Thacher Proffitt, 160-Year-Old Law Firm, to Close (Update2) By Lindsay Fortado Dec. 23 (Bloomberg) -- Thacher Proffitt & Wood, a 160-year- old New York-based law firm, will close down after the subprime crisis slashed demand for its structured-finance practice and more than half of its attorneys left for a competitor. Thacher Proffitt will wind down operations next year after its planning committee failed to reach a merger agreement with an unidentified firm over the past six months, according to a company statement yesterday. It is the fourth U.S. law firm to announce plans to close this year. âAlthough many avenues for a merger were explored, in the current economic environment it became apparent to the committee that a merger could not be executed,â Thacher Proffitt said in the statement. âIn light of severe reductions in revenue, it became clear that Thacher Proffitt would not have the financial resources to continue business operations.â Dozens of law firms have cut lawyers and staff in the past year, mainly in structured finance and real estate. Thelen, a San Francisco firm that was, like Thacher Proffitt, focused on structured finance, has shut down. Heller Ehrman, a 118-year-old firm that once boasted about 700 lawyers, also collapsed from a lack of business. A group of about 100 Thacher Proffitt lawyers, including 40 partners, will join Chicago-based Sonnenschein, Nath & Rosenthal Jan. 1, bringing that firmâs total number of lawyers to about 800, Sonnenschein said in a statement. They include Paul Tvetenstrand, Thacher Proffittâs managing partner, and Robert McCarthy, the firmâs chairman of the planning committee. 195 Lawyers Thacher Proffitt, which had about 195 lawyers before the departures, put up for sublease all five floors of its headquarters during the past six months. The firm, which signed a 15-year lease in November 2002, had been among the first companies to take space at the World Financial Center in Manhattan following the Sept. 11 terrorist attacks. In October, the firm closed its White Plains, New York, office. The firm has faced a decline in business since the subprime-mortgage market began to collapse, halting work in structured finance and real estate, two of its largest practices. It has cut jobs in those two areas. âThis is an extraordinary move for our clients,â McCarthy said yesterday in Sonnenscheinâs statement. âWith financial markets evolving and governments playing a greater role in the global economy, our move to Sonnenschein gives us the edge to excel with the industry leaders we serve.â Founded in 1848 Thacher Proffitt, founded in 1848 at 29 Wall Street, developed a specialty in mortgage securities, real estate and banking in the 1970s, according to its Web site. Its clients have included the Federal Deposit Insurance Corp., Lehman Brothers Holdings Inc., Deutsche Bank AG and Bank of New York Co. âThe firm helped develop many of the standard financial tools of the mortgage securities market and has impacted the field such that the standard form of mortgage loan participation agreement is still known to Wall Street as the âTP & W form,â â Thacher Proffitt said on its site. Thacher Proffitt had as many as 350 lawyers before the subprime crisis. The head of the its litigation practice, Richard Hans, and the head of its white-collar crime and government investigations practice, Patrick Smith, left to join DLA Piper, DLA Piper said yesterday. Some Thacher Proffitt lawyers who are moving to Sonnenschein were hired by the U.S. Treasury Department on Dec. 10 to assist in investing in entities by purchasing asset-backed securities under the Emergency Economic Stabilization Act, according to a statement by the department last week. The attorneys will be paid as much as $500,000 for the work, according to the statement. âTumultâ in Markets Sonnenschein is also facing slowing demand for legal services. The firm has fired 62 lawyers and about 175 staff since May due to âtumult in the financial marketsâ and its effect on clients, according to a memo Chairman Elliott Portnoy sent to attorneys in October. The new hires will double the size of the firmâs New York office. New York-based Dreier became the third large law firm to close down this year. It filed for bankruptcy protection after its founder was jailed and accused of cheating hedge funds out of more than $100 million. Firms that cut jobs because of the economy include New Yorkâs Dewey & LeBoeuf; Proskauer Rose; White & Case; Cadwalader, Wickersham & Taft; San Franciscoâs Orrick, Herrington & Sutcliffe; and Chicagoâs Mayer Brown and Katten Muchin Rosenman. Thacher Proffitt had revenue of $194.5 million in 2007, up 1.6 percent from 2006, according to the American Lawyer, a trade publication. Partners made $1 million on average last year, a 22 percent drop from the previous year.
Some elimination is certainly welcomed..... Another 95% to go..... The US would be far better off..... Good riddance..... To the Scum of the Earth...... ......................................................................... Lawyers are learning fast that in deflationary times.... Paper and ink..... Are worth $0..... ................................................................. By the way..... The big winners in the Madoff Case ? Lawyers.... Vultures on dead meat.....