Biglaw, Lateral Moves, Law Firm Mergers, Midsize Firms / Regional Firms, Musical Chairs, Partner Issues, Partner Profits

Riding To The Rescue Of A Troubled Law Firm

Last month we wrote about a Biglaw firm that’s in big trouble. The firm in question: Dow Lohnes, a former Am Law 200 firm that has been hemorrhaging lawyers and clients (and lost two more partners last week, to Venable). In our story about Dow Lohnes, we noted that “[i]t seems possible that the firm could merge out of existence — if it’s lucky enough to find a partner.”

Fortunately for the remaining lawyers and staff at Dow Lohnes, the sinking ship has located some lifeboats. A larger and stronger firm, a member of the Am Law 50 and Vault 100, will be picking up many (but not all) of Dow Lohnes’s lawyers.

Who’s the white knight riding to the rescue of Dow Lohnes?

(Note the UPDATES added at the end of this post.)

Reports Casey Sullivan of Thomson Reuters (via WestlawNext Practitioner Insights (sub. req.)):

The technology law firm Cooley will merge with the smaller Dow Lohnes, taking over many of its Washington lawyers but not those in Atlanta, according to Cooley’s CEO.

Fifty-four lawyers and 20 other professionals will join Cooley’s Washington office to form a regulatory practice servicing the higher education, media, technology and communications industries, said Cooley CEO Joe Conroy.

Cooley will not hire Dow Lohnes lawyers in the Atlanta office, Conroy said, although it will assume Dow Lohnes’ lease obligations.

Dow Lohnes managing partner John Byrnes will sit on the Cooley compensation committee for two years, Conroy said, and be an observer of the firm’s management committee, but not a member.

The new firm will retain the name Cooley LLP.

Of course the firm is keeping the Cooley name. This is less of a merger and more of a mercy, with Cooley kindly picking up many (but not all) of Dow Lohnes’s lawyers. It’s similar to, say, Sonnenschein’s rescue of about 100 lawyers from failing Thacher Proffitt & Wood.

Also note how many Dow Lohnes folks are not making the move to Cooley. According to Thomson Reuters, Dow Lohnes has 93 lawyers and other professionals, but only 74 people are joining Cooley. Perhaps many of the 20 or so who are not getting rescued are based out of Atlanta, where Cooley will not be hiring lawyers (and does not currently have an office, even though it’s picking up the Dow Lohnes lease for some reason).

Apparently Dow Lohnes had other suitors:

Dow Lohnes has been in merger discussion with several law firms, according to at least four sources familiar with the matter. One source said the firms included Sheppard Mullin Richter & Hampton, Baker & McKenzie, and Manatt Phelps & Phillips.

Cooley does seem like a good home for the Dow Lohnes D.C. team. The Cooley press release stresses how the Dow Lohnes lawyers will enhance Cooley’s existing strengths in regulatory, communications, and technology work. The transaction will take effect on January 1, 2014, and the new firm will have around 750 lawyers. In the latest Am Law 100 rankings, Cooley ranked 47th, with revenue of $617 million; perhaps the pickup of the Dow Lohnes lawyers will send Cooley higher next year (at least in the Am Law 100 rankings, which are based on total revenue; it’s not clear what the Dow Lohnes deal will do to profits per partner, where Cooley clocks in at #40, with PPP of $1.49 million).

Congratulations to the Dow Lohnes lawyers and staff who will be making the jump to Cooley. If anyone has information or insight on how this transaction will affect Cooley, feel free to email us or text us (646-820-8477).

UPDATE (4:15 p.m.): More about the move from The BLT, which notes that after absorbing Dow Lohnes’s D.C. office, Cooley will have about 130 lawyers in Washington, making it one of the 35 largest law offices in the nation’s capital.

UPDATE (10/16/2013, 9:45 a.m.): Here’s coverage from the Washington Post, which notes that the Atlanta lawyers and staff of Dow Lohnes will need to find new jobs before the end of the year.

Cooley Expands in DC with Dow Lohnes Merger [Cooley LLP (press release)]
Cooley CEO says firm to combine with Dow Lohnes [WestlawNext Practitioner Insights (sub. req.)]
Lost and Found: Dow Lohnes Loses Pair, Lands Deal Work [American Lawyer]

Earlier: A Biglaw Firm That’s In Big Trouble

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