Yuletide Good Will Spells Ruin For SF Law Firms
By Matt Smith
An apparent upwelling of holiday good cheer has destroyed two of San Francisco's oldest law firms, which had thrived during much of the past century by exploiting greed, jealousy, fear, malice and other non-holiday sentiments.
Thelen LLP, begun in 1924 and until recently one of America's biggest law firms, ceased to exist Dec. 1, thanks in part to the non-appearance of what was expected to be a rash of securities litigation accompanying the recent markets collapse, The Economist reports.
Thelen's demise came three days after the collapse of another grand SF law firm, Heller Ehrman, the report said.
According to The Economist, "although work has dried up in some areas--mergers and acquisitions, structured finance, property and construction--there is usually plenty of other business when the economy goes bad. Class-action securities-fraud litigation tends to soar in tandem with volatility on Wall Street and the blood pressure of fuming investors, for example. The trouble is that the counter-cyclical forces that were expected to save the skins of many firms, especially those that relied heavily on the financial industry, have yet to materialize."
Research says that despite our collective national economic disaster, Americans are not turning against each other -- or at least not against corporations. This lack of formal enmity is killing lawyers.
"Survey of litigation trends conducted by Fulbright & Jaworski, a law firm, shows a downward trend in the number of new suits filed against American companies: 21% saw none in 2007-08, compared with 11% in 2005-06. Investors, it seems, would rather not risk their cash on discretionary litigation. But among the law firms surveyed, 43% said they expected filings to increase in the next year, and only 3% expected a further fall," The Economist reported.