Prolific Bankruptcy Judge Resigns After Ethics Probe

David Jones, a bankruptcy judge who has overseen some of the country’s largest renegotiations, resigned after an ethics complaint said he failed to disclose a years-long romantic relationship with an attorney whose firm had cases before his court. 

A formal judicial inquiry from the 5th U.S. Circuit Court of Appeals caused Chief Judge Priscilla Richman to file an ethics complaint against Jones, which led to his resignation, CoStar reports. 

“There is probable cause to believe that misconduct by Judge Jones has occurred,” Richman said in the ethics complaint, per CoStar.

Jones’ alleged misconduct centered around his relationship with Elizabeth Freeman, a bankruptcy attorney who formerly clerked for Jones and was a partner at the Jackson Walker law firm between 2017 and 2022. The firm’s attorneys frequently appeared in Jones’ Houston court during Freeman’s tenure, and Jones gave the go-ahead for Jackson Walker to receive “substantial” fees for its services, according to CoStar.

Jones served 12 years as a bankruptcy judge, helping sizable retailers like Neiman Marcus and JCPenney rework their rosters of stores. He also guided companies like Serta Simmons Bedding through debt negotiations and is overseeing Party City's Chapter 11 reorganization that led the retailer to eliminate almost $1B in debt. 

The complaint says “there is a reasonable probability” that Freeman, as a partner at Jackson Walker, benefited financially or had a financial interest in the fees Jones approved. Jones didn’t recuse himself from the firm’s cases and didn’t disclose his relationship with Freeman to parties involved in the bankruptcy cases being heard in his court, according to CoStar. 

Jackson Walker said it learned about a possible relationship between Freeman and Jones in March 2021 and conducted its own inquiry with the help of outside counsel. Freeman was also told to stop working or billing cases assigned to Jones. 

Freeman started her own law practice at the end of 2022.

Jones’ resignation is effective Nov. 15.