Posted Nov 09, 2009 07:42 pm CST
The declining economy is good news for boutique law firms handling business bankruptcies.
“Bankruptcy boutiques across the country have been quietly booming in this economy as bankruptcies and workouts soar,” according to Portfolio.com. “Unlike large law firms which have been pummeled by the recession, forcing them to fire lawyers and entirely rethink established business practices, these smaller bankruptcy shops say the current economy is actually an opportunity to shine.”
While most large law firms have bankruptcy practices, they are unable to handle some cases because they also represent large financial institutions, creating a conflict of interest, the story says.
Peter Roberts, a partner with 25-lawyer Shaw Gussis Fishman Glantz Wolfson & Towbin in Chicago, told Portfolio his law firm began to seeing more business about six months ago from financially troubled smaller and middle-market businesses. “The banks … have turned their attention to the smaller loans in their portfolios,” he said.
Harold Murphy, the head of the bankruptcy and financial restructuring practice at 31-lawyer Hanify & King in Boston, said Chapter 11 filings are already up and will probably increase over the next year.
“Bankruptcies are a lagging indicator. They generally peak near the tail end of a recession, rather than leading the recession,” he told Portfolio.com.
The article says other bankruptcy boutiques include Craig & Macauley in Boston and Warner Stevens in Fort Worth, Texas.