HTML Document View

Full title: Application for Final Compensation and/or Reimbursement of Expenses Pursuant to Sec. 330 for Chipman Brown Cicero & Cole, LLP as Special Counsel (Fee: $122,000.00, Expense: $45,803.98) filed by Attorney William E Chipman on behalf of Jr, Special Counsel Chipman Brown Cicero & Cole, LLP. (Attachments: (1) Exhibit A (2) Exhibit B (3) Exhibit C (4) Proposed Form of Order (5) Certificate of Service) (Chipman, William) (Entered: 11/13/2020)

Document posted on Nov 12, 2020 in the bankruptcy, 13 pages and 0 tables.

Bankrupt11 Summary (Automatically Generated)

This is CBCC’s final contingency fee application request (the “Application”) for compensation and reimbursement of out-of-pocket expenses related to the Andretti Action and Warrantech Actions (each as defined below) pursuant to section 105(a) and 331 of title 11 of the United States Code (the “Bankruptcy Code”), Rule B-2014-14(b)(4) of the Local Rules for the United States Bankruptcy Court for the Southern District of Indiana (the “Local Rules”), and the (i)On February 27, 2018, the Court entered that certain Order Approving Agreed Entry Regarding the Committee’s Retention and Employment of Chipman Brown Cicero & Cole, LLP to Pursue Certain Claims Against the Debtors’ Directors and Officers [Docket No. 2309] (“CBCC Retention Order”). Furthermore, the Retention Orders provide that CBCC shall be compensated for its services in accordance with and pursuant to the procedures set forth in the Bankruptcy Code, the Bankruptcy Rules, the Local Rules, the U.S. Trustee Guidelines and any other applicable orders of this Court; provided, however, that with respect to the final fee application, the fee structure set forth in the engagement letters shall be subject to review pursuant to the standard of review set forth in section 328 of the Bankruptcy Code and shall not be subject to the standard of review set forth in section 330 of the Bankruptcy Code, except solely by the Office of the U.S. Trustee for the Southern District of Indiana, which, for the avoidance of doubt, shall be entitled to review the final fee application for payment of compensation and reimbursement of expenses of CBCC under section 330 of the Bankruptcy Code.The defendant in the Warrantech Avoidance Action was Warrantech Consumer Product Services, Inc. dba Warrantech CPS, Inc. (“Warrantech”).By this Application, CBCC seeks final allowance and immediate payment of its contingency fee from the proceeds of the settlement payments for professional services rendered in the amount of $122,000.00 for the agreed upon fee as counsel to the Committee in each of the Actions and in accordance with the terms of the Retention Orders.

List of Tables

Document Contents

IN THE UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF INDIANA INDIANAPOLIS DIVISION
Table 1 on page 1. Back to List of Tables
In re:
hhgregg, Inc., et al.,1
Debtors.
Chapter 11
Case No. 17-01302-RLM-11
(Jointly Administered)
COVER SHEET TO THE FINAL FEE APPLICATION OF CHIPMAN BROWN CICERO & COLE, LLP, AS SPECIAL COUNSEL FOR THE OFFICIAL COMMITTEE OF UNSECURED CREDITORS FOR ALLOWANCE OF COMPENSATION AND REIMBURSEMENT OF EXPENSES FOR SERVICES RENDERED DECEMBER 27, 2017 THROUGH OCTOBER 29, 2020 RELATED TO CERTAIN CLAIMS Chipman Brown Cicero & Cole, LL Name of Applicant: (“CBCC” Authorized to Provide Professional Services to: Official Committee of Unsecured CreditorPetition Date: March 6, 201 Retention Date: December 27, 201 Period for Which Compensation and Reimbursement is Sought: December 27, 2017 through October 29, 202Amount of Compensation Sought as Actual, Reasonable and Necessary: $122,000.0 Amount of Expense Reimbursement Sought as Actual, Reasonable and Necessary: $45,803.9 This is Chipman Brown’s final fee application for the Andretti Action and the Warrantech Actions.

1

Prior Applications:
Table 1 on page 2. Back to List of Tables
None REQUESTED None APPROVED None
DATE FILED PERIOD
COVERED
FEES EXPENSES FEES EXPENSES
02.19.2019
[Docket No.
2999]
07.18.2018-
01.31.2020
$0.00 $40,097.67 $0.00 $40,097.67
TOTAL
APPROVED
EXPENSES
$40,097.67
Expenses Not
Previously
Billed
$5,706.31
TOTAL
FINAL
EXPENSES
$45,803.98

2

IN THE UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF INDIANA INDIANAPOLIS DIVISION
Table 1 on page 3. Back to List of Tables
In re:
hhgregg, Inc., et al.,1
Debtors.
Chapter 11
Case No. 17-01302-RLM-11
(Jointly Administered)
FINAL FEE APPLICATION OF CHIPMAN BROWN CICERO & COLE, LLP, AS SPECIAL COUNSEL FOR THE OFFICIAL COMMITTEE OF UNSECURED CREDITORS FOR ALLOWANCE OF COMPENSATION AND REIMBURSEMENT OF EXPENSES FOR SERVICES RENDERED DECEMBER 27, 2017 THROUGH OCTOBER 29, 2020 RELATED TO THE CERTAIN CLAIMS Chipman Brown Cicero & Cole, LLP (“CBCC”), Special Counsel for the Official Committee of Unsecured Creditors (the “Committee”) of hhgregg, Inc., et al. (collectively, the “Debtors”), respectfully represents as follows: INTRODUCTION 1. This is CBCC’s final contingency fee application request (the “Application”) for compensation and reimbursement of out-of-pocket expenses related to the Andretti Action and Warrantech Actions (each as defined below) pursuant to section 105(a) and 331 of title 11 of the United States Code (the “Bankruptcy Code”), Rule B-2014-14(b)(4) of the Local Rules for the United States Bankruptcy Court for the Southern District of Indiana (the “Local Rules”), and the (i) Agreed Entry Regarding the Committee’s Retention and Employment of Chipman Brown Cicero & Cole, LLP to Pursue Certain Claims Against the Debtors’ Directors and Officers [Docket No. 2301] (the “Agreed Entry”); and (ii) Order Authorizing the Retention and Employment of 1 The Debtors in these cases, along with the last four digits of each Debtor’s federal tax identification number, are: hhgregg, Inc. (0538); Gregg Appliances, Inc. (9508); and HHG Distributing LLC (5875). The location of the Debtors’ corporate headquarters is 160 West Carmel Drive, Suite 263, Carmel, IN 46032.

3

Chipman Brown Cicero & Cole, LLP to Pursue Certain Claims Against the Warrantech Entities [Docket No. 2853](the “Warrantech Retention Order”). 2. This Application seeks final compensation in the amount of $122,000.00 and final reimbursement of certain out-of-pocket expenses incurred by CBCC in the amount of $45,803.98 for the period December 27, 2017 through October 29, 2020 (the “Application Period”) related to the Andretti Action and the Warrantech Actions, as more fully described below (the “Actions”). This Application complies with the Bankruptcy Code, the Bankruptcy Rules, the Local Rules, the Agreed Entry and the Warrantech Order. BACKGROUND A. GENERAL BACKGROUND. 3. The Debtors filed their voluntary petitions for relief under Chapter 11 of the Bankruptcy Code on March 6, 2017. Pursuant to Sections 1107 and 1108 of the Bankruptcy Code, the Debtors operated their businesses as debtors-in-possession. No trustee or examiner has been appointed in these cases. 4. On March 10, 2017, the Office of the United States Trustee, pursuant to Sections 1102 of the Bankruptcy Code, appointed the Committee. B. CBCC’S RETENTION AND PAYMENT OF FEES AND EXPENSES. 5. On December 28, 2017, the Committee filed the Application of the Official Committee of Unsecured Creditors of Gregg Appliances, Inc., for Entry of an Order Authorizing the Employment and Retention of Chipman Brown Cicero & Cole, LLP as Counsel to Pursue Certain Claims Against the Debtors’ Directors and Officers [Docket No. 2134] (the “CBCC Retention Application”). 6. On February 27, 2018, the Court entered that certain Order Approving Agreed

4

Entry Regarding the Committee’s Retention and Employment of Chipman Brown Cicero & Cole, LLP to Pursue Certain Claims Against the Debtors’ Directors and Officers [Docket No. 2309] (“CBCC Retention Order”). A copy of the CBCC Retention Order is attached hereto as Exhibit A. 7. On May 10, 2019, the Committee filed the Application of the Official Committee of Unsecured Creditors of Gregg Appliances, Inc., for Entry of an Order Authorizing the Employment and Retention of Chipman Brown Cicero & Cole, LLP as Counsel to Pursue Claims Against the Warrantech Entities [Docket No. 2813] (the “Warrantech Retention Application”). 8. On June 5, 2019, the Court entered the Warrantech Retention Order approving the Warrantech Retention Application. A copy of the Warrantech Retention Order is attached hereto as Exhibit B. 9. Pursuant to the CBCC Retention Order and the Warrantech Retention Order (collectively, the “Retention Orders”), CBCC is not required to file interim fee applications, however, CBCC is required to file a final fee application upon completion of its engagements. Furthermore, the Retention Orders provide that CBCC shall be compensated for its services in accordance with and pursuant to the procedures set forth in the Bankruptcy Code, the Bankruptcy Rules, the Local Rules, the U.S. Trustee Guidelines and any other applicable orders of this Court; provided, however, that with respect to the final fee application, the fee structure set forth in the engagement letters shall be subject to review pursuant to the standard of review set forth in section 328 of the Bankruptcy Code and shall not be subject to the standard of review set forth in section 330 of the Bankruptcy Code, except solely by the Office of the U.S. Trustee for the Southern District of Indiana, which, for the avoidance of doubt, shall be entitled to review the final fee application for payment of compensation and reimbursement of expenses of CBCC under section

5

330 of the Bankruptcy Code. Finally, CBCC is not required to submit time records in support of their final fee application. 10. CBCC has concluded its engagements with regard to the Actions covered by the Retention Orders resulting in recoveries for the Debtors’ estates in the total amount of $610,000.00. 11. Pursuant to the Retention Orders, CBCC is entitled to legal fees on a contingency basis of 20% of all cash and noncash financial benefits or consideration received or recovered by the Debtors’ estates up to $10 million. 12. Pursuant to the Retention Orders, CBCC has earned a contingency fee in the total amount of $122,000.00 which is 20% of the cash to be received by the Debtors’ estates for a recovery in each of the Actions, as described more fully below.   13. CBCC is also authorized to seek final approval for the reasonable costs and expenses in performing legal services in connection with the Actions. JURISDICTION AND VENUE 14. This Court has jurisdiction to consider this Application pursuant to 28 U.S.C. §§ 157 and 1334. Venue of this proceeding and this Application is proper in the in this district pursuant to 28 U.S.C. §§ 1408 and 1409. The statutory predicates for this Application are 11 U.S.C §§ 328 and 1103. THE RESOLVED ACTIONS 15. On May 2, 2017, the Bankruptcy Court entered an order (the “Final DIP Order”) [D.I. 923] which, among other things, granted the Committee “the exclusive right, authority, standing and discretion to determine and to initiate, file, prosecute, enforce, abandon, settle, compromise, monetize, assign, transfer, release, withdraw, or litigate to judgment” certain Estate

6

Claims (as defined in ¶ 66 of the Final DIP Order), including any and all claims or causes of action held by the Debtors or their estates against their current or former directors and/or officers or any insurance company providing coverage for such individuals, and recover and/or collect any and all proceeds in whatever form, including recoveries and settlements thereof for the benefit of the Debtors’ and their estates.  A. The Andretti Action 16. On November 17, 2017, the Committee as Plaintiff, on behalf of hhgregg, filed a complaint against defendant Andretti Autosport 2, Inc. (“Andretti” or “Defendant”) in this Court, Adv. No. 17-50311 (the “Andretti Action”). 17. The Andretti Action sought to avoid and recover from the Defendant preferential and/or fraudulent transfers and to disallow any claim held by Defendant (either filed or scheduled) against any of the Debtors. 18. During the course of the above referenced Andretti Action, expert reports were prepared and the parties engaged in extensive discovery. 19. On June 17, 2020, the Committee and the Defendant resolved the Andretti Action without admission of liability for $120,000. 20. On June 19, 2020, the parties filed the Stipulation of Dismissal [Adv. Docket No. 60] and on June 29, 2020 this Court closed the Andretti Action. 21. CBCC is entitled to its contingency fee in the amount of $24,000, which is 20% of the Andretti settlement payment received by the Debtors’ estates. B. The Warrantech Actions 22. On November 17, 2017, the Committee as Plaintiff, on behalf of hhgregg, commenced an adversary proceeding before this Court asserting, among other things, that the

7

Debtors made transfer(s) totaling $3,389,000.46 to Warrantech2 that are avoidable under the provisions of Sections 547-550 of the Code, Adv. No. 17-50282 (the “Warrantech Avoidance Action”). 23. On March 5, 2019, the Committee as Plaintiff, on behalf of hhgregg, commenced an action before the Supreme Court for New York County alleging, among other things, damages of approximately $4 million for breach of contract and equitable subrogation/indemnity claims against all of the Warrantech Defendants (the “New York Action” and together with the Warrantech Avoidance Action, the “Warrantech Actions”). 24. The Debtors and the Warrantech Defendants also had certain pre- and post-petition receivables due and owing between the parties for 1) amounts owed to the Debtors for replacement products provided to Warrantech Defendants or customers directly and 2) amounts owed to Warrantech Defendants for service plan fees for sales of “Extended Service Protection Plans” to the Debtors’ customers that were resolved as part of the settlement with the Warrantech Defendants. 25. On October 29, 2020, the Committee and the Defendants globally resolved the Warrantech Actions for a combined settlement payment of $802,500.003. 26. CBCC is entitled to its contingency fee in the amount of $98,000 in the Warrantech Actions, which is 20% of the $490,000settlement payment attributable to the New York Action. 2 The defendant in the Warrantech Avoidance Action was Warrantech Consumer Product Services, Inc. dba Warrantech CPS, Inc. (“Warrantech”). The defendants in the New York Action were Warrantech, AMT Warranty Corporation (“AMT”), Technology Insurance Company, Inc. (“Technology Insurance”), Wesco Insurance Company (“Wesco”), and WCPS of Florida (“WCPS” and, collectively with Warrantech, AMT, Technology Insurance and Wesco, as to both actions, the “Warrantech Defendants”). 3 Although globally resolved, ASK LLP represented the Committee in the Warrantech Avoidance Action and CBCC represented the Committee in the New York Action. Both firms were retained on a contingency fee basis. The value of the settlement payment to be ascribed to the Warrantech Avoidance Action was $312,500.00 and the value of the settlement payment to be ascribed to the New York Action was $490,000.00 for purposes of computing each firm’s respective contingency fee.

8

EXPENSES 27. Attached hereto as Exhibit C is a summary of the reasonable out-of-pocket expenses incurred by CBCC during the Application period in the performance of services rendered on behalf of the Committee in pursuing each Action, including, among other things, mediation, expert and discovery costs. The costs for which reimbursement is requested total $45,803.98. The breakdown of the costs for each of the Actions includes, among other things, the rate of copying charges ($.10/page) and the basis for each rate, telephone charges, facsimile charges ($1.00/page – outgoing transmission only), messenger service, travel expenses, court reporter services, overnight delivery fees, outside reproduction, legal research and PACER charges. By this Application, CBCC does not seek expenses for incoming facsimile transmissions. Exhibit C also includes a detailed statement of unpaid expenses that have been previously approved and expenses incurred but not previously billed listed for each of the Actions. RELIEF REQUESTED 28. CBCC submits this Application pursuant to section 328(a) of the Bankruptcy Code, and the Retention Orders. By this Application, CBCC seeks final allowance and immediate payment of its contingency fee from the proceeds of the settlement payments for professional services rendered in the amount of $122,000.00 for the agreed upon fee as counsel to the Committee in each of the Actions and in accordance with the terms of the Retention Orders. CBCC also seeks final approval and reimbursement for the necessary expenses incurred in connection with its role as counsel in the amount of $45,803.98, to the extent not already paid. 29. CBCC respectfully submits that the compensation requested for the services rendered by CBCC to the Committee during the Application Period is fully justified and reasonable based upon (a) the complexity of the issues presented, (b) the experience necessary to identify

9

legal issues and perform the legal analysis, (c) the preclusion of other employment, (d) the customary contingent fee charged to clients in a non-bankruptcy setting for similar services rendered, (e) the experience, reputation and ability of the professionals rendering services, and (f) the amount of work expended by CBCC professionals to prosecute and ultimate resolve each of the Actions.  NOTICE, PRIOR APPLICATION AND CERTIFICATION 30. Notice of this Application has been provided in accordance with the CBCC Retention Orders. CBCC submits that the foregoing constitutes good and sufficient notice and that no other or further notice need be provided. 31. No previous application for the relief sought herein has been made to this or any other court. 32. CBCC has reviewed the requirements of the Local Rules and certifies that this Application complies with the Retention Orders and the applicable provisions of the UST Fee Guidelines, the Bankruptcy Code, the Bankruptcy Rules, and the Local Rules.

10

WHEREFORE, CBCC hereby respectfully requests the Court enter an order, granting CBCC’s contingency fee as final compensation in the amount of $122,000.00 and final allowance and reimbursement of certain out-of-pocket expenses incurred by CBCC in the amount of $45,803.98 to the extent not already paid. Dated: November 13, 2020 CHIPMAN BROWN CICERO & COLE, LLP By: /s/ William E. Chipman, Jr. William E. Chipman, Jr. (No. 3818) Hercules Plaza 1313 North Market Street, Suite 5400 Wilmington, Delaware 19801 Counsel for the Official Committee of Unsecured Creditors of Gregg Appliances, Inc.

11

IN THE UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF INDIANA INDIANAPOLIS DIVISION
Table 1 on page 12. Back to List of Tables
In re:
hhgregg, Inc., et al.,1
Debtors.
Chapter 11
Case No. 17-01302-RLM-11
(Jointly Administered)
CERTIFICATION OF WILLIAM E. CHIPMAN, JR. IN SUPPORT OF THE FINAL FEE APPLICATION OF CHIPMAN BROWN CICERO & COLE, LLP, AS SPECIAL COUNSEL FOR THE OFFICIAL COMMITTEE OF UNSECURED CREDITORS FOR ALLOWANCE OF COMPENSATION AND REIMBURSEMENT OF EXPENSES FOR SERVICES RENDERED DECEMBER 27, 2017 THROUGH OCTOBER 29, 2020 RELATED TO CERTAIN ACTIONS I, William E. Chipman, Jr. do hereby certify that: 1. I am a partner with the firm of Chipman Brown Cicero & Cole, LLP, which has been retained as special counsel to the Official Committee of Unsecured Creditors (the “Committee”) in the above-captioned Chapter 11 Cases. 2. This Certification is made in connection with the Final Fee Application of Chipman Brown Cicero & Cole, LLP, as Special Counsel for the Official Committee of Unsecured Creditors for Allowance of Compensation and Reimbursement of Expenses for Services Rendered December 27, 2017 Through October 29, 2020 Related to Certain Actions (the “Application”). 1 The Debtors in these cases, along with the last four digits of each Debtor’s federal tax identification number, are: hhgregg, Inc. (0538); Gregg Appliances, Inc. (9508); and HHG Distributing LLC (5875). The location of the Debtors’ corporate headquarters is 4151 East 96th Street, Indianapolis, Indiana 46240.

12

3. I have reviewed the Application and I hereby certify such Application complies with sections 105(a) and 331 of title 11 of the United States Code, Federal Rule of Bankruptcy Procedure 2016, Rules B-2014-1 and B-2016-1 of the Local Bankruptcy Rules for the Southern District of Indiana, the Order Approving Agreed Entry Regarding the Committee’s Retention and Employment of Chipman Brown Cicero & Cole, LLP to Pursue Certain Claims Against the Debtors’ Directors and Officers [Docket No. 2309], and the Order Authorizing the Retention and Employment of Chipman Brown Cicero & Cole, LLP to Pursue Certain Claims Against the Warrantech Entities [Docket No. 2853]. 4. In addition, I hereby certify that, to the best of my knowledge, information and belief after reasonable inquiry, the Application complies with the United States Trustee Guidelines for Reviewing Applications for Compensation and Reimbursement of Expenses Filed under 11 U.S.C. § 330 by Attorneys in Larger Chapter 11 Cases, effective June 11, 2013. 5. The facts set forth in the Application and this Certification are true and correct to the best of my knowledge, information, and belief. Dated: November 13, 2020 /s/ William E. Chipman, Jr. William E. Chipman, Jr.

13