As the track records show, the ‘rumors’ about Dewey’s troubles are ‘proven facts’ in the world outside the myopic vision of Dewey administrators. And the claim of streamlining the company by trimming non-performers also fail the test of credibility, as each partner leaving Dewey is immediately signed on by other law firms who possess sufficient insider knowledge to refrain from hiring a non-performer. So, each day, the ‘rumors’ about Dewey not paying millions to partners and creating discriminatory pay structures at the cost of older, loyal employees to entice the young – seem to ring true.
The exodus on Friday has been confirmed by both law firms. Last week, twelve partners had left in a group for Willkie Farr & Gallgher.
Of the six attorneys who left Dewey five are from New York, and one from Chicago. Four were working in the insurance regulatory group at Dewey and the other two practiced tax related to insurance.
The New York Times had reported last week, that tens of millions in payments to partners were being withheld by the Dewey administration.
The lawyers who left this week from Dewey include heavyweights Jeffrey Mace, who used to head the Lloyd’s of London practice, and James Dwyer, managing partner of Chicago office.
Characteristically, Angelo Kakolyris, Dewey spokesman maintained that the moves would not have a material impact on the practice of the firm or its economy.
The Dewey spokesman told the media, “We have said all along that with change more departures were expected … The firm is poised to have a very good economic year. We have a strong and deep bench as is evidenced by the results our professionals are producing for our clients and the firm.”
However, the financial records of Dewey do not hint at such a big army of poor performers heading and managing its offices: Last year Dewey’s gross revenue increased from $910 million (2010) to $935 million according to the American Lawyer. That is close to a profit of $2 million per partner. Holding back on the money can obviously create a good economic year.
Dewey refused to comment on the amount of revenue the departing partners had brought into the firm.
Dewey Chairman Steve Davis told the media in a recent statement on Wednesday that Dewey had started 2012 “very strong.” He also said,” We are producing the best work in the history of the firm, and producing some of its strongest ever results. The overwhelming majority of our partners are excited about our future.”
While law firms are generally known to function on a low debt and acquisition of capital from partners, Dewey & LeBoeuf has an extraordinarily high debt of $125 million from a bond issued two years ago.