Linux Containers Authors: Liz McMillan, Yeshim Deniz, Elizabeth White, Pat Romanski, Stackify Blog


Efficiently Winding Down a Complex Legal Business

A Case Study of The Aldridge Company’s Work for the Trustee in the Howrey Law Firm Bankruptcy

In 2011, the partners of Howrey LLP voted to dissolve the firm, which had expanded to become one of the largest antitrust and intellectual property practices in the world with more than 700 lawyers in 17 offices in the U.S., Europe and Asia. Faced with the monumental challenge of cost-effectively winding down the firm’s complicated IT infrastructure, the bankruptcy trustee turned to The Aldridge Company.

Jason Rudd, a partner with Diamond McCarthy LLP, calls it “an octopus.” He’s referring to the information technology (IT) systems of Howrey LLP, the once thriving law firm that dissolved in 2011 and entered chapter 11 bankruptcy. Diamond McCarthy is serving as trustee’s counsel and is guiding the orderly wind-down of the firm’s operations.

As in every bankruptcy case, the trustee in the Howrey bankruptcy, Allan Diamond, has focused on investigating the bankruptcy estate, gathering assets and converting the assets to cash to pay claims. The goal is to recover as much for the creditors as possible. Additionally, Diamond sought to preserve client data while he notified all former clients of the firm’s liquidation to provide clients the opportunity to retrieve their files.

The Howrey case involved approximately 10,000 former clients. As the trustee quickly realized, one of the biggest obstacles to an orderly and cost-efficient wind-down was Howrey’s complicated IT systems.

With a chief information officer who doubled as the firm’s executive director of operations and an IT staff that, at its peak, employed more than 90 people, Howrey had taken great pride in being perceived as a leader in legal technology. One news release stated, “To maintain its leadership position, Howrey has consistently placed a strong focus on the strategic use of technology to improve efficiencies.”

However, the firm’s many customized IT solutions and 300 physical servers with 200 terabytes of data operating out of hosted datacenters in Virginia and The Netherlands apparently failed to provide an early warning as cash flow sputtered.

In fact, Howrey’s IT department was still scaling up as the vultures were circling.

“It was jaw-dropping – that was my first reaction,” said Rudd. “They had the IT infrastructure for a firm with thousands of people but only a couple dozen were left. We were on a very limited budget as we began working to unravel this beast and we found out that just keeping the IT system operating was churning through $200,000 every month. We knew right away that we needed expert guidance to get the firm’s IT under control and shrink it.”

For many reasons, just flipping the switch and turning off Howrey’s IT systems was not an option. For instance, the trustee was investigating outstanding accounts receivable, which required access to billing and time-keeping data. An investigation was also underway into the circumstances that led to the dissolution of the firm to explore potential liability, which required access to e-mail and other records. Moreover, much of the firm’s data is the property of its former clients and is protected by attorney-client privilege, necessitating preservation and special handling.

The Washington Post described the challenge this way:

“Winding down a law firm’s data cache is especially complicated because virtually everything in it is owned by clients who have to be tracked down and contacted, whereas in bankruptcies involving other types of businesses, most of the data stored over the company’s life span is owned by the company itself. And because information retained by law firms is protected under attorney-client privilege, the estate must be particularly careful about returning or destroying the files so no one other than the client can access them.”

“We specialize in bankruptcy and insolvency situations and other forms of liquidations, but this one was unusually complicated because of the complexity of the systems, the amount of information, the sensitivity of much of the information, and the limitations imposed in terms of budget and timeline,” Rudd said. “In a lot of ways it was similar to our work on healthcare matters because Howrey’s client data required the same degree of sensitivity as patient records do.”

In January 2012, the trustee secured approval from the creditors committee to engage The Aldridge Company to develop and implement a plan to wind down Howrey’s IT systems while maintaining access to data and preserving client files. The Aldridge Company team quickly concluded that institutional memory would be essential and worked closely with the Howrey IT staffer who had remained to assist with the wind-down.

“Over the years, Howrey had developed customized solutions that would have taken us too much time to learn, so having that internal expertise was invaluable,” said Patrick Wiley, Chief Operating Officer with The Aldridge Company. “We started by separating the firm into its business units and approaching one application at a time. We asked ‘do we need it?’ If yes, ‘How do we shrink it?’ If no, ‘How do we preserve it?’”

Application-by-application The Aldridge Company facilitated the preservation of all data that might be needed, then they pulled the plug on anything not essential for the investigation or accounts receivable.

“We needed to be able to dissect the data without harming it and then shrink it down without losing data integrity,” Wiley said.

The Aldridge Company’s detailed analysis found that Howrey’s systems held approximately 200 terabytes of data and it all needed to be preserved for certain periods of time. They moved the firm’s U.S. servers to The Aldridge Company’s Managed Services data center in Houston, Texas. Due to concerns about European privacy laws, moving foreign client data to U.S. servers was not an option, so Aldridge used the Amazon cloud (Amazon Elastic Compute Cloud and Amazon Simple Storage Service) based in Europe to achieve their efficiency goals.

Between January 2012 and March 2012, The Aldridge Company shrunk Howrey’s hosted data center environment of 300 physical servers down to four physical servers running only 30 virtual servers on Howrey’s private cloud managed by The Aldridge Company.

“The Aldridge Company was extremely autonomous and we appreciated that Patrick and his team always came to the table with a solution – never just a problem,” said Rudd. “They were great communicators throughout the process. They constantly updated us and offered great advice, but perhaps most important in a situation like this that is prone to change, The Aldridge Company was flexible.”

The strategies implemented by The Aldridge Company successfully reduced the operational costs of Howrey’s IT systems from over $200,000 per month to $12,000 per month. The firm’s data was available for the ongoing investigation, but was significantly shrunk. Client data was preserved.

“The key in any bankruptcy is to maximize the value for all stakeholders by getting the most out of assets and minimizing costs,” said Rudd. “The Aldridge Company has been instrumental in making that possible.”

About The Aldridge Company
The Aldridge Company is a Houston, Texas-based technology management, consulting and outsourcing company. Founded in 1984, the company brings a winning combination of professional technical expertise, extensive capabilities and a strict focus on the importance of business processes. The Aldridge Company is a leading provider, consultant and integrator of information technology and cloud computing solutions. In 2011, the company was listed as No. 11 on the Houston Business Journal’s Fast Tech 50 list of fastest growing Houston technology companies.

The Aldridge Company provides enterprise-level management of servers, PCs, and networks, coupled with rapid and accurate technical support. In addition, it operates and manages data center facilities offering fully-redundant, secure hosting of servers that cross the spectrum of business disciplines. By offering a broad range of IT solutions in one organization, The Aldridge Company allows clients to benefit from having a single point of contact for the entire IT environment.

For more information about The Aldridge Company and how it can help transform your IT management and services, visit www.aldridge.com or call (832) 209-2940.

More Stories By Daniel Keeney

Dan Keeney is the president of DPK Public Relations, which represents PULSE, The Aldridge Company, Schipul - The Web Marketing Company, Society for Heart Attack Prevention and Eradication, ERHC Energy, Saint Arnold Brewing Company, Arocha Hair Restoration among other companies. Specialties include helping organizations increase their positive visibility and establish and strengthen relationships with influencers in their markets.

@ThingsExpo Stories
Business professionals no longer wonder if they'll migrate to the cloud; it's now a matter of when. The cloud environment has proved to be a major force in transitioning to an agile business model that enables quick decisions and fast implementation that solidify customer relationships. And when the cloud is combined with the power of cognitive computing, it drives innovation and transformation that achieves astounding competitive advantage.
The Founder of NostaLab and a member of the Google Health Advisory Board, John is a unique combination of strategic thinker, marketer and entrepreneur. His career was built on the "science of advertising" combining strategy, creativity and marketing for industry-leading results. Combined with his ability to communicate complicated scientific concepts in a way that consumers and scientists alike can appreciate, John is a sought-after speaker for conferences on the forefront of healthcare science,...
Data is the fuel that drives the machine learning algorithmic engines and ultimately provides the business value. In his session at Cloud Expo, Ed Featherston, a director and senior enterprise architect at Collaborative Consulting, discussed the key considerations around quality, volume, timeliness, and pedigree that must be dealt with in order to properly fuel that engine.
Explosive growth in connected devices. Enormous amounts of data for collection and analysis. Critical use of data for split-second decision making and actionable information. All three are factors in making the Internet of Things a reality. Yet, any one factor would have an IT organization pondering its infrastructure strategy. How should your organization enhance its IT framework to enable an Internet of Things implementation? In his session at @ThingsExpo, James Kirkland, Red Hat's Chief Archi...
The current age of digital transformation means that IT organizations must adapt their toolset to cover all digital experiences, beyond just the end users’. Today’s businesses can no longer focus solely on the digital interactions they manage with employees or customers; they must now contend with non-traditional factors. Whether it's the power of brand to make or break a company, the need to monitor across all locations 24/7, or the ability to proactively resolve issues, companies must adapt to...
In his keynote at 18th Cloud Expo, Andrew Keys, Co-Founder of ConsenSys Enterprise, provided an overview of the evolution of the Internet and the Database and the future of their combination – the Blockchain. Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life settl...
Organizations planning enterprise data center consolidation and modernization projects are faced with a challenging, costly reality. Requirements to deploy modern, cloud-native applications simultaneously with traditional client/server applications are almost impossible to achieve with hardware-centric enterprise infrastructure. Compute and network infrastructure are fast moving down a software-defined path, but storage has been a laggard. Until now.
In his general session at 19th Cloud Expo, Manish Dixit, VP of Product and Engineering at Dice, discussed how Dice leverages data insights and tools to help both tech professionals and recruiters better understand how skills relate to each other and which skills are in high demand using interactive visualizations and salary indicator tools to maximize earning potential. Manish Dixit is VP of Product and Engineering at Dice. As the leader of the Product, Engineering and Data Sciences team at D...
DXWorldEXPO LLC announced today that the upcoming DXWorldEXPO | CloudEXPO New York event will feature 10 companies from Poland to participate at the "Poland Digital Transformation Pavilion" on November 12-13, 2018.
Digital Transformation is much more than a buzzword. The radical shift to digital mechanisms for almost every process is evident across all industries and verticals. This is often especially true in financial services, where the legacy environment is many times unable to keep up with the rapidly shifting demands of the consumer. The constant pressure to provide complete, omnichannel delivery of customer-facing solutions to meet both regulatory and customer demands is putting enormous pressure on...
The best way to leverage your CloudEXPO | DXWorldEXPO presence as a sponsor and exhibitor is to plan your news announcements around our events. The press covering CloudEXPO | DXWorldEXPO will have access to these releases and will amplify your news announcements. More than two dozen Cloud companies either set deals at our shows or have announced their mergers and acquisitions at CloudEXPO. Product announcements during our show provide your company with the most reach through our targeted audienc...
JETRO showcased Japan Digital Transformation Pavilion at SYS-CON's 21st International Cloud Expo® at the Santa Clara Convention Center in Santa Clara, CA. The Japan External Trade Organization (JETRO) is a non-profit organization that provides business support services to companies expanding to Japan. With the support of JETRO's dedicated staff, clients can incorporate their business; receive visa, immigration, and HR support; find dedicated office space; identify local government subsidies; get...
DXWorldEXPO LLC announced today that All in Mobile, a mobile app development company from Poland, will exhibit at the 22nd International CloudEXPO | DXWorldEXPO. All In Mobile is a mobile app development company from Poland. Since 2014, they maintain passion for developing mobile applications for enterprises and startups worldwide.
@DevOpsSummit at Cloud Expo, taking place November 12-13 in New York City, NY, is co-located with 22nd international CloudEXPO | first international DXWorldEXPO and will feature technical sessions from a rock star conference faculty and the leading industry players in the world.
"Akvelon is a software development company and we also provide consultancy services to folks who are looking to scale or accelerate their engineering roadmaps," explained Jeremiah Mothersell, Marketing Manager at Akvelon, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
As data explodes in quantity, importance and from new sources, the need for managing and protecting data residing across physical, virtual, and cloud environments grow with it. Managing data includes protecting it, indexing and classifying it for true, long-term management, compliance and E-Discovery. Commvault can ensure this with a single pane of glass solution – whether in a private cloud, a Service Provider delivered public cloud or a hybrid cloud environment – across the heterogeneous enter...
DXWorldEXPO LLC announced today that ICC-USA, a computer systems integrator and server manufacturing company focused on developing products and product appliances, will exhibit at the 22nd International CloudEXPO | DXWorldEXPO. DXWordEXPO New York 2018, colocated with CloudEXPO New York 2018 will be held November 11-13, 2018, in New York City. ICC is a computer systems integrator and server manufacturing company focused on developing products and product appliances to meet a wide range of ...
More and more brands have jumped on the IoT bandwagon. We have an excess of wearables – activity trackers, smartwatches, smart glasses and sneakers, and more that track seemingly endless datapoints. However, most consumers have no idea what “IoT” means. Creating more wearables that track data shouldn't be the aim of brands; delivering meaningful, tangible relevance to their users should be. We're in a period in which the IoT pendulum is still swinging. Initially, it swung toward "smart for smart...
Headquartered in Plainsboro, NJ, Synametrics Technologies has provided IT professionals and computer systems developers since 1997. Based on the success of their initial product offerings (WinSQL and DeltaCopy), the company continues to create and hone innovative products that help its customers get more from their computer applications, databases and infrastructure. To date, over one million users around the world have chosen Synametrics solutions to help power their accelerated business or per...
Dion Hinchcliffe is an internationally recognized digital expert, bestselling book author, frequent keynote speaker, analyst, futurist, and transformation expert based in Washington, DC. He is currently Chief Strategy Officer at the industry-leading digital strategy and online community solutions firm, 7Summits.