Legal Business

US worst hit as Cadwalader becomes latest firm to respond to Covid-19 with pay cuts

Cadwalader, Wickersham & Taft has become the latest firm to take drastic financial measures as the Covid-19 pandemic reaches new heights suspending partner pay and cutting salaries elsewhere. 

The move comes as the number of confirmed cases of the virus in the US soared to nearly 200,000 today (1 April) and the number of deaths reached 4,000. Cadwalader will stop paying partners, reduce associate salaries by 25% and impose pay cuts of 10% to 25% on staff to mitigate the economic impact of the crisis as it hits businesses around the world. 

It follows the news on Monday (30 March) that Womble Bond Dickinson has made redundant some US employees and imposed temporarily pay cuts on the rest of its US staff in response to crisis. The firm said it made the ‘hard decision to furlough some selected employees and let go another small group’ in response to the pandemic. ‘In addition, we are temporarily instituting a 10% or less pay reduction (with lower levels of compensation reduced by smaller percentages) for our remaining staff and attorneys.’ The 10% pay reduction applies to those making more than $100,000.  

Cadwalader’s measures will take effect today and will last for four months. According to Above the Law, managing partner Patrick Quinn said in an internal note that firm leadership placed a high priority on protecting the jobs of staff, both legal and non-legal and so the first priority was to do its best to avoid any layoffs. 

The economic toll has so far been higher for US law firms, with Allen & Overy(A&O) and Reed Smith among the international firms to take less drastic measures so far. 

A&O’s steps included altering profit distribution to partners, increasing partner capital levels and freezing some investments and recruitment. Reed Smith’s contingency involvedringfencing a portion of its cash reserves against partner distributions as the crisis unfolds, with monthly drawings reduced by 40% for full equity partners and 15% for fixed share partners globally. 

Legal Business

Cadwalader London revenue down again despite strong global performance

Cadwalader, Wickersham & Taft has seen its London revenue drop for the second year in a row, falling 4% to $41.3 in 2019.

Following a 13% fall to $43.1m in 2018, the figure is a far cry from the $50m it recorded in 2017 and comes despite the firm posting a solid 9% global revenue growth to $459m.

The firm’s financials announced today (12 February) also show global profits per equity partner at the New York-bred firm rose 11% to hit $3m and revenue per lawyer 7% to $1.2m. The results come as the firm added three to its equity partner ranks to 46 and its lawyer headcount rose 2% to 382.

A second year of global turnover growth following the 3% rise in 2018 will be welcomed as good news for a firm that saw its revenue fall for three consecutive years between 2015 and 2017.

As part of its refocused strategy targeting its core client base of financial institutions, large corporates and funds, the firm cut 15% of its legal workforce in 2017 and has closed a number of its offices over the last few years. In 2018 it shut its Brussels outpost, following the withdrawal from Hong Kong and Beijing in 2016 and leaving London as the firm’s only office outside the US.

But its City outpost, which had outperformed the firm’s global business in previous years by growing its revenue fivefold in the five years to 2017, has recently been hit by a number of departures in its restructuring practice. They included well-regarded Yushan Ng, who at the beginning of 2018 quit for Milbank, Tweed, Hadley & McCloy.

Speaking to Legal Business last year, London head Greg Petrick said the firm had ‘the right strategy’ and was ‘in an aggressive growth mode’, adding that the London office was ‘right at the centre’ of that strategy.

The City base will in the next few months move to new premises at 100 Bishopsgate, with space for up to 150 lawyers: almost double its headcount, which at the beginning of last year stood at 60.

Cadwalader’s financials come after US disputes heavyweight Quinn Emanuel Urquhart & Sullivan yesterday posted an impressive 20% growth in its City turnover, breaking the £100m barrier.

Cadwalader has also had to deal with a claim for indirect sex discrimination brought by a female associate in its London office.

Ana Maria Knott brought a claim in the UK employment tribunal concerning the firm’s policy of not reducing its billable hours target for bonuses to reflect time spent on holiday.

The tribunal agreed that Cadwalader’s policy put women at a disadvantage but Judge Isaacson dismissed the case, saying that the claimant had a choice between ‘taking very generous holiday leave or working more to improve her chance of obtaining the bonus’.

Knot returned from maternity leave in 2018 and was entitled to seven days of statutory minimum leave during the remaining 16 weeks of the year, but the firm did not reduce the bonus target of 8.6 billable hours per day to reflect time spent on holiday.

Legal Business

Cadwalader London revenue drops 13% after restructuring team exit as global turnover makes slight return to growth

Bucking a trend which has seen a number of City outposts of US firms grow apace last year, turnover at Cadwalader Wickersham & Taft’s London office dropped 13% to $43.1m in 2018.

While London suffered the impact of a five-partner team departure at the beginning of last year, global figures painted a rosier picture as firm-wide turnover grew 3% to $420.7m after three consecutive years of decline.

Global profit per equity partner (PEP) rose 8% to $2.7m from $2.51m even as its partner ranks grew by 3 to 43. In 2017 PEP rose at a pacier 19%, but revenues dropped by a striking 10% to $408.1m after years of retrenchment in a bid to concentrate efforts on a more focused client roster. After cutting 15% of its legal workforce in 2017, last year the firm kept its lawyer headcount flat at 373, with revenue per lawyer growing 3% to $1.13m.

Conversely, the drop in London revenue comes after years of solid growth for the firm’s 60-strong City arm, which in the five years to 2017 grew almost fivefold from $10.8m to $50m.

The beginning of 2018 saw the firm hit by the departure of a dozen of its restructuring lawyers, including well-regarded Yushan Ng, who quit for Milbank, Tweed, Hadley & McCloy, and head of loan portfolios, debt and claims trading Louisa Watt, who moved to Brown Rudnick.

London managing partner Gregory Petrick told Legal Business that the revenue generated by the team which stayed at the firm was up 13%, while also pointing to the fact that the office had rebuilt its ranks over the year, finishing 2018 with the same headcount as it started.

London hires in 2018 included fund finance partner Samantha Hutchinson from Dentons, while real estate finance partner Duncan Hubbard joined from Norton Rose Fulbright in January this year.

Next year the firm will move to new London premises at 100 Bishops Gate, with space for up to 150 lawyers. ‘We feel we have the right strategy and we are in an aggressive growth mode,’ said Petrick. ‘The London office is right at the centre of that growth strategy.’

The firm’s global financial results mark the end of a five-year review process of its business, which was badly hit by the global financial crisis and the collapse of some of its key clients such as Lehman Brothers. The firm slashed its headcount and shut its Asia offices in Hong Kong and Beijing, as it looked to focus on its core client base of financial institutions, large corporates and funds.

The firm now has three offices in the States – with around 200 lawyers in New York and bases in Washington DC and Charlotte – while in Europe it keeps a small outpost in Brussels alongside London.

‘We are a quintessential Wall Street firm, known for finance and finance-related products. We embraced and emphasised that more,’ said Petrick.

A number of other US firms have announced strong financial results for their London practices. Akin Gump Strauss Hauer & Feld recorded a 28% City revenue hike to $123.5m. White & Case’s London revenue rose 7% to $350m and Milbank Tweed Hadley & McCloy recorded a 25% increase in City turnover to $156m. Elsewhere, revenue for Goodwin Procter’s London office grew 58%, while King & Spalding was up 12% and Cooley’s 16% to $66.7m.

Legal Business

Revolving doors: Cadwalader, JHA and Memery Crystal make key City hires as international moves dominate

In a quieter week for City recruitment, Cadwalader, Wickersham & Taft  made a key hire in London while a number of firms expanded their teams internationally.

Cadwalader reinvigorated its finance practice with the hire of partner Samantha Hutchinson from Dentons, after an exodus saw four partners leave its City restructuring practice at the start of this year.  Hutchinson specialises in advising lenders on a range of financing products across all fund sectors.

Dentons also lost corporate partner Zarko Iankov to independent London firm Memery Crystal. Iankov had been at Dentons for 15 years, specialising in international M&A work.

Elsewhere in the City, boutique firm Joseph Hage Aaronson (JHA) confirmed the appointment of disputes expert Richard Kiddell, having left Hogan Lovells after 13 years at the firm.

Joe Hage, managing partner at JHA, commented: ‘Richard brings with him a wealth of expertise that will help us to deliver added value to current clients, increase the depth of our offer and support our associates in their professional development.’

Keystone Law acquired former Seddons partner Susan Monty as the firm strengthened its dispute resolution practice. Monty has experience as an investigative lawyer at the Serious Fraud Office (SFO), and her appointment increases Keystone’s disputes team to 80 lawyers.

Osborne Clarke also made strategic additions, with the recruitment of Simon Thomas from Macfarlanes.  Thomas will join OC’s financial services team, having previously been a partner in the investment management group at Macfarlanes.

Kate Johnson, head of the financial institutions group at OC, lauded the hire, saying: ‘Simon brings a great market profile, strong credibility and outstanding personal client contacts. We look forward to having him on board.’

The international lateral scene saw more movement, as Hogan Lovells made a three-partner hire in Los Angeles, enhancing its national bankruptcy and restructuring practices. Richard Wynne, Bennet Spiegel and Erin Brady all join the firm from Jones Day  as Hogan Lovells boosts its California offering. The move comes after rival global firm Baker McKenzie recruited a five-partner employment and litigation team in LA from Hogan Lovells last month.

Chris Donoho, head of Hogan Lovells’ business restructuring and insolvency practice, said: ‘We have been looking to expand the national capabilities of our BRI practice, and Rick, Bennet and Erin are an ideal fit’

In Europe the lateral market was quiet, with Reed Smith being one of the few to make hires as the firm expanded its corporate practice with the acquisition Florian Hirschmann in Munich. Hirschmann joins from DLA Piper where he co-headed the China desk, while specialising in private equity and M&A work.

Delphine Currie, co-chair of the firm’s corporate practice, believed the hire will: ‘complement our existing capabilities and ensure we are able to offer our clients an even greater corporate service across Europe’

In Asia, Linklaters bolstered its disputes practice with the hire of former Goldman Sachs managing director Andrew Chung. Chung, who will join Linklaters the firm’s Hong Kong office as a partner in August, focuses on disputes and regulatory matters across the Asia-Pacific region.

Meanwhile Clyde & Co [] a significant departure in the Asia-Pacific, as Beijing managing partner Patrick Zheng left for Shanghai-based Llinks Law Offices. Before arriving at Clyde & Co, Zheng co-led the Greater China international arbitration practice for Clifford Chance (CC). Zheng will now help Llinks develop its Chinese clients’ outbound disputes practice.

Legal Business

More bad news for Cadwalader – global revenue dips 10% in 2017 as 10-year slide continues

Revenues at Cadwalader Wickersham & Taft dropped by a striking 10% in 2017 as the firm persists with retrenching in a bid to concentrate its efforts on a more focused client roster.

Global revenue at the Manhattan firm fell for the third consecutive year  to $408.1m against a 15% dip in the firm’s lawyer headcount to 373.

Profit per equity partner (PEP) grew 19% to $2.51m – largely down to the firm trimming five of its equity partners to 40. PEP previously increased 3% to $2.116m in 2016 as headcount fell 2% to 438.

A spokesperson for the firm said the 2017 results exceeded the firm’s internal projections by a substantial margin and pointed to the fact that revenue per lawyer grew 6% to $1.09m – while skirting over the reduction in lawyer numbers.

A reduction in headcount, expenses and revenue were all anticipated as part of the first step of the firm’s refocused strategy, adopted at the end of 2016.

Cadwalader has been shutting a number of its offices worldwide over the last couple of years as it looks to focus on its core client base of financial institutions, large corporates and funds. It closed in Hong Kong and Beijing in 2016 and in Houston last year.

The spokesperson said the firm expected to return to growth in 2018. However, the latest fall in global revenue is part of a sustained decline in turnover for a firm over the past decade or more – pre-financial crisis in 2007 the firm was in the top 50 of the Global 100 with revenues of $556m before sliding down the table as the top-line faltered – revenue has now fallen 27% since 2006, comfortably one of the slowest performances of any Global 100 firm.

Conversely, Cadwalader’s London office has been bucking the trend of late, growing revenue to $50m in 2017, a 10% increase on 2016 and almost five times the $10.8m posted five years ago.

But the new year started with some bad news for the firm’s City outpost too, as its restructuring practice was decimated by the departure of five partners.

Restructuring co-chair Yushan Ng left with a team of three other partners and 11 associates for Milbank, Tweed, Hadley & McCloy. Clients of the team include brand name sponsors Oaktree Capital, Centerbridge Capital Partners, GSO and Apollo.

Meanwhile, Brown Rudnick recruited head of loan portfolios, debt and claims trading Louisa Watt, leaving Cadwalader’s London team with only two restructuring partners, including office managing partner Gregory Petrick.

Petrick, for his part, painted a somewhat different story of the firm’s recent performance. ‘2017 was a very successful year for Cadwalader, with outstanding financial results firmwide and in London, and we are very optimistic going forward,’ Petrick told Legal Business at the time. ‘We have outstanding lawyers and market-leading practices in London and across the firm.  We will continue to focus on serving our core client base of financial institutions, large corporates and funds, both in London and across the firm.’

Legal Business

Cadwalader takes multiple hits in London as Milbank and Brown Rudnick swoop in

It has been an expansive start of the year in terms of partner hires for a group of finance-focused US shops with tight London operations.

First Cadwalader, Wickersham & Taft’s City restructuring practice was decimated by the departure of four partners to Milbank, Tweed, Hadley & McCloy, led by global financial restructuring co-chair Yushan Ng, with Jacqueline Ingram, Karen McMaster and Sinjini Saha following him. McMaster and Ingram had already followed Ng in changing firms in 2013 from Linklaters, where they were associates. Saha was made partner when she joined Cadwalader from Simpson Thacher & Bartlett in 2015.

Legal Business

‘A no-brainer’: Milbank hires four-partner Cadwalader team to upgrade City restructuring business

It has long been a prestigious New York shop without ever quite gaining critical mass in London, but Milbank Tweed Hadley & McCloy looks to be widening its ambitions after securing a four-partner restructuring team from Cadwalader Wickersham & Taft.

The move greatly expands Milbank’s City finance team, and includes Cadwaladers’ global financial restructuring co-chair Yushan Ng. He will be joined by partners Jacqueline Ingram, Karen McMaster and Sinjini Saha. Clients of the team include brand name sponsors Oaktree, KKR, Centerbridge Capital Partners and Blackstone.

Speaking to Legal Business, Milbank London co-managing partner Suhrud Mehta described the hire as a ‘no-brainer’ from a business perspective: ‘We have one of the world’s most renowned global financial restructuring practices. By bringing a star and his team on board, we’ll have greater depth on a transatlantic basis and in London one of the largest financial restructuring practices.’

Ng qualified at Linklaters and made partner at the Magic Circle firm in 2008. He joined Cadwalader in 2012. McMaster and Ingram joined Cadwalader in 2013 also from Linklaters, where they were associates. Saha was an associate at Simpson Thacher & Bartlett before joining Cadwalader as partner in 2015.

The hire comes eight years after Milbank recruited former Ashurst head of restructuring Nicholas Angel and brings the US firm’s London partner ranks to 26 – including six in restructuring. The 660-lawyer Milbank generated income of $855.6m in 2016, up 11% annually. During that financial year, London revenues edged up $4m to $114.1m.

The team’s departure leaves Cadwalader with four financial restructuring partners in London and comes after the firm posted revenues of $50m in 2017, a 10% increase on last year. The New York-based firm has been struggling to regain its 2000s momentum since the banking crisis, when it was heavily impacted by the collapse of key clients Bear Stearns and Lehman Brothers.

Legal Business

Cadwalader London office turnover nears $45m as firm quadruples City practice in four years

While the firm has been the subject of media scrutiny as it refocuses its US business, Cadwalader, Wickersham & Taft has enjoyed solid growth in its London office with turnover up to $44.9m, Legal Business can reveal.

The firm, which has not revealed London revenue figures in the past, recorded around 10% City growth in 2016 from $40.9m in 2015, as headcount increased from 56 lawyers to 60.

Cadwalader has grown its City practice despite retrenching from other jurisdictions in recent years, with office turnover having quadrupled from around $10.8m four years ago when the firm had just 18 lawyers in London.

Cadwalader London managing partner Greg Petrick (pictured) said: ‘We are very busy and see opportunities to add headcount in virtually all our practice areas. I could see us doubling our current headcount over the next four to five years. We have just taken on more office space in the City, for the second time in the past three years, to accommodate our continued growth.’

The firm has moved to restructure its global practice, pulling back in 2016 from Chinese outposts in Beijing and Hong Kong and shutting down its Houston operations.

Global growth has also stalled in recent years, as Cadwalader’s firmwide revenue fell 3% to $452m for 2016 following a 4% fall drop the previous year. Profit per equity partner, however, increased 3% to $2.1m. The firm has recently been hounded by rumours it is trimming back for a merger partner, although this has been repeatedly denied by management.

While the firm has cut back slightly on overall headcount, which fell 2% to 438 last year, London has seen renewed investment, with two City partner promotions in December and the additions of Bird & Bird disputes partner Steven Baker and King & Wood Mallesons finance partner Jeremy Cross. Former London managing partner Angus Duncan recently left for Winston & Strawn.

Cadwalader global managing partner Pat Quinn said the London office would continue to invest in its historic specialisms of structured products, finance and restructuring.

Quinn added: ‘We have been successful because we have emphasised the practices where our natural client base looks to us the most. Our best opportunity for growth, both in London and for the firm broadly, is in understanding the needs of our natural client base – financial institutions, large corporates and, increasingly, private funds – and continuing to deepen and expand our ability to serve those needs.’

Legal Business

A $50m hike sees Akin close on $1bn mark but City revenues slide; Cads shrinks again

US restructuring and energy leader Akin Gump Strauss Hauer & Feld piled $50m on to its top line in 2016 to take revenues to just under $1bn, despite a slide in City income.

While revenue for the 2016 year hit $980m, up 5.3% on its 2015 tally of $930m, the law firm’s City arm saw its local income fall from $91.4m to $87.9m. The Texas-bred practice dramatically upgraded its City practice in late 2014 when it absorbed the bulk of Bingham McCutchen’s City arm, shipping in a 22-partner team to double the size of its London practice.

The firm-wide increase in revenue has been accompanied by a rise in profit per equity partner (PEP), up from $1.9m in 2015 to $2.1m this year, with revenue per lawyer remaining broadly static.

Akin Gump’s London co-head, Sebastian Rice, told Legal Business that a run of marquee restructuring jobs through 2015 accounted for the comparative 2016 dip in City income. At the end of 2015, Akin Gump’s restructuring team headed by James Roome (pictured), concluded a major case involving three former Icelandic banks: Kaupthing, Landsbanki and Glitnir. The team represented holders of $33bn in bonds following the collapse of the banks.

Rice described the restructuring work as ‘keeping about 20 lawyers extremely busy’, adding: ‘At the end of 2015 it really hit its peak. Things took a few months to ramp up. By summer 2016 things were back in full swing.’

Roome commented on the slow start to 2016, saying: ‘All the junior people were hugely relieved to get a break!’ Rice and Roome both attributed the firm-wide revenue growth to Akin Gump’s focus on core product lines like financial restructuring, international trade and tax. Noted Rice: ‘We don’t pretend to be all things to all people around the world, we just focus on the things we are highly regarded for.’

In terms of key City appointments in the past year, Akin Gump hired arbitration partner Hamish Lal from Jones Day, corporate partner Igor Krivoshekov from Dentons and trade partner Jasper Helder from Baker McKenzie. Addleshaw Goddard litigator Kambiz Larizadeh is set to arrive next month, becoming the firm’s 37th partner in London.

The results come as US law firms begin releasing annual financial results, indicating how the world’s largest legal market fared in the 2016 year. While Weil Gotshal & Manges has just confirmed a robust performance in 2016, its New York peer Cadwalader, Wickersham & Taft this week said that turnover dropped 2.5% to $452m in 2016, against $463.5m the previous year. PEP increased 2.7% to $2.1m, while overall headcount fell 2.2% to 438.

The shrinking revenue coincides with the closure by Cadwalader of its offices in Beijing and Hong Kong, which was announced in the autumn, with the firm also set to shut its Houston arm as it refocus its efforts on its core Wall Street financial client base.

For an extended look at Akin Gump’s City ambitions see ‘The third wave’ (£) 

Legal Business

US partner promotions: Cadwalader adds two as Jones Day promotes five partners in the City


US firm Jones Day has promoted five to partner in London as part of a 47-strong promotions round, while New York outfit Cadwalader, Wickersham & Taft elected two in the City as part of a 10-strong cohort.

Jones Day promoted private equity lawyers Liam Bonamy, Ben Shribman and John MacGarty, banking and finance lawyer Polly O’Brien, and disputes lawyer Sylvia Tonova in this year’s around.

The US firm’s promotions matched its round of 47 lawyers the previous year, where two London lawyers made partner. In the current round, 15 of the firm’s new partners were female, around 32%.

Cadwalader is to add two London partners in a round of 10 promotions after a difficult year for the New York firm that saw a number of partner departures and the closure of its Hong Kong and Beijing offices.

Cadwalader elected financial restructuring lawyer Sinjini Saha to partner in the firm’s London office as well as capital markets lawyer Daniel Tobias. Saha represents private equity sponsors in leveraged buyouts, restructurings and securities matters, while Tobias specialises in collateralised loan obligations.

The firm also promoted seven to partner in New York, as well as one in Washington DC. Four of the firm’s 10 new partners are female.

Cadwalader managing partner Pat Quinn said: ‘This is another great group of young partners – our largest incoming class since 1993 – and each has demonstrated first-rate legal skills and superb client service capabilities. It is gratifying to note that four of our new partners are products of our Sponsorship Program for high-performing female and diverse attorneys.’

London partner promotions:


Sinjini Saha – financial restructuring practice, London

Daniel Tobias – capital markets practice, London

Jones Day

Liam Bonamy – private equity practice, London

Ben Shribman – private equity practice, London

John MacGarty – private equity practice, London

Polly O’Brien – banking & finance practice, London

Sylvia Tonova – global disputes practice, London