Biglaw

Dissolving A Biglaw Firm Is Messy Business

It isn't easy when your law firm collapses.

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After finally confirming what many observers had long suspected — that the one-time Am Law 200 firm of LeClairRyan was going out of business — LeClairRyan has now officially embarked upon the process of winding down, and it’s turning into a real situation. The firm informed employees that their last day of employment will be August 30th, and many still left at the firm find themselves scrambling to get their affairs in order.

As reported by Law.com, one area of concern for many is health insurance. Because LeClairRyan has a self-insured plan, when the firm is gone as of September 1, so is employees’ health insurance, and the firm is saying they don’t need to provide Cobra benefits:

The firm has told attorneys that it doesn’t have to provide Cobra benefits to extend their health insurance coverage because it uses a “self-insured” benefit plan and the firm itself is shutting down, according to a lawyer transitioning out of the firm.

“A lot of people are not very happy about it,” the lawyer said. “A lot of people have kids, so we’re going to have to find a catastrophe policy in case one of our kids develops cancer on September 1.”

Many lawyers are also working to wrap up outstanding expenses, move their retirement fund, and send out collections, with accounts receivable reportedly being moved to the firm’s lenders:

LeClairRyan’s bank has taken control of the firm’s accounts receivable account, two sources said. LeClairRyan, in announcing its impending dissolution Aug. 7, stated it was “working in cooperation with its lender to ensure the continuity of client service” until its practice ceased.

Plus, they have to figure out what’s the next step in their legal careers. While part of what precipitated the firm’s demise was a drastic reduction in headcount as partners and senior lawyers departed the firm for greener pastures, not everyone was so lucky as to have their landing place locked down before LeClairRyan announced it was closing its doors. Clark Hill appears to be scooping up quite a few of soon-to-be former LeClairRyan attorneys — after previously hiring a labor and employment group from Los Angeles, they’re now reportedly poised to take on LeClairRyan lawyers in New York, New Haven, Connecticut, and Houston. Lewis Brisbois also looks like a winner in the process, announcing they are hiring 11 attorney, five of whom are partners, from the products liability group.

Best of luck to the LeClairRyan faithful, as they now try to move on from the failed firm.

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headshotKathryn Rubino is a Senior Editor at Above the Law, and host of The Jabot podcast. AtL tipsters are the best, so please connect with her. Feel free to email her with any tips, questions, or comments and follow her on Twitter (@Kathryn1).

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