Weil, Gotshal & Manges partners approved an orderly wind-down plan following a high-profile partner exodus that left the 95-year-old New York corporate powerhouse unable to sustain its $2.1 billion in annual revenue.
The collapse marks a historic fall for a firm that helped define modern corporate restructuring through landmark cases like Lehman Brothers and Enron. Management announced the decision after merger talks with Willkie Farr & Gallagher collapsed in late October.
The unravelling accelerated in September when corporate chief Michael Aiello departed for Cravath, Swaine and Moore alongside five other M&A partners, according to ION Analytics. Aiello brought a book of business estimated between $100 million and $150 million, per reporting from Original Jurisdiction.
Longtime leader Barry Wolf was set to relinquish control in a transition that faced internal friction, leaving the firm vulnerable in a white-hot lateral hiring market. This is really a case where you had a run on the bank and people didn’t want to be the ones left at the firm,
said Eric Greenberg, general counsel of Cox Media Group, as reported by Business Insider.
Kent Zimmermann of the Zeughauser Group said that top competing law firms and partners with portable practices watch closely when firms experience uncertainty. This is a sign of the times for law firms,
Zimmermann said.
The wind-down leaves approximately 1,200 lawyers and hundreds of staff facing sudden job searches, with incoming associates having future job offers rescinded. Bruce MacEwen, president of Adam Smith, Esq., called the rapid decline of a firm the size of Weil Gotshal & Manges in a non-recessionary environment unprecedented.
Employees were told during a 30-minute Zoom call that they will receive salary and benefits for 90 days, with eligibility for year-end bonuses if they remain through the transition, according to details shared with The Indiana Lawyer. Legal recruiters like Evan Fox of Long Ridge Partners reported a surge in interview scheduling for displaced Weil attorneys.
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