Dewey & LeBoeuf files for bankruptcy

New York /
May.May 29, 2012 08:30 AM

Dewey & LeBoeuf filed for bankruptcy yesterday, the New York Times reported, more than two months after reports first emerged that the huge law firm, with one of the largest real estate practices in the city, faced financial distress. Filed in federal bankruptcy court in Manhattan, the bankruptcy calls for the firm to keep 90 employees on staff to assist in the liquidation of the business. At its peak, the firm employed more than 2,500 people in 26 global offices. The firm has $315 million in liabilities, $225 million of which is owed to banks.

The filing winds down a tumultuous year for the firm, that has seen a mass exodus of its top legal talentincluding Stuart Saft, the firm’s former global head of real estate — as it became clearer they wouldn’t be paid millions of dollars of compensation they were owed.

The struggles of the firm have been traced to the merger between Dewey Ballantine and LeBoeuf, Lamb, Greene & MaCrae in 2007 and the subsequent financial crisis.

“Because the partnership lacks any shared cultural values or history, money becomes the core value holding the firm together,” said William Henderson, a law professor at Indiana University who studies law firms. “Money is weak glue.”

Legal experts quoted by the Times said the downfall of such an influential firm is “unprecedented.” [NYT]


Related Articles

arrow_forward_ios
Photo illustration of Brookfield Property Partners’ Brian Kingston (Brookfield, iStock)
Struggling hotel company handing Brookfield the keys
Struggling hotel company handing Brookfield the keys
(iStock/Illustration by Kevin Rebong for The Real Deal)
Developer Tomer Dafna hit with involuntary bankruptcy petition
Developer Tomer Dafna hit with involuntary bankruptcy petition
AMC CEO Adam Aron (Getty, iStock)
AMC reopens 90% of U.S. theaters
AMC reopens 90% of U.S. theaters
Washington Prime Group CEO Louis Conforti (Twitter, iStock)
Mall owner Washington Prime Group prepares for bankruptcy
Mall owner Washington Prime Group prepares for bankruptcy
Ascena owns Ann Taylor, Lane Bryant, Lou & Grey and Cacique. (Getty)
Ascena restructuring approved post-bankruptcy
Ascena restructuring approved post-bankruptcy
The bankruptcy filing was made to protect the value of the Denizen. (The Denizen)
All Year LLC opts for bankruptcy to stop Bushwick foreclosure
All Year LLC opts for bankruptcy to stop Bushwick foreclosure
David Umansky of Civic Builders and 720 Livonia Ave in Brooklyn (Photos via Google Maps, Civic Builders)
Charter school developer buys Brooklyn site out of bankruptcy
Charter school developer buys Brooklyn site out of bankruptcy
Rui Barros, former head of Quarters in the U.S. and Esther Bahne, CEO of Quarters. (Getty, LinkedIn via Rui Barros, Quarters)
How Quarters’ $300M US expansion ended in bankruptcy
How Quarters’ $300M US expansion ended in bankruptcy
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...