With the Downturn, It’s Time to Rethink the Legal Profession

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With the Downturn, It’s Time to Rethink the Legal Profession By ADAM COHEN April 1, 2009

The economic downturn is hitting the legal world hard. American Lawyer is calling it “the fire this time” and warning that big firms may be hurtling toward “a paradigm-shifting, blood-in-the-suites” future. The Law Shucks blog has a “layoff tracker,” and it is grim reading. Top firms are rapidly thinning their ranks, and several — including Heller Ehrman, a venerable 500-plus-lawyer firm founded in 1890 — have closed."

Law Firm Death Watch

Image via WikipediaLaw Firm Failures 2008
Heller Ehrman
Thelan
Drier LLP

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Report: More firms will fail

Image via Wikipedia"Heller Ehrman and Thelen won't be the only firms to fail amid the floundering economy."

That prediction comes from the latest report issued by Hildebrandt International, which examines the reasons that law firms fail. 'Recognizing that the legal market is continuing to segment, we expect that we will continue to see a steady number of both mergers and dissolutions, even after the recovery from the current economic downturn,' the report reads.

The report isn't all doom and gloom, though. It concludes that firms tend to fail for several specific reasons, and dissolution can be avoided if leaders are able to recognize those problems early on.

'The seeds of most law firm failures are sown long before the actual dissolutions,' the report reads. 'In our experience, early diagnosis and action can usually prevent the fundamental flaws . . . from deteriorating into full-blown law firm failures.'"

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Law.com - Thelen Looks to Parcel Out Sections, Core Group May Stick Together

Law.com - Thelen Looks to Parcel Out Sections, Core Group May Stick Together: "Thelen would not be the first San Francisco law firm to suffer this year. The partnership at Heller Ehrman voted to dissolve that firm on Sept. 26 after a string of departures in recent years led to the firm's banks -- Bank of America and Citibank -- forcing the firm to shut down.

More generally, recruiters, consultants and firms are not optimistic about how 2008 will end for law firms, with most saying that the best a firm could hope for is flat revenues."

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Bold Statements of Big Law's Near Future

Paul Lippe says:

"A law firm friend of mine told me many of his peers were "shocked" at the demise of Heller and its failure to find a merger partner. . . . So let me make a prediction: More Am Law 200 firms will Heller-ize over the next 18 months than will merge. Why?"

For more, read the article at Welcome to the Future: Heller Shock?

Mayer Brown and Heller Ehrman Merger Called Off

Image via WikipediaMayer Brown Calls Off Merger Talks with Heller Ehrman

Discussion of a Mayer Brown-Heller merger began days after Heller's talks with Baker & McKenzie ended. Heller has been faced with major partner defections.

"Heller is a fine firm with outstanding lawyers," Mayer Brown said. "Like us, they have a long heritage of excellence in their work and service to clients. A merger with them would have offered potential benefits for both firms and our clients." Mayer said that client and practice conflicts could not be resolved.

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