With Kodak Bankruptcy, a First for Sullivan & Cromwell

With Kodak Bankruptcy, a First for Sullivan & Cromwell

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Sullivan & Cromwell doesn't usually serve as lead debtor's counsel in bankruptcy cases, but the firm made an exception on Thursday when longtime client Eastman Kodak initiated Chapter 11 proceedings in Manhattan.

S&C was founded in 1879, the same year Kodak founder George Eastman sought to obtain a patent on a plate-coating machine that would eventually give rise to his iconic camera company, which has struggled in recent years to adapt to a changing market, most recently seeking to use its many patents to shore up a cash shortfall.

When that last-ditch effort stalled, bankruptcy seemed almost inevitable. And when Kodak submitted its Chapter 11 petition, the filing contained a first: S&C listed as general bankruptcy counsel to the debtor. (Court filings also show that Delaware-based Young, Conaway, Stargatt & Taylor is serving as special conflicts counsel to Kodak, which secured a $950 million line of credit from Citigroupto continue its operations in bankruptcy.)

Andrew Dietderich, the head of S&C’s bankruptcy and restructuring group, spoke with The Am Law Daily early Thursday ahead of Kodak's 4 p.m. hearing in U.S. bankruptcy court near Battery Park, just a few blocks from the firm’s downtown headquarters.

"This is the first debtor's case [S&C] has done itself as 327(a) debtor's counsel," Dietderich said. "We have previously served as 327(e) corporate counsel to clients, but this was a special circumstance. We've represented Kodak since 1972 and [this bankruptcy filing] is the 173rd matter the firm has handled for the company."

When Kodak's various efforts to restructure its operations out of court proved unsuccessful, Dietderich says the company requested th