Biglaw

Largest Law Firm In China Looks To Absorb Struggling American Firm

CKR may be making a deal with a global behemoth.

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CKR Law has had a pretty bad couple of months. First, cash flow problems came to light that the firm claimed to be on top of, but tipsters have continued to report that partners have not been getting their full draws — some say for months — as the firm continues to lose attorneys seeking greener pastures. Then the firm was sued for allegedly operating a “sexually hostile work environment.”

While observers wondered if CKR would survive the summer, it appears they’ve been thrown a tentative lifeline. Whether or not the numbers ultimately work out remains to be seen.

CKR just announced that Yingke, the largest China-based law firm, has agreed in principle to take on the firm and create “YKR” a U.S. firm with around 10 offices.

If Yingke really goes through with this verein-like deal, it would mark a significant contraction for CKR. The firm currently boasts around 20 U.S. offices and 31 foreign offices which are numbers considerably bigger than “10.” It’s unclear what would happen with all those attorneys in offices that miss out when Yingke partners with the rump of CKR. In any event, despite the rosy press release language, it’s hard to see this proposal as anything but a survival play for CKR, trying to secure an infusion of capital and a massive downsizing effort to get back on solid footing. It’s the kind of deal that makes it seem like those cash flow issues were a bigger deal than management officially claimed.

The deal is set to be finalized September 30th if due diligence doesn’t turn up any red flags. For those of us wondering if all the rumors coming out of CKR about a cash flow crisis were true, we’ll know if it really is a minor setback or a genuine existential firm crisis if Yingke pulls out of this in the Fall.

CKR Law and Yingke Law Engaged in Discussion to Create New Legal Practice in U.S. [Newswire]

Earlier: Global Law Firm Facing Cash Flow Problems, Considering Terminating Partners
Biglaw Firm Faces Allegations Of A ‘Sexually Hostile Work Environment’

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HeadshotJoe Patrice is a senior editor at Above the Law and co-host of Thinking Like A Lawyer. Feel free to email any tips, questions, or comments. Follow him on Twitter if you’re interested in law, politics, and a healthy dose of college sports news. Joe also serves as a Managing Director at RPN Executive Search.

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