed in newly released emails
- NAPOLITANO: Is the president incompetent or lawless?
- House votes to sue President Obama over claims of presidential power
- 'Big Bang' star Mayim Bialik helps send bulletproof vests to IDF
- Lois Lerner hated conservatives, new emails show
- Star witness in Bob McDonnell corruption trial refutes 'crush' defense
- CRUZ: A tale of two hospitals: One in Israel, one in Gaza
Obama's biggest White House 'fails'
Celebrities turned politicians
Athletes turned actors
20 gadgets that changed the world