Thacher Proffitt & Wood, the 160 year-old New York law firm, has become the fourth US firm to dissolve this year after more than half of its lawyers defected to a rival.
Thacher Proffitt, which was heavily focussed on structured finance and real estate markets, said it would begin winding down at the end of the year after 100 lawyers quit for rival Sonnenschein, Nath & Rosenthal yesterday.
In a statement, the firm revealed it had been attempting to negotiate a merger with an unnamed law firm over the last six months.
“Although many avenues for a merger were explored, in the current economic environment it became apparent that a merger could not be executed.”
“In light of severe reductions in revenue, it became clear that Thacher Proffitt would not have the financial resources to continue business operations,” the firm said
The 100-lawyer group, which includes Thacher Proffitt managing partner Paul Tvetenstrand, consists of 40 partners and 60 associates who will join the New York office of Chicago-based Sonnenschein, Nath & Rosenthal in the New Year.
Thacher Proffitt is the third direct US legal casualty of the credit crisis following Thelen and Heller Ehrman, two California-based firms that have closed because of dwindling business this year.
Another New York firm, Dreier, has filed for bankruptcy protection after its founder, Marc Dreier, was accused of stealing more than $100 million from hedge fund clients.
Several other major US firms including White & Case and Cadwalader, Wickersham & Taft have collectively shed hundreds of lawyers this year as they adjust to reduced demand across property, finance, mergers and acquisitions and private equity markets.
A number of large UK law firms, including Eversheds, DLA Piper and Nabarro, have also cut staff this year although none have dissolved.