For a while, it looked as if both Winston & Strawn and Katten Muchin Rosenman had escaped malpractice claims related to Thomas Petters’ $3.6 billion Ponzi scheme. But while the case against Winston ran aground last year at the U.S. Supreme Court, Katten is now back on the defensive.
On Tuesday, the U.S. Court of Appeals for the Seventh Circuit revived malpractice claims against Katten brought by Jenner & Block’s Ronald Peterson, the bankruptcy trustee for Lancelot Investors Fund Ltd. The fund, run by Gregory Bell, had invested over $2 billion with Petters, and went under after Petters’ Ponzi scheme crumbled. (Petters was sentenced in 2010 to a 50-year prison term; Bell separately pleaded guilty to fraud charges, conceding that he knew of Petters’ scheme starting in 2008.)
