Posted Feb 01, 2008 11:44 pm CST
Biery predicts that bankruptcy lawyers soon will be as overworked as they’ve ever been, which is why the firm is on the hunt for more of them. “We have 30 lawyers devoted to the insolvency practice,” says Biery, who heads Fulbright & Jaworski’s bankruptcy, reorganization and creditors’ rights department. “I wouldn’t be at all surprised if we ended up at 60 in the next two to three years.”
Bell, Boyd & Lloyd hasn’t seen a dramatic uptick in its bankruptcy work yet, but firm chairman Jack McCarthy in Chicago believes it’s so close that the firm recently added eight attorneys to its two-lawyer practice group. “It’s not only business bankruptcy filings that we expect to increase,” McCarthy says. “There’ll be lots of business debt restructuring that’ll take place outside the filing of bankruptcy.”
The numbers on bankruptcy filings kept by the Administrative Office of the U.S. Courts seem to support these anecdotal predictions. Filings reached rock bottom in the quarter ending in March 2006, the first under a controversial new bankruptcy law; they have increased every quarter since.
“We’re definitely starting to see a turnaround in the lateral market for bankruptcy attorneys,” says Pamela DiCarlantonio, a Chicago managing director at the legal recruiting firm of Major, Lindsey & Africa. Though she concedes that some of her clients aren’t quite ready to declare a comeback. “There appear to be two camps,” she explains. “Those who predict that the tsunami is coming or is already here, and those who are more skeptical—at least as to the timing of the next big wave.”
Doubters tell DiCarlantonio that in the past several years, there have been projections every six months that another bankruptcy boom is coming, and each has been premature.
But Paul Glenn, chief judge of the U.S. Bankruptcy Court for the Middle District of Florida in Tampa, says the pace is picking up in his court. “The increase in filings has been fairly steady since the beginning of 2006, and it’s anticipated they’ll continue to increase—both as a result of general public awareness that bankruptcy is still available as relief for overburdening debt and as a result of the problems in the subprime mortgage area.”
Adds Jerry A. Brown, the chief judge of the U.S. Bankruptcy Court for the Eastern District of Louisiana in New Orleans: “Almost everybody feels that by 2009, filings will be back up.”