MARVIN ISGUR, Bankruptcy Judge
The Court has reviewed the Trustee's applications to employ Steve Smith, P.C., as his counsel in each of the above referenced cases. For the reasons set forth below, the Court finds that the Trustee's application fails to set forth a basis on which the employment of Steve Smith, P.C. is "in the best interest of the estate." 11 U.S.C. § 327(d).
The Trustee's application includes comprehensive and forthright disclosures. Steve Smith, P.C. is a law firm owned by the Trustee. The Trustee and his wife are the only attorneys employed by the firm. The Trustee seeks to designate Blanche Smith, the Trustee's wife, as attorney in charge for all the above-captioned cases.
Section 327(a) authorizes a trustee to employ counsel with the court's approval. The trustee may employ his spouse, subject to the trustee's fiduciary duty to the estate. In re Alexander, 129 B.R. 183 (Bankr. D. Minn. 1991). The trustee may employ his own firm pursuant to § 327(d). However, employment of the trustee's own firm may only occur if it is "in the best interest of the estate." 11 U.S.C. § 327(d).
The Trustee's application reflects that the Trustee is seeking to retain his own firm for reasons that are unrelated to whether it is in the best interest of the estate. Exhibit "A" to the Trustee's application indicates that the Trustee relies on his own firm to handle unprofitable cases. Thus, the Trustee reasons that in order to allow his firm to afford to prosecute unprofitable cases, he must also hire his firm to handle profitable cases — such as this one.
The Trustee's logic reflects that it may be in his firm's best interest to be hired in this case. It may also reflect that it is in the best interest of unrelated, unprofitable estates for the Trustee's firm to be hired in this case. However, those are factors that are irrelevant to the determination that must be made under § 327(d). Indeed, those factors reflect that the Trustee is considering factors that are inconsistent with his well-established duties to the estate.
This case involves a complex series of financial transactions, the prosecution of lawsuits involving foreign entities, and the possibility of complex trials to be conducted before this or other courts. Indeed, over 100 related adversary proceedings have already been filed. There are a number of lawyers and law firms in Houston, and in the United States, that are eminently qualified to handle such complex litigation. This Order is not to imply that the Smith law firm could not be one of those firms.
Section 327(d) is an exception to the general rule that an estate professional must be "a disinterested person" pursuant to § 327(a). According, "a trustee should be allowed to retain his own law firm only if the "best-interest-of-the-estate" test is affirmatively demonstrated. In re Kurtzman, 220 B.R. 801 (Bankr. S.D.N.Y. 1998). The Kurtzman opinion contains an extensive discussion regarding the potential conflicts that arise when a trustee retains his own law firm on behalf of an estate. However, unlike Kurtzman, this Court has no question about the integrity of Trustee Smith or the quality of his work. Rather, the Court finds that — even with individuals of the highest integrity — a separate showing of "best interest" must be made in every case in which a trustee seeks to retain his own firm. This showing may be contained in the application to employ; but it must be made. In this case, no showing has been made.
Here, Trustee Smith seeks to appoint Blanche Smith as the attorney-in-charge of this matter. No showing has been made that employment of Ms. Smith as attorney-in-charge "is in the best interest of the estate." In this highly complex case, the Court requires the Trustee to exercise his judgment based on the appropriate factors under § 327(d). The benefits to his law firm and to other, unrelated estates are factors that should not be considered.
Rather, there must be a showing that "representation by the trustee's law firm would be in the best interest of the estate as opposed to representation by an independent law firm." In re Butler Industr., 114 B.R. 695, 698 (C.D. Cal. 1990). Butler lists four examples of possible cause. These include:
1. When the representation is for preference or fraudulent conveyance actions where counsel will have to look for a recovery in order to collect the fees.
2. When only a nominal amount of work must be performed.
3. When the work must be performed on such an urgent basis that outside counsel cannot be hired.
4. When there will be a substantial cost savings to the estate.
Id. at 698, n. 1.
Most relevant authority — including Butler — attempts to limit the retention of the trustee's own firm to small cases. Because such considerations are inconsistent with the plain language of § 327(d), this Court declines to impose such a limit. See United States v. Ron Pair Enterprises, Inc., 489 U.S. 235, 241 (1989).
The Court has been unable to locate a comprehensive guide as to when retention of the Trustee's own law firm should be considered in the "best interest of the estate." Accordingly, the Court has determined that it will consider the following factors in determining whether to approve the retention by the Trustee of the Trustee's law firm as counsel to the estate:
1. The qualifications of the members of the firm compared to the complexity of the case.
2. Whether the firm is regularly hired by others to handle similar litigation.
3. Whether the anticipated litigation predominantly involves issues of bankruptcy law with which the law firm has particularized expertise.
4. Whether the time commitment required to handle the case is consistent with the size of the firm and the balance of the firm's time commitments.
5. Whether only a nominal amount of work must be performed.
6. Whether there will be material cost savings to the estate.
7. The availability of other qualified firms to handle the case.
8. The rates charged by the firm compared to the rates charged by other qualified firms.
9. Any other case-specific factors.
The Trustee is granted leave to re-file the applications.