Update: Powell Goldstein’s Internal Response to Bryan Cave Acquisition
We reported earlier that Powell Goldstein is set to be acquired by Bryan Cave. We’ve been told to expect an official announcement from Bryan Cave on Monday.
PoGo has still not directly responded to ATL about the rumors that a number of associates, staff, and partners could be on their way out of the door. But we understand that they have sent around an internal email addressing some concerns in light of the merger information. A tipster tells us that the email offered the following clarifications:
1) Everyone has a job. This is a specific term of the deal.2) BC wants to expand the Atlanta office. …
3) We have no problems at all with our finances. Credit is strong, bank relationships are strong, etc.
We have not gotten our hands on the merger agreement between PoGo and Bryan Cave. But the “promise” that every job is secured is encouraging. The email does not speak to our previous reporting that PoGo’s banks threatened to pull their credit line if a merger was not reached. But regardless of what could have happened, the firm’s contention that they are in a strong financial position is certainly worth noting.
The Chairman’s conference call after the jump.
If there are “no problems at all with [PoGo’s] finances,” then why merge with Bryan Cave?
We understand that the firm chairman is speaking to associates right now. According to the chairman, the conference call is being held in response to this morning’s coverage. (we do appreciate it when our posts have an “information forcing effect.”)
Based on the real time reports we are getting, the chairman is telling associates that Bryan Cave convinced PoGo to break off merger talks with Nixon Peabody. Apparently BC and PoGo together would have ranked 45th on AmLaw’s revenue list. The chairman also claims that the cultures and core values of the firm are nearly identical. In addition, the chairman reports:
PoGo’s Atlanta office will have a lot of opportunity to grow significantly due to this deal.
Sound like a convincing reason to merge? The chairman is also saying that the new firm:
For a period of time we’ll be known in Atlanta as “Bryan Cave Powell Goldstein” to maintain southern name recognition for a while and then eventually phase-out.
According PoGo’s chairman, ATL’s suggestion that layoffs are a possibility is: “absurd,” “wrong,” and “offensive.” We’ll note, again, that PoGo did not choose to make this point when we spoke with them yesterday. Nonetheless, the chairman contends that:
BC’s first draft of term sheet was that every employee of PoGo would stay… we renewed our line of credit in March and that is an almost 100-year relationship with the bank.
In closing, the chairman adds:
The blog could not be further off-base.
We’ll see.
But we’d be happy to see that the specific deal term guaranteeing every PoGo employee their job after the merger, especially if it still exists in the final draft of the deal.
Good luck PoGo. As our optimistic tipster put it:
So, while the name is on its way out, the firm isn’t going anywhere because we are a community of actual people. We’ll just have some new stationery, a way cooler website, more partners practicing law instead of “administrating.”
That would be a very good thing.
(85) Comments
Comments
Anybody else notice both BC and PG have similar logos?
FirsTTTTTTTTTTT
FIRST!!!!!!!!!!!
pretzels
ppphirsttt
FirsTTTTTTTTTTT
Bryan Cave=TTT?
y/y?
Sounds like ATL should acknowledge that the "layoff madness" got the best of the site, and should perhaps be a bit more conservative in what it initially reports.
I've dealt with attorneys from both firms. Was not impressed.
But what about bonuses? This time of year, that's all we want to talk about ... understood? Good!
I think Bryan Goldstein sounds even more credible.
FIRST!!!!!!!!!!!
12 - You suck. Go comment at Prawfsblog if you're that needy for validation.
BC's logo could be a reference to the st. louis arch (firm HQ in StL) but what's PoGo's excuse?
10 - wake up its the year of the "no bonus"
10 - Go read NYlawyer.com...theres two articles on bonuses that came out five minutes ago...
If POGO could pull off a merger, what happened with Heller and Thelen? Both Heller and Thelen seem comparable (if not greater in revenue, prestige, practice groups) to POGO? Management really dropped the ball there.
This is all spin by PoGo. Everyone in the Atlanta legal community knows that PoGo was in real trouble and that this is a life preserver for the firm. Of course the Chairman is saying good things; what would you expect. But the reality is really that PoGo has been hurting, and is still not necessarily out of the woods by merging/being acquired by a mid-tier St. Louis firm with its own issues. Time will tell, but if I worked at PoGo, I'd still be looking for a safer spot.
elie mysTTTal
Dear ATL:
Please quit posting shit that you have no idea of its accuracy. This is terrible. You get everyone worring about getting laid off when you should be getting laid off for reporting this and mantaining a website that has crumbled faster than the economy.
Sincerely,
Bama Gal.
18 - You're right on. I used to work at PoGo, and I've been hearing for months that the firm is in trouble, particularly the transactional practice (they've lost several key partners in Atl. and DC). I hope the merger works and everyone can keep their jobs. It's a bad time to be a lawyer out of work.
20 - I think most here would agree that this is exactly what we've been asking for. I want to hear about events that reflect on the business realities of the legal practice, even if it's mostly speculation. This is random legal blog, it shouldn't be relied on to only post things that are proven indisputably.
20 - I think most here would agree that this is exactly what we've been asking for. I want to hear about events that reflect on the business realities of the legal practice, even if it's mostly speculation. This is random legal blog, it shouldn't be relied on to only post things that are proven indisputably.
I agree with you 9. My experience has been that they are not as smart as you.
Information forcing Effect, not Affect.
22 and anxious 23:
I totally agree. I did not say "proven indisbutably." All they had to do was wait maybe 2 hours and they would have had the facts. That is all I am saying. Quit jumping all over shit they may have heard. I mean I could probably send them an email and they would post the story without any fact checks. If you notice, it seems that Elie and Kash are ALWAYS having to update a post because they jump the gun.
Sincerely,
Bama Gal.
P.S. --you only have to post once. Because it is there twice doesn't make it twice as effective.
I hope this works out for everyone at PoGo. Word on the street is that they've been in trouble for some time, as evidenced from partner defections in major practice areas. Bryan Cave is a decent firm. If the merger is on anywhere near the terms that the chairman maintains, everyone at PoGo should be much better off for it.
PoGo's various market strategies have seemed so sound to me -- I mean, why wouldn't corporate America love to have plaintiff libel lawyer Lin ("More Makeup") Wood representing it?
18 -- what issues does bryan cave have
I think the comment that the finances are strong is almost certianly an outright lie. They may not be dire, but they certainly aren't "strong". So, that calls into question the truth of the other two points. Ethos, you know...
Bama Gal here again...
22 and 23, maybe you should work for ATL. You seem to not be patient either...
I lick balls.
Bama Gal
32, I will cut your balls off
29 -- they just bought a floundering PoGo.
signed,
not 18
What's PoGo's culture like? Rather than the usual Biglaw tactic of trying to hide the fact that they are a sweatshop, BC embraces it. At OCI, they asked me what I would do if it was 4:30 on my wife's birthday and a client called with a project that had to be done by 9 the next morning.
I had to laugh at 35's comment. They asked me a similar question at my callback.
Didn't Bryan Cave no-offer a lot of summers?
Bama Girl, you have no idea what you're talking about. This is a tabloid not the NY Times, they deal in rumors.
That said, PoGo is obviously engaged in serious spin. They were floundering for almost a year and word in Atlanta was that they would not survive. Bryan Cave saved them.
Also, while everyone will have a job on day one after the close, I would expect stealth layoffs to occur over the next 6 month period. Firms don't buy struggling firms without cleaning out the inefficiencies. There will be serious evaluations of the "talent" and everyone will need to prove themselves all over again. I know -- I was a lawyer in a firm that merged with a bigger firm and was squeezed out 6 months after the merger closed.
24,
Blow me.
Regards,
9
36, I'm glad I wasn't the only one. I silently cheered when my rejection letter arrived.
-35
35, the correct answer is: "Wife? I'm into dudes."
Also, I read Bondurant is struggling in the earlier thread.
And, finally, where my battered women at?
Thats why this site sucks! They are never right....
Roll Tide...Bama Girl....that's where MY battered women at!
NIttany Lions!
I play the rusty trombone.
Bama Gal
BC no offered me at OCI. I didn't even get an OCI. I hope Bryan Goldstein goes the way of Hellen Theler...
and yes it was intentional.
The South sucks, spreading unsubstantiated rumors (and thereby clearing the air) is all ATL is good for, publishing apologies/retractions/updates with a bit higher humility to snark ratio is a good idea.
The South sucks, spreading unsubstantiated rumors (and thereby clearing the air) is all ATL is good for, publishing apologies/retractions/updates with a bit higher humility to snark ratio is a good idea.
PoGo was trying to get a lifeline from Nixon Peabody too, right? Everybody's a winner at Nixon PoGoldstein.
KS letting people go. 5 in Atlanta, 2 in Charlotte.
50 -- I hear that KS (Kilpatrick Stockton for the clueless) is actually letting more than 5 go in Atlanta.
I also hear that A+B has been stealth firing for the last several months (at least, telling people their time is up)
What about Sutherland -- rumor is that the firm is having a bad year as well, and the economy cannot be helping it.
Nelson Mullins and Motley Rice are also doing stealth layoffs, per the rumor mill.
This PoGo acquisition is a joke -- the idea that PoGo would brag about being in the big leagues because it was acquired by a firm with PPP of $650K just shows how low-end PoGo has become. I'm glad the firm will survive because I know some of the cogs at the firm, but the p.r. spin is just silly. I predict that the office will be smaller than it is today, once Bryan Cave figures out that the partners in its Atlanta office cannot generate business.
It may well be that Bryan Cave wants to grow its new Atlanta office. The problem is that the people in that office have been here for years and haven't been able to grow it. Changing the name isn't going to help them.
What must John Marshall, Frank Love, etc. be thinking about all this? The firm they built into a top-notch regional shop in the 70s and 80s is now gone. It took the current crop of partners a mere 15 years to run the place directly into the ground.
By the way, any word on whether Treasury released some TARP funds to backstop Bryan Cave's losses on Pogo's toxic accounts receivables?
It baffles me how people rely on the "word on the street" as proof that a firm is struggling.
PoGo has trimmed some serious fat in the past two years. Yes, they lost a few profitable partners, but they rid themselves of more fat than muscle. The PoGo today probably looks more attractive to an acquiring firm than the PoGo that was struggling with too many unprofitable partners a few years ago.
Bryan Cave is not a sweat shop. The NYC office is good for NYC offices. But the firms "home" location, St. Louis, brings in all the revenue and gets the most respect. So that is something people should be aware of when considering the firm in any office that isn't based in NYC.
Also, BC did no offer a bunch of summers. But that was just the NYC office. And maybe Chicago too.
56 -- nice try, but I'm not buying. PoGo didn't just lose "a few profitable partners." PoGo lost all of its healthcare practice and many other long time "star" partners to other firms in Atlanta. These partners did not leave on their own -- they took client, business, and often associates. Sure, since then PoGo has trimmed some fat, but that does make the firm stronger, it just short-term improves numbers so that some firm will take the bait. That strategy worked, but the firm is still weak.
Now I know why this site is a "tabloid".
Also, the majority of people that leave comments are just looking to bash other firms.
58: Which firm is still weak...the now 1050+ attorneys 20 office, and national coverage firm. Get with the program.
57, if they aren't a sweat shop, why do they act like they are when they interview people?
-35
Guys at my high school used to bash other firms all time. It was no big deal.
58 -- are you clueless? You think the number of lawyers and offices make a firm strong? Did you graduate from the Heller/Thelen school of management? I guess the weaker firms like Wachtell, Cravath, etc. better start buying crappy firms with low PPP and lots of offices so they can become major players.
The fact that the PoGo firm now has "national coverage" just means the partners in Atlanta can fail to get work in multiple locations now.
True 51, but lastr time I posted actual numbers that a law firm laid off Elie felt the need to come on and try to bitch slap me.
Point is, KS just let go a high enough number to warrant being on here.
Do you get any leads Elie or do you wait for us to provide them on this board?
True 51, but lastr time I posted actual numbers that a law firm laid off Elie felt the need to come on and try to bitch slap me.
Point is, KS just let go a high enough number to warrant being on here.
Do you get any leads Elie or do you wait for us to provide them on this board?
Bryan Cave is very conservative. No debt, getting better about trimming partners that aren't pulling their weight. Not sure what needs fixing at PoGo, but the firm might be able to pull it off. Lucky that it is not adding big market offices. Dallas, Atlanta, etc. could fit well with BC fee structure. Mothership mentality from St Louis might be tough to take for PoGo attorneys used to autonomy.
Talking about firms that are down doesn't make sense without more information. Based on comments that I have heard from friends and lateral candidates, most firms are "down" because some practice groups are not as busy as they have been historically. For example, you might have a Lit group that is going gangbusters but other groups are slow. But when people talk about down, many firms mean profits are not at budget (2007 numbers plus some growth percentage). A Latham lateral was saying that the firm would be somewhere between 2006 and 2007 profits this year. I have heard others at places like Kirkland, McDermott, Jones Day, Arent, say that they should hit 2007 levels. It sounds like things are slow, but partners at those firms made a lot last year so it is hard to say that things are bad. The other thing is that firms seem to have plenty of billings, but collections are slow. I think that is why Morgan Lewis and others will push back bonus decisions until they know how much they really collect. The only firms that you should worry about are the firms that cannot pay their partners.
57 - All Chicago summers got offers
Why do law firms merge?
What are the safe areas to be in? IP, patents . . . What else?
70, it depends on the firm. IP is not safe if you are at a firm that charges a high billable rate, especially for application work, or does not have a deep litigiation team that allows you to charge premium rates but requires a lot of people and a great repution. MoFo and Kirkland have really good IP litigation. Weil and White & Case stole all the IP litigation talent from MWE so they might be good while MWE is living off the fumes of its past reputation or what's left of it after the Medtronic screw up. Patent prosecution can be good at places like Foley with lots of foreign work and lower rates, Sughrue, Arent. Places like Finnegan, Fish are a mixed bag.
Straight up litigation is pretty safe. People are always going to be suing each other.
Pogo's headcount is down by about 100 lawyers from 5-6 years ago. Its PPP has been stagnant for years. Its DC office is a shell of its former self. One of its 2 best practices, healthcare, left in both DC and Atlanta. The Atlanta group took with them the firm's single largest client. It dove head first into CMBS work in Dallas and Charlotte at precisely the wrong time. Oh yeah, it trimmed more fat than muscle. Right.
"Why do law firms merge?"
That is a good question and one I've never really known the answer to. Profits per partner doesn't seem to depend on size (past a certain point, of course).
law firms merge to grow geographically, add practice groups, build up practice groups, build up a client relationship. Depending on the firm's business goals, it can be some or all of these.
56 - PoGo didn't trim any serious fat in the past two years. PoGo was ABANDONED by some serious fat cats.
I like at 77 posts now, this is getting no attention from Above the law regulars....God forbid there is news outside of NY/DC/SF/LA.
OK...lets do a PR and common-sense exercise. Lets say Partner A and Partner B leave Firm 1 with a group of four associates to join Firm 2. What normally takes place in the public domain?
Well....Firm 2 will announce that Partner A and B, formally of Firm 1, have joined Firm 2 w/ associates. Firm 2 will tout in a PR release how the laywers are excellent additions and will make valuable contributions to Firm 2. The outside perception is almost automatically that Firm 1 is struggling and Firm 2 just poached their partners.
But what if really Firm 1 had not been happy with the PPP numbers of either Partner (and perhaps one Partner even fancied being a little too friendly with female associates), so Firm 1 pushed them out the door or at least made it not a desirable environment for either Partner to remain. Firm 1 is actually now better off, but none of this will ever make it to the public domain.
My point is that not all partner defections or losses are bad for a firm. Its just reported that way in the public domain. Sorry Partners...but not every time you leave a firm are the people at the firm sad to see you go. Take everything with a grain of salt.
But lets now say
i'm working for BC next summer. I got asked no such questions.
During my interview, the person from Bryan Cave asked if I ever found any pogo in my poop. I was confused, but now I understand the question.
55 is a long-term insider. John Marshall and Frank Love built a great regional firm, and are great guys. Bad luck and bad management can be blamed a little, but also the fact that the market changed very quickly. People on this board can't be expected to understand.
Which groups at KS are laying folks off? I haven't heard anything about this.
In an article posted on PoGo's web page, PoGo's chairman states that "All of our employees will move over". So if you're an associate or a secretary, sounds like you're in good shape for the time being....
That is, at least until the partners for whom you work--technically not "employees"--walk (or are pushed) out the door soon after the merger becomes effective on Jan. 1 and you suddenly find yourself fighting for table scraps from the survivors with whom you have no prior relationship. Happy new year.
Unsolicited advice for PoGo associates (but only if you want to keep your job): unless you're 100% certain a departing partner would bring you along, now is a really good time to start introducing yourself to BC partners in your practice area.
when bc merged with robinson silverman. the combined headcount in ny was about 220. It is now about 160. That was supposed to be "growth" in NY.
Specific term of the deal was that everyone has a job? Sure, so when Bryan Cave conducted lay offs, which they were most likely certain in November they were eventually going to have to do because there were talk about it internally in November, they only laid off the Bryan Cave people, not the POGO people??? Very nice, very, kind of them to take care of their own.