For Richard Levin, the commute to his new law firm from the Upper West Side required only a slight adjustment: simply get off the subway one stop earlier.
For his new firm, Cravath, Swaine & Moore, the change was more extensive.
While other Manhattan firms are building up their bankruptcy departments, Cravath Swaine is just getting into the practice. For the first time in its history (parts of the firm date back to 1819), Cravath is forming a restructuring practice. And it has broken tradition to do so, by hiring a partner from outside the firm.
Mr. Levin, who started at Cravath on July 1, came from Skadden, Arps, Slate, Meagher & Flom, where he had been a partner for a decade. Mr. Levin played a crucial role in drafting the 1978 federal bankruptcy code.
Cravath’s move, in the words of one bankruptcy lawyer in New York, was “a continental shift,” a recognition by an old-line firm, however belatedly, that bankruptcy had moved beyond the days when it was the purview of collection lawyers chasing debtors to the courthouse. Ten or 15 years ago, said Ann Israel, who heads a legal recruiting firm in New York, firms like Cravath would have never looked at a bankruptcy group.
“This is a big, serious practice now,” Ms. Israel said. “This isn’t an embarrassment any longer.”
Also, “this is a big, big moneymaker,” she said, since many large companies — Enron, Delta, Northwest and Delphi — have reorganized in the last six years.
Like many old-line firms, Cravath had a history of developing talent from within, hewing to a founding principle that a Cravath partner was made, not born. (Lawyers at Cravath remember only one previous outside, or “lateral,” hire before Mr. Levin, and that was a tax lawyer three years ago.)
The “Cravath System” is laid out in a musty rose-colored book, “The Cravath Firm and Its Predecessors: 1819-1947,” a 1948 work by Robert T. Swaine, given to every lawyer upon being named a partner. The book notes the wisdom of the firm’s founder, Paul Cravath, who believed that lawyers should be recruited from law schools rather than from other firms.
“Cravath men,” the book says, should be “taken to the shallow water and carefully taught strokes.”