Photo of James F. McShane

James F. McShane

Special Counsel



  • J.D., Cornell Law School, 1985
  • B.A., University of Colorado, 1976
  • California, 1986
  • Washington, 1991


James McShane is a special counsel in the Financial Institutions Litigation and Business Trial Practice Groups in the firm's Los Angeles office.

Areas of Practice

Mr. McShane joined Sheppard, Mullin, Richter & Hampton as an associate in 1985 and was elected to the partnership in 1993. He has extensive experience in general business, creditors' rights and bankruptcy litigation, specializing in cases arising out of complex financial relationships, credit reporting, contract and revenue bond defaults, business torts, unfair competition, fiduciary malfeasance, intellectual property and construction defects. He has tried cases for plaintiffs and defendants in state, federal and bankruptcy courts, representing corporations, law firms, financial institutions, construction contractors, secured and unsecured creditors, committees, indenture trustees and bankruptcy trustees.

Mr. McShane's trial experience includes jury verdicts of $1.2 million and $2.97 million against the officers and directors of a corporation on behalf of its bankruptcy trustee. These judgments, along with over $7.5 million in settlements won from other defendants, enabled a bankruptcy trustee, which began the case with no realizable assets, to repay in full the principal of all debts owed by the bankrupt.

Mr. McShane successfully defended International Paper Company against over $200 million in claims asserted by a plaintiff who claimed International Paper had breached an obligation to provide financial and technical support to a joint venture for the development and marketing of children's clothing products. International Paper proved at trial that it completely fulfilled its obligations and had never made any open-ended funding commitment. Following a four-month bench trial, the Court awarded the plaintiff nothing, and awarded International Paper $6.1 million on its counterclaims. The case was significant because the Bankruptcy Court struck the plaintiff's demand for trial by jury, a decision Mr. McShane and several partners successfully defended on appeal. Further appeals are pending.

Mr. McShane has represented a number of lenders in bond default litigation. In one recent case, he represented a bank whose $37.2 million letter of credit supported the financing of what was supposed to have been a state of the art biomass-fueled power plant. The plant failed due to serious technical difficulties. Mr. McShane led a discovery team which developed strong evidence that the design/build engineers had learned of critical design defects, prior to construction, and had purposely withheld the adverse information from the bank in order to preserve its role in the financing. This evidence led to a settlement just before trial. The case was noteworthy because the Court ruled that the bank had standing to pursue its fraud claims even though the letter of credit had not yet been drawn; the Court correctly found standing in the fact that the fraud had seriously damaged the value of the collateral securing the letter of credit, leaving the bank substantially, if not entirely, unsecured.

Mr. McShane has defended public contractors in bid protest actions and construction defect litigation, pursued commercial code and contract remedies for financial institutions and corporations, prosecuted and defended legal malpractice cases and protected lenders' interests in bankruptcy estates and civil forfeiture cases.


  • Member, Los Angeles County
  • Member, American Bar Association
  • Member, Association of Business Trial Lawyers
  • Member, Financial Lawyers Conference
  • Member, The Bankruptcy Forum