Evaporating Law Firms???
Major firms around America collapsing. Firms that survived The Great Depression, WWl and WWll. Simply a function of Alstrynomics....when money dries up for the masses, few have money......even lawyers.
Dec. 23 (Bloomberg) -- Thacher Proffitt & Wood, the 160 year- old New York-based law firm whose work in structured finance has slowed because of the subprime crisis, became the fourth U.S. firm to dissolve this year after more than half of its attorneys departed for a competitor.
Thacher Proffitt will wind down operations after Dec. 31, the firm said yesterday in a statement, following the departure of 100 lawyers to Chicago-based Sonnenschein, Nath & Rosenthal. Thacher Proffitt’s planning committee had unsuccessfully tried to negotiate a merger with an unnamed law firm over the past six months, according to the statement.
“Although many avenues for a merger were explored, in the current economic environment it became apparent to the committee that a merger could not be executed,” Thacher Proffitt said in the statement. “In light of severe reductions in revenue, it became clear that Thacher Proffitt would not have the financial resources to continue business operations.”
Sonnenschein is also facing slowing demand for legal services. The firm has fired 62 lawyers and about 175 staff since May due to “tumult in the financial markets” and its effect on clients, according to a memo Chairman Elliott Portnoy sent to attorneys in October. The new hires will double the size of the firm’s New York office.
At least two large law firms, San Francisco-based Thelen and Heller Ehrman, have collapsed in the past four months from a lack of business. Heller Ehrman saw its litigation work dry up since the firm settled several large cases in 2007. Thelen, like Thacher Proffitt, was focused on structured finance work.
Thelen and Heller Ehrman defaulted on their primary credit agreements because of a provision that restricts the number of partners who may depart the firm within a 12-month period.
New York-based Dreier filed for bankruptcy protection after its founder was jailed and accused of cheating hedge funds out of more than $100 million.
Dozens of law firms have cut lawyers and staff in the past year, mainly in structured finance and real estate. They include New York’s Dewey & LeBoeuf, Proskauer Rose, White & Case and Cadwalader, Wickersham & Taft; San Francisco’s Orrick, Herrington & Sutcliffe; and Chicago’s Mayer Brown and Katten Muchin Rosenman.
Note: notice the firm that absorbed a bunch of lawyers fired a bunch earlier.
This collective action will have a profound impact on commercial vacancies.
Thacher Proffitt, which had about 195 lawyers before the departures, put up for sublease all five floors of its headquarters during the past six months.
You know the problems are deep when the lawyers are being affected.