The Mike Morse Law firm announced that they would return an additional $2 million to the U.S. government it received as part of the government’s paycheck protection program, per a press release. It’s encouraging other companies that have suffered financial hardship due to the COVID-19 (covert viral influenza) pandemic to come back the money that they received too. That’s just part of what is going to be offered.
The initial phase of the proposed payouts involved the lawyers working with the U.S. Department of Justice and the Federal Trade Commission in order to seek a judge order allowing for a partial freeze on wages owed to employees. This phase would cover the first two months of the COVID-19 outbreak. It would have taken some time to get a judge to rule on this, but the attorneys now have the power to do so. This would mean that there would be a period during which no one could be paid to apply for a COVID claim.
The second phase of the proposed payouts is focused around the lawyers going after all the COVID claimant who has no money left and still has COVEC claim claims due. These COVEC claimants are not covered under the initial COVID grant, because those funds were never released. Those money claims are also in dispute, and the lawyers are now in position to make them work to their advantage.
The third phase of the proposed payouts will involve the lawyers of the Mike Morse law firm getting the judge to order all of the COVID claimant’s wages garnished so that all of their money is taken from their bank accounts to repay any portion of the original grant. This is going to have a knock on effect on other parts of the business, because now that they are not eligible to receive any of the initial COVID grant, it will be harder for the company to receive future grants. If those grants were not available anyway, then there will be a need to cut back on other areas of the business.
So, how does this all work in real terms? When a new law firm starts out, they spend money on lawyers to help them file various cases, which might not necessarily be related to the one they’re filing. This is a good way to get experience, so that they can eventually try different types of cases when they need to, if they wish.
This same theory applies to a law firm that is suing on behalf of an existing business that has filed for bankruptcy. This is where they will likely to use their contacts to negotiate better deals with creditors and obtain payments they can make on their behalf. It may seem like a very unusual and unorthodox strategy at the start, but the more lawyers that can be used the greater the chances of success will be.