Jurisdiction and Authority
The S.D. Ind. bankruptcy court operates within the 7th Circuit. Attorney fee review in this district proceeds under 11 U.S.C. Sections 329 and 330, Federal Rule of Bankruptcy Procedure 2016(b) (disclosure), and Rule 2017 (procedural vehicle for fee review).
11 U.S.C. Section 329(b): "If such compensation exceeds the reasonable value of any such services, the court may cancel any such agreement, or order the return of any such payment, to the extent excessive..."
Any party in interest, including the debtor, trustee, U.S. Trustee, or any creditor, may move for fee review. The bankruptcy court may also raise the issue on its own motion under Rule 2017.
7th Circuit Authority
The 7th Circuit's fee-review framework combines the lodestar methodology with the Section 330(a)(3) factors. The leading cases applying this framework are catalogued in our Section 329(b) caselaw map, organized by doctrinal prong (disclosure, reasonableness, remedy, procedural authority).
Key concepts applied in every circuit:
- Disclosure prong: Section 329(a) and Rule 2016(b) require complete and timely disclosure of all compensation. Failure is independently sanctionable.
- Reasonableness prong: The Section 330(a)(3) factors - time spent, rates charged, necessity and benefit, timeliness, skill, and comparable non-bankruptcy compensation.
- Remedy prong: Full disgorgement is the presumptive remedy for disclosure failures; partial reduction is available for reasonableness-only challenges.
- Procedural authority: Rule 2017 motion, U.S. Trustee Section 307 standing, and Court sua sponte review.
The Three Documents
Every fee review analysis begins with three documents:
- The Rule 2016(b) disclosure statement - filed at the opening of the case and supplemented when the fee arrangement changes
- The fee application (if filed) - typically required in Chapter 11 and Subchapter V; may be optional in consumer Chapter 7/13
- The complete billing record - time entries, task descriptions, rates, and amounts charged
Discrepancies among the three documents are the strongest evidence of a Section 329 violation. See billing review methodology for line-by-line analysis.
Local Practice Considerations
Each bankruptcy court maintains local rules and presumptive fee ("no-look") guidelines. Common variations:
- Consumer Chapter 13 no-look fees (typical range $3,000 - $5,500, varies by district)
- Fee application timing and form requirements
- Interim compensation procedures in Chapter 11 and Subchapter V
- Trustee compensation separate from debtor's counsel fees
Local rules for S.D. Ind. are available on the court's website. Section 329(b) applies in every district regardless of local no-look fees - a presumptive fee is not a safe harbor against a reasonableness challenge.