Posted Apr 27, 2012 06:51 pm CDT
Updated: The onetime leader of troubled law firm Dewey & LeBoeuf lost his lock on the chairman’s office in March, when four other lawyers were appointed to help him run the law firm.
Steven Davis was said at the time to have co-equal powers with the four other lawyers. He would be moving to London to focus on the firm’s international offices, the reports said. But Davis hasn’t been seen in London, the Am Law Daily reported Wednesday. And the new leadership team has fallen silent.
But someone is talking to Law360 (sub. req.) and Bloomberg News, and the reports suggest the rift at the troubled BigLaw firm has reached an unprecedented level. Law360, relying on an unnamed source, says a group of discontented partners called the New York County District Attorney’s office seeking a criminal probe of Davis. And Bloomberg, also relying on an unnamed source, is reporting the DA has begun a preliminary criminal probe involving the law firm.
The New York Times Dealbook blog reported Friday that the firm sent a memo to partners acknowledging an early-stage investigation. The firm also has launched its own investigation of alleged financial improprieties, the Times reported.
A probe at the preliminary stage means there has been no determination whether any crimes were committed. Davis has not returned ABA Journal requests for comment.
According to the Law360 account, Dewey lawyers were surprised to learn at an October partner meeting that Davis signed more than 100 contract guarantees for some partners, including his friends, apparently without any management oversight. The source also alleged that Davis cashed out his personal capital in the firm in violation of contract agreements.
Bloomberg’s story says investigators are examining whether managers misled partners about payments due them.
Erin Duggan, a spokesperson for the Manhattan District Attorney’s office, declined to comment when contacted by the ABA Journal. And Dewey spokesperson Angelo Kakolyris didn’t immediately return an ABA Journal phone call seeking comment.
Last updated to add New York Times coverage.