Legal News

Law Firms with Deep Wall Street Connections are Suffering ? Sort Of

By Nathan Koppel

It’s earnings-report season at corporate law firms — or at least what passes for financial transparency in our world.

The Am Law Daily reports financial figures for three of the industry’s giants, and — surprise, surprise — the numbers ain’t pretty.

Sullivan & Cromwell’s partners earned $2.9 million on average last year, a 3.7 percent decline from 2007; Skadden Arps’s partners were forced to scrape by last year with average profits of $2.06 million (a 9.5% decline); and Davis Polk took an even bigger hit, with average partner profits dropping 17%, to $1.9 million.

This does not need to be said, but it’s cathartic nonetheless: We could all use down years like that.

Gross revenue at the three firms, meanwhile, ranged from flat to slightly up. “A pattern is beginning to emerge,” Am Law Daily says. “Firms that traditionally relied on a high-flying Wall Street client base are feeling the effects of 2008’s upheaval more acutely on the bottom line than the top.

We’ll go ahead and add Dewey & LeBoeuf to the mix. Its average partner profits inched up ever so slightly to $1,576,000 (from $1,573,000), according to an email release from the firm; a level of disclosure that still astounds those of us who came of age in an era when law firm finances were, to quote the old Charlie Rich song, behind closed doors.

Here’s a You Tube video of The Silver Fox singing it like only he could.

Full post as published by Law Blog - WSJ.com on February 12, 2009 (boomark / email).