Willkie Farr & Gallagher has been thrust into the legal spotlight, facing a $735 million fraud lawsuit that reads less like a routine civil claim and more like a flare fired across the bow of Big Law.
The case arrives as the firm is still reckoning with reputational tremors from last year’s high-profile talent departures tied to its controversial work for the Trump administration. Now, critics say, the stakes are far higher — testing how far elite law firms can go in dealmaking before conflicts turn combustible.
A Deal That Unraveled
BRC Group Holdings — the renamed B. Riley — and related entities filed suit in New York over the 2023 take-private of Franchise Group, the retail operator behind Pet Supplies Plus and other chains.
The complaint alleges that former Franchise Group CEO Brian Kahn engineered what it calls a “sophisticated fraud” to unlock more than $735 million in financing for the $2.8 billion buyout. According to the filing, the maneuver helped Kahn ease crushing personal debt at a time when he was already under scrutiny in an unrelated hedge fund investigation.
The lawsuit paints the transaction like a house built on sand: impressive from afar, unstable beneath the surface.
