Lehman’s Impact Stretches from Corporate Lawyers to Litigators
It’s not just corporate lawyers who fear the ripple effect from the Lehman Brothers bankruptcy. Litigators and plaintiffs lawyers are also worried.
New York law firms dominate the market because of their work for investment banks. They fear turmoil in the financial markets could lead to more bankruptcies and new regulations that restrict hedge funds and the business they bring to law firms, the New York Law Journal reports.
“There’s a tremendous amount of instability,” the managing partner of one top New York law firm told the publication. “It’s a question of whether you’re fortuitous enough to be representing a financial institution that survives or whether you represent one that’s not going to be around much longer.”
Simpson Thacher & Bartlett was Lehman’s primary firm for underwriting and M&A advisory work, the publication says. Cadwalader, Wickersham & Taft had represented Lehman in its offerings of mortgage-backed securities.
But the impact isn’t limited to corporate lawyers. Securities class action law firms generally seek the largest recoveries from banks they accuse of aiding in corporate fraud. Now they will have fewer targets.
Litigators are also affected. Paul, Weiss, Rifkind, Wharton & Garrison defended Lehman in 32 matters since 2003, the Am Law Daily reports. Jones Day handled 33 matters in that time frame, DLA Piper handled 17, and Heller Ehrman and Morgan Lewis each worked on 16.
Alan Pomerantz, the partner in charge of Orrick, Herrington & Sutcliffe’s New York real estate practice group, said in an interview yesterday that the “incredibly shrinking market” for legal work will mean a tight job market. “If I was a law student or summer associate right now, I would be very nervous.”
