Paula S. Beran, Esquire (Va. Bar No. 34679)

Tavenner & Beran, PLC 

20 North Eighth Street, Second Floor

Richmond, Virginia 23219

Telephone: (804) 783-8300

Telecopy: (804) 783-0178

Counsel for Lynn L. Tavenner, Chapter 7 Trustee

UNITED STATES BANKRUPTCY COURT

EASTERN DISTRICT OF VIRGINIA

Richmond Division

In re: Case No. 19-34574-KRH

LeClairRyan, PLLC,1

Debtor Chapter 7

DECLARATION OF LYNN L. TAVENNER, TRUSTEE

I, Lynn L. Tavenner, Trustee, not individually but solely in my capacity as the Chapter 7 

trustee (in such capacity, the “Chapter 7 Trustee” and/or the “Trustee”) of the bankruptcy 

estate (the “Estate”) of LeClairRyan PLLC (“LeClairRyan” and/or the “Debtor” and/or the 

“Company”), in the above- referenced Chapter 7 case (the “Case”), pursuant to 28 U.S.C. § 

1746, hereby declare as follows under penalty of perjury to the best of my knowledge, 

information, and belief:

1. I am the duly appointed Chapter 7 Trustee in the LeClairRyan Case. 

2. I submit this declaration in support of the matters on the Proposed Hearing 

Agenda filed at ECF No. 1111, which matters are (a) Motion to Expedite Hearing on Trustee’s 

Motion (the “Motion to Expedite”) and (b) Motion for Approval of Compromise and 

Settlement and Memorandum of Law (the “9091 Motion”, together with the Motion to Expedite, 

1 The principal address of the Debtor as of the petition date was 4405 Cox Road, Glen Allen, Virginia 23060, and 

the last four digits of the Debtor’s federal tax identification number are 2451.

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the “Motions”). Unless otherwise defined herein, capitalized terms shall have the meaning 

ascribed in the 9019 Motion. 

3. The statements in this Declaration are, except where specifically noted, based on 

my personal knowledge on information that I have obtained in connection with my role as the 

Trustee. If I were called upon to testify, I could and would competently testify to the facts set forth 

herein on that basis.

4. The relief requested in the Motions is based upon a valid exercise of my business 

judgment and is in the best interests of the Estate.

5. As part of my administration of this Estate and as I began investigating causes of 

action, I determined in the exercise of my business judgment that it was in the best interest of the 

Estate to request that this Court establish procedures for prosecuting and/or settling matters. As 

such, I, through counsel, proposed to this Court certain procedures, including but not limited to 

those in my Motion for an Order Establishing Procedures Regarding the Prosecution of Actions 

Involving Former Attorneys and Certain Others and Memorandum in Support Thereof (the “FAO 

Procedures Motion”), which were approved by three orders of this Court (collectively, the “FAO 

Order”). 

6. Pursuant to the procedures established by the FAO Order, I alleged certain civil and 

statutory claims against the Defendants (collectively, the “Claims”). Thereafter, certain of the 

Defendants and their counsel engaged in settlement discussions and entered into tolling 

agreements. For other Defendants, I filed complaints in various adversary proceedings, including 

the Adversary Proceedings. 

7. I asserted Claims that included (a) civil and statutory claims against the Defendants

including, without limitation, Management Wrongful Acts or Interrelated Wrongful Acts, 

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including statutory or common law breach of fiduciary duty, trade secrets, statutory and common 

law conspiracy, or unlawful distribution in violation of Va. Code Ann. §§ 13.1-653, 13.1-690, and 

13.1–692 (the “Covered Claims”) and (b) additional claims under Chapter 5 of the Bankruptcy 

Code, under Virginia Code §55.1-400 or Va. Code §13.1-1035, or other similar state law claims, 

including but not limited to claims for unjust enrichment, conversion, and/or unlawful distributions 

received directly or indirectly to or for the benefit of any Defendant and/or Insured Person 

(collectively, the “Non-Covered Claims”).

8. After I asserted Claims, I was informed that certain individuals sought coverage 

under a particular insurance policy. Specifically, prior to the Petition Date, Columbia issued a 

Management Liability Policy to LeClairRyan, Policy Number 596749072 (as modified by Runoff 

Endorsement No. 10) with a liability limit of $10,000,000 (the “Columbia Policy”). LeClair Ryan 

is the named insured under the Columbia Policy and holds direct claims against it as well. The 

Columbia Policy also provides coverage to individuals on account of certain claims. The 

Columbia Policy is a waning policy, and any claim expenses paid from the policy reduce amounts 

that could otherwise be available for the benefit of the Estate. I, through counsel, had previously 

provided a Notice of Claim/Circumstances to Columbia and preserved the Estate’s interest in the 

Columbia Policy. 

9. On May 7, 2021, Columbia filed a Motion for Relief From the Automatic Stay 

(the “Motion for Relief From Stay”), seeking relief to permit it to advance claim expenses 

(“Claim Expenses”). I , through counsel, filed a Limited Objection to the Motion for Relief from 

the Automatic Stay (the “Limited Objection”), asserting that the Estate had an interest in the 

proceeds of the Columbia Policy and arguing that the form of Order on the Motion for Relief 

should not decide the legal issue but rather preserve the rights of all parties with respect thereto 

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and provide for an orderly mechanism for the limited, reasonable payment of a small portion of 

the Columbia Policy proceeds with a reporting process so that this Court and I (along with requisite 

interested parties) could monitor the remaining, available proceeds. After significant negotiations 

with Columbia, this Court entered a “Consent Order Granting Relief From the Automatic Stay and 

Establishing Procedures for Access to Proceeds of Insurance Policy” (the “Consent Order”). 

Among other things, the Consent Order provided that Columbia could advance certain Claim 

Expenses to Insured Persons up to and not to exceed $1,000,000 (subject to a full reservation of 

Columbia’s rights, remedies, and defenses for the defense of the Insured Persons) and that I, on 

behalf of the Estate, had certain rights to object to the advancements of Claim Expenses. 

10. The Consent Order also required that I be provided updates with amounts being 

sought for Claim Expenses. Upon receiving these updates, I determined that it was in the Estate’s 

best interest to take additional steps to protect and preserve the Columbia Policy for the benefit of 

the Estate. As such, I suggested and encouraged global settlement discussions with all requisite 

parties in the same physical and/or virtual room. Although it is unclear to me who constitutes an 

Insured Person under the Columbia Policy, Columbia and the Defendants assert that the 

Defendants are “Insured Persons.” Given the same, I determined in the exercise of my business 

judgement that it was in the best interest of the Estate to invite all Defendants to any global 

settlement meeting. 

11. On November 16, 2021, I, the Defendants, and Columbia (along with respective 

counsel) participated in an all-day settlement conference (the “Settlement Conference”). 

12. Based on these extensive negotiations, I, the Defendants, and Columbia seek to 

fully and finally resolve the Covered Claims on the terms (the “Settlement”) set forth in the 

Settlement Agreement attached as Exhibit A to the 9019 Motion. 

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13. While parties should review the Settlement Agreement for the specific terms of the 

Settlement, I perceive the following as the salient terms of the Settlement: 

• Columbia shall pay the Estate $9,475,000 (nine million four hundred 

seventy-five thousand dollars) in full satisfaction of the Covered Claims (the 

“Payment”). 

• In addition, Columbia shall pay not more than $525,000 (five hundred 

twenty-five thousand dollars) in total Claim Expenses in accordance with the 

Columbia Policy. Certain Defendants waived the right to seek defense costs from 

the Columbia Policy, which preserves a greater recovery for the Estate . Columbia 

will use good faith in reviewing the invoices submitted to determine if they 

constitute covered Claim Expenses. I will review such documentation and consult 

with Columbia regarding the Claim Expenses. 

• I, on behalf of the Estate, will release Defendants and other Insured Persons 

(and other related Persons (as said term is defined 11 U.S.C. § 101(41) ) solely as 

it relates to Covered Claims, regardless of whether or not said Covered Claims 

exceed the coverage or benefits of the Columbia Policy. It is important to note that 

I am not releasing as part of the Settlement any of the Defendants and/or Insured 

Person, in part or in whole, as to Non-Covered Claims. 

• The Defendants and the Insured Persons will release me and the Estate (and 

other related Persons) for claims that the Defendants made, could have made, or are 

able to make for relying on Management Wrongful Acts, and for asserting, 

pursuing, settling, and/or releasing any of the Covered Claims.

• I, on behalf of the Estate, and the Defendants will release Columbia for any 

and all claims for coverage or insurance benefits that could have been made under 

the Columbia Policy.

• The proposed order granting the 9019 Motion includes findings that the 

releases were given in good faith as defined in Virginia Code Section 8.01-35.1, 

and the Defendants shall be entitled to all of the applicable protections of Virginia 

Code Section 8.01-35.1. The specific form of order ultimately rests with this Court 

and I would never intentionally attempt to usurp this Court’s authority; as such I 

merely agreed that the proposed order would contain the requested language. The 

Settlement is conditioned upon the good faith finding as defined in Virginia Code 

Section 8.01-35.1. ; and 

• Upon this Court’s approval and my receipt of the Payment, all Persons will 

be enjoined in a narrowly tailored, limited in purpose, scope and effect (the 

“Contribution Bar”). 

14. I, in the exercise of my business judgment and in consultation with my 

professionals, believe that the Settlement (a) is fair and equitable and in the best interests 

of the Estate and (b) results in maximum value to the Estate.

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15. Resolution of the Covered Claims will significantly reduce administrative 

fees and costs for the Estate by eliminating time-consuming and expensive litigation with 

more than twenty-five Defendants with respect to Covered Claims. Before commencing 

the Settlement Conference, I conducted due diligence on the enforcement and ultimate 

collectability of potential judgments against the Defendants and determined, among other 

things, that proceeds from the Columbia Policy were the best source of payment to 

compensate the Estate for damages caused by the Defendants for the Covered Claims, even 

if it meant releasing significant Claims against the Defendants for damages that would 

exceed the limits of the Columbia Policy. Moreover, Non-Covered Claims against the 

Defendants are not included in the Settlement and therefore I may, if successful on the 

Non-Covered Claims, recover additional sums from these Defendants. Furthermore, I also 

insisted upon a specific mechanism to ensure that all Claim Expenses are paid pursuant to 

and in accordance with the Settlement Agreement and the Columbia Policy, consistent with 

the Estate’s rights under this Court’s Consent Order.

16. I insisted that the Contribution Bar, if any, be narrowly tailored, limited in purpose, 

scope and effect, and not a third-party “bankruptcy discharge.” Furthermore, I required that the 

Contribution Bar, if any, not release direct third-party claims, except to the extent such claims 

were property of the Estate and derivative of the Debtor’s right or (i) asserted against Contribution 

Releasees (as that term is defined by the Settlement Agreement) by any person based on theories 

of joint and several liability; or (ii) for set-off, indemnity, contribution, or apportionment of 

liability under Virginia Code Section 8.01-35.1 or other applicable law. I also insisted that other 

releases benefit the Estate. For example, if any Defendant engaged in a Management Wrongful 

Act (such as actual or alleged error, misstatement, misleading statement, act or omission) and 

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thereafter an Estate representative relied on the same, it is not beneficial to the Estate to release 

that Defendant for causing an issue but then allow the Defendant to seek recovery from the Estate 

and/or Estate representatives. As such, the release includes reliance on a Management Wrongful 

Act.

17. The Settlement was the result of extensive, arms-length negotiations. I proceed in 

good faith, and I perceive that all others acted in good faith. Neither the Settlement Agreement 

nor any of the negotiations leading to any portion of the Settlement were collusive. 

18. One of the Defendants is Gary D. LeClair (“Mr. LeClair”), who, is a defendant 

in the First Amended Complaint (“UnitedLex Amended Complaint”) filed against ULX 

Partners, LLC, ULX Manager LLC, UnitedLex Corporation and Gary LeClair on August 25, 202 

in Adversary Proceeding 20-03142 (the “UnitedLex Adversary Proceeding”). As this Court is 

aware, the UnitedLex Adversary Proceeding is scheduled for a lengthy trial, beginning in April 

2022. To avoid additional, significant expenses related to that litigation, I and Mr. LeClair desire 

for the Motion to be heard as soon as possible. For example, discovery in the matter is in full 

swing, including but not limited to responses to interrogatories and requests for admission due 

soon or the subject to ongoing negotiations, and depositions already scheduled starting 

November 30. To avoid additional, significant expenses related to extensive discovery that 

would ultimately be unnecessary if this Court approves the Settlement Agreement, I maintain, in 

the exercise of my business judgement, that it is in the best interest of the Estate for the 9019 

Motion to be heard as soon as possible. 

19. Similarly, matters involving other Defendants have upcoming deadlines, and the 

Estate would save resources if the 9019 Motion was heard as soon as possible. As such, I 

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maintain, in the exercise of my business judgement, that it is in the best interest of the Estate for 

the 9019 Motion to be heard as soon as possible

20. To the best of my knowledge, information, and belief, I declare under penalty of 

perjury that the foregoing is true and correct.

LYNN L. TAVENNER, CHAPTER 7 TRUSTEE

Dated: November 28, 2021

Richmond, Virginia

By: /s/ Lynn L. Tavenner

Lynn L. Tavenner, Chapter 7 Trustee

Respectfully submitted,

LYNN L. TAVENNER, CHAPTER 7 TRUSTEE

Dated: November 28, 2021

Richmond, Virginia

By: /s/ Paula S. Beran

Paula S. Beran, Esquire (VSB No. 34679)

PBeran@TB-LawFirm.com

Tavenner & Beran, PLC

20 North 8th Street

Richmond, Virginia 23219

Telephone: (804) 783-8300

Counsel for Lynn L. Tavenner, Chapter 7 Trustee

CERTIFICATE OF SERVICE

I certify that on this 28th day of November 2021, a true copy of the foregoing Declaration 

was sent electronically to:

Shannon F. Pecoraro, Esquire

Department of Justice

Office of the United States Trustee

701 East Broad Street, Suite 4304

Richmond, Virginia 23219

And all other parties receiving CM/ECF notices in this Case.

/s/ Paula S.Beran

Paula S. Beran, Esquire

Counsel for Lynn L. Tavenner, Chapter 7 Trustee

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