Storied Canadian firm to begin 'orderly wind-up' but some offices and practices will stay in place
A major Canadian law firm that has lost dozens of lawyers recently announced Wednesday night after a partner meeting that it will begin an “orderly wind-up.”
However, there will be no interruption in client service, and a number of Heenan Blaikie practice groups and offices will continue to operate under a new banner, the firm said in a written statement. Some lawyers in the firm’s western offices reportedly are trying to arrange for the acquisition of their group by another large firm.
Although leaders said the storied law firm is still on solid financial footing, it was not able to continue after lawyers headed for the doors when told several weeks ago that income per partner was down about 10 to 15 percent, according to the Vancouver Sun.
This is the largest firm ever to fail in Canada, reports the Globe and Mail.
The Ottawa Citizen and the Wall Street Journal Law Blog (sub. req.) have stories.
A fundamental shift in the legal industry in recent years has affected major firms in both Canada and the U.S. following the economic crisis that began in 2008, putting firms under pressure from clients to keep costs down just as reduced corporate deal-making, enhanced legal technology and globalization increased the competition for legal work. Hence, Heenan Blaikie is not alone in finding that its business model no longer is a good fit for the new legal economy, Toronto lawyer and author Mitch Kowalski told the Citizen. He is the author of Avoiding Extinction, Reimagining Legal Services for the 21st Century,
“This is the start of massive disruption in the legal services industry in Canada,” Kowalski predicted. “We’re going to start seeing more firms have these kind of difficulties.”
In a written statement provided to news media Wednesday night, Heenan Blaikie said the firm’s decision to end operations “follows an in-depth analysis of the available restructuring options in the current context of Canada’s legal services market. An orderly wind-up will make it possible to continue serving the firm’s clients without interrupting or disrupting service and to ensure a harmonious transfer of their files to other law firms. It should be noted that several practice groups and even entire offices will continue to operate under new names.”
Until recently the 40-year-old firm had over 500 lawyers on its roster, but an exodus began after the announcement that firm revenue had dropped and over two dozen lawyers exited on Wednesday alone, the Globe and Mail reported. Nearly one-third of the lawyers in Heenan Blaikie’s Ottawa office left last weekend, the Citizen says.
“Heenans was the firm where everybody wanted to work. The best and brightest would come,” founding partner Donald Johnston, who left in 1978 to become a member of parliament, told the Globe and Mail. Although partners with a book of business will have little difficulty landing spots at other firms, “there are going to be a lot of young lawyers who are going to have to find other jobs,” Johnston said.
See also:
ABAJournal.com: “Major Canada firm makes staff layoffs, plans restructuring amidst attorney defections”
