Thelen Chair Blames Failed Merger on 'Juxtaposition of Circumstances'
Thelen chairman Stephen O’Neal is defending the 2006 merger that has been identified as one of the reasons his law firm dissolved.
O’Neal has faced lots of criticism since the dissolution announcement. He has been targeted in particular for overseeing the merger of his firm, Thelen Reid & Priest, with Brown Raysman Millstein Felder & Steiner. Critics said Brown Raysman carried too much debt and specialized in practice areas that did not meld well with Thelen’s marquee construction group.
In an interview with the National Law Journal (sub. req.), O’Neal also focused on Brown Raysman’s practice areas, but he didn’t see the problem as a lack of synergy. Instead, he said Brown Raysman’s large capital markets practice was hit hard by the economic downturn that followed the merger. The economic “juxtaposition of circumstances” led to the failure, he said.
“That was the largest law firm merger in the U.S. in 2006, and one of the largest practices that came to our firm was structured real estate finance and other capital markets,” he said. “Some eight months later, the credit crunch, which became the credit crisis, struck, and a lot of practices, including ours, were very, very deeply affected by that. And that economic problem, which then led to the larger economic problem that our country and our world found itself in, coming on the heels of doing such a large merger, was just a juxtaposition of circumstances.”
He told the NLJ that dissolving the firm was a “very difficult decision.”
Thelen’s former chairman, Richard Gary, now a legal consultant, has criticized the merger and also said the firm suffered from a lack of strong leadership. “I believe that with strong leadership and a core group of partners committed to saving the firm because they want to practice law together, that no firm has to fail,” he told the Daily Journal in late October.
Howrey announced yesterday that O’Neal will be joining the law firm along with more than 40 Thelen lawyers.