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Alimony Decision Shows How Layoff Affected BigLaw Partner

Posted Mar 30, 2012 8:34 AM CDT
By Debra Cassens Weiss

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An Illinois divorce decision showcases the economic problems that can plague BigLaw partners ousted from their jobs during the recession.

The case involves David McLauchlan, who sought to modify an order that he pay his wife of more than 30 years $14,000 a month in monthly alimony after their divorce, the Am Law Daily reports. McLauchlan worked for 34 years at Lord Bissell & Brook, serving as an executive committee member and earning as much as $500,000 a year.

But in 2006, six years after his divorce became final, his earnings fell. His income continued on a downward trajectory as Lord Bissell merged with Locke Liddell & Sapp, falling to about $165,000 in 2008. McLauchlan was asked to leave. He launched a solo practice, even as he and his new wife were making payments on a $924,000 mortgage on a Chicago townhouse that now has an estimated value of $691,000.

By 2010, McLauchlan had tapped $806,000 of his retirement funds and estimated his remaining assets would be gone in four months, the Am Law Daily says.

In the Illinois appellate opinion (PDF) issued earlier this month, the court upheld a trial judge’s decision to reduce McLauchlan's alimony payments to 20 percent of his income, retroactive to 2008. McLauchlan had sought to terminate the payments entirely. The appeals court agreed with Mclauchlan, however, that the trial judge had wrongly included his retirement withdrawals as income in calculating maintenance.

McLauchlan's lawyer, Howard London of Beermann Swerdlove, summarizes McLauchlan’s problems in an Am Law Daily interview. “This case," he says, "is a perfect illustration of what happens when divorce meets recession meets downsizing."

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