Federal Judge's Romance Scandal Ends with $15 Million Settlement

The long-running legal saga born of a bankruptcy judge’s secret romance with a Biglaw partner may finally be winding down… for the price of $15 million. For those just tuning in: David R. Jones, the (now former) federal bankruptcy judge for the Southern District of Texas, was romantically involved with Elizabeth Freeman, the (now former) bankruptcy partner at Jackson Walker, and continued to hear cases involving Freeman and her firm without recusing or disclosing the relationship. That ethical lapse cost Jones his seat on the bench and kicked off years of litigation that has been equal parts legal ethics seminar and daytime soap opera. ( The texts alone — “We are keeping this down loooooooowww” — could carry a season.) The U.S. Trustee, the Justice Department’s bankruptcy watchdog, sued Jackson Walker back in November 2023, aiming to vacate the orders that approved the firm’s retention and fees, and to disgorge up to $23 million the firm collected in cases connected to Jones and Freeman. After the parties couldn’t reach a deal in mediation and the matter headed toward trial , the firm has now agreed (according to a settlement term sheet filed Sunday in the U.S. Bankruptcy Court for the Southern District of Texas) to pay $15 million to make it all go away. A conversation with Trustpoint.One CEO Christopher Gallagher.