Meagen E. Leary

San Francisco

Business Reorganization & Financial Restructuring

Meagen E. Leary is co-chair of Duane Morris LLP's business reorganization and financial restructuring practice group, the first woman to hold that role in the firm. She joined Duane Morris in 2009. In 2022, she was elevated to serve on the firm's executive committee. Her national practice covers creditors' rights, commercial real estate finance and bankruptcy.

Leary's career swerved into the bankruptcy and restructuring world when the Great Recession of 2008 came around.

"I was doing general commercial litigation, but there were more and more distress-related cases, so I was thrown into it," she said. "It was a great learning experience."

That background prepared her for the current uncertain economic climate. "Now we see a lot of financial stress. As 2024 and 2025 come along, a lot of debt is coming due with interest rates rising. You see more desperation. Commercial real estate firms know that if the markets don't ease up, there's a potential for more bankruptcies and more restructurings in and out of court."

Bankruptcy laws can be controversial. "Companies try to use it to cleanse themselves of liability," Leary said, pointing to Johnson & Johnson's effort to resolve its talc case liabilities in bankruptcy and the temporary block placed by the Supreme Court over the Sackler family's attempted shield from civil liability via the Purdue Pharma bankruptcy plan.

"Those situations raise a lot of objections and questions in the bankruptcy community and now the Supreme Court has joined the chorus," Leary said.

In a recent case, Leary represented a secured creditor and loan servicer faced by borrowers -- a group of 32 tenants in common -- who owed more than $30 million on an office building and sought to escape into Chapter 11. She's keeping the client's name confidential, but she said, "This case had it all: out-of-court attempts at restructuring, state court litigation and bankruptcy court litigation."

It's something she sees a lot of. "The existing debt is on much more favorable terms, lower rates, than what you can get now. So, the borrower alleges the lender did something wrong to try to extend the loan terms. My job is to push back."

She did so successfully, eventually converting to a Chapter 7 plan where the property was liquidated and the negative claims extinguished. "Then we got all of the borrowers' attorney fees disgorged as a sanction. Sometimes, the good guys win."

--John Roemer