The
article excerpted below discusses the folding of a top LA bankruptcy firm. Along
with Weil’s recent layoffs, it appears that these firms just don’t see a ton of
the most highly profitable work on the horizon. With consolidations and
shake-ups at the top, I wonder what the market looks like for the smaller fish
in smaller markets.
(Reuters) - The well-known Los Angeles-based bankruptcy law firm
Stutman Treister & Glatt, which once advised on the Chapter 11 proceedings
of companies including Lehman Brothers and Enron Corp, has announced it is
closing.
"We're in an economy that has had a
significant dropoff in Chapter 11 activity," Stutman shareholder Jeffrey
Davidson said in an interview on Tuesday.
Bankruptcy lawyers say the shuttering of Stutman, scheduled to take
effect on May 1, marks the latest sign that a downturn in Chapter 11
proceedings has hit the top U.S. bankruptcy law firms.
Chapter 11 filings fell by 36 percent between 2010 and 2013, from
15,251 filings to 9,811, according to data on the United States Courts website.
Stutman's Davidson said companies that previously would have filed for
bankruptcy now opt for refinancing because of lower interest rates offered by banks.
That, in turn, hurt business for bankruptcy lawyers, he said.
The major New York law firm Weil Gotshal &
Manges cited a downturn in bankruptcy work, including business associated with
its role in guiding Lehman Brothers through Chapter 11, when it laid off 60
junior lawyers and 110 support staff in June 2013.
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