Law Firms
Lehman’s Impact Stretches from Corporate Lawyers to Litigators
Posted Sep 16, 2008, 05:39 am CST
By Debra Cassens Weiss
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."
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Comments
Posted by Michael - 2 months, 2 weeks, 4 days, 21 hours, 48 minutes ago
There was certainly no shortage of arguably tortuous behavior associated with the Lehman collapse, and various behaviors leading up to it. What’s different—though not mentioned in this article—is that damage awards will likely require approval of a bankruptcy trustee and judge. Business as usual for attorneys on both sides is no longer usual… However, there may be a bonanza for out-of-the-box thinking plaintiffs lawyers and bankruptcy attorneys: the benefits just won’t flow to the usual suspects. I have no idea who is going to pay to defend the cases.
Posted by trumptower - 2 months, 2 weeks, 2 days, 58 minutes ago
Is that supposed to be “tortious” behavior?
Posted by adam - 2 months, 2 weeks, 2 days, 50 minutes ago
Thankfully, proper spelling and grammar have little to do with “outside-the-box” thinking attorneys, eh Michael?
Posted by Raissa - 2 months, 2 weeks, 2 days, 29 minutes ago
interesting in light of yesterday’s discussion
Posted by DCEsq - 2 months, 2 weeks, 1 day, 22 hours, 28 minutes ago
Personally, I have little sympathy for these lawyers, whose careers are organized around the principle of law as a business rather than a profession (or what is sometimes known as “a calling”). If lawyers are in it for the money, they should consider this current downturn as a decline in the market. In the end, there is little to distinguish the trading of law firms for higher salaries from the trading of securities on Wall Street. Although this article ultimately disappointed in terms of providing any food for thought, it did remotely hint at the possibility that even one question might be raised about the responsibility of corporate lawyers for the transactions that have caused the market’s condition to deteriorate so precipitously.
Posted by Colette - 2 months, 2 weeks, 1 day, 22 hours, 16 minutes ago
I’m glad I have a sole practice in a small town!
Posted by phone it in - 2 months, 2 weeks, 1 day, 20 hours, 34 minutes ago
Uh…DCEsq. You’ve said that same comment to like four articles. We got it…law’s a calling; money bad. Sounds like you missed your calling to the pultpit. I got to go…the phone in my beemer is ringing. I wonder who’s calling?
Posted by DCEsq - 2 months, 2 weeks, 1 day, 17 hours, 23 minutes ago
Hey “phone it”! Greetings to you. I wonder if you realized the possibility of a reader just hitting one of these articles, since they’re all rather repetitive themselves, yes? I just wanted to make sure that one discriminating reader received the message. How wonderful of you to be as thorough in your reading as I am. Elementarily Yours, DCEsq.
Posted by LocalNC - 2 months, 2 weeks, 17 hours, 48 minutes ago
Last I heard if you do work you get paid for it in any profession. People pay for services which they can not do themselves. Try not to be to high and mighty and realize law school was expensive and pro bono does not pay the bills!
Posted by Esq - 2 months, 1 week, 5 days, 21 hours, 11 minutes ago
Of course this could be a criminal lawyer’s bonanza as well. And yes, it is my calling.
Posted by DAP - 2 months, 1 week, 4 days, 22 hours, 38 minutes ago
Just don’t practice in new York…the rest of the country is handling quite well (said while excluding M&A’s, banking law and related fields). Healthcare law is still churning away beautifully.