THE ETHICS OF REPRESENTING DEBTORS AND CREDITORS IN BANKRUPTCY

professionals should not involve themselves in every minute aspect of the DIP's business, incurring excessive fees that inappropriately drain the estate.³⁷³ Nor should they act as mere spectators, however, contributing nothing to benefit the creditors, while reaping the estate's cash for their fees.³⁷⁴ When issues arising in the case have a significant impact on creditor distributions, committee counsel should undertake a factual and legal analysis and bring the conclusions to the court.³⁷⁵ But once it becomes reasonably obvious that unsecured creditors will not receive a distribution, committee counsel must scale back services.³⁷⁶

3. Professionals employed by one committee generally may not serve another committee in the same case or in a related case to avoid breaching fiduciary duties.³⁷⁷ A single creditors' committee and its counsel may be appointed, however, in related, jointly administered cases.³⁷⁸
4. An attorney representing a creditors' committee may not represent any other entity having an adverse interest in connection with the case.³⁷⁹ But representation of one or more creditors of the same class represented by the committee is not considered an adverse interest per se.³⁸⁰ The ability to represent creditors and the creditors' committee simultaneously was not authorized until the 1984 BAFJA amendments to the Bankruptcy Code. Prior representation of another party in interest may be disqualifying.³⁸¹
5. Courts evaluate potential conflicts between duties to the committee and duties to a separate creditor client on a case by case basis. Pursuing litigation for individual creditors potentially adverse to the committee or other committee members has been held to require disqualification as committee counsel.³⁸² A remote, speculative possibility of a future dispute over a creditor client's claim or a possible cause of action against that client does not disqualify committee counsel.³⁸³ Even though the interests of the committee and an individual creditor client