Bingham managing partner says firm is exploring options, including remote possibility of bankruptcy
Bingham McCutchen managing partner Steven Browne isn’t commenting on the firm’s possible merger with Morgan, Lewis & Bockius, but he does acknowledge his firm is exploring a variety of options.
One of those options, albeit a remote one, is bankruptcy, he tells the Boston Globe. “I’m not going to pretend things aren’t out there and the world isn’t a real world,” Browne told the newspaper. But bankruptcy is “certainly not any strategic alternative that I’m interested in pursuing.” A merger vote is expected in coming weeks.
Browne’s interview with the Globe was the first in which he commented on the status of the firm, which lost more than 50 partners since last year, including 18 partners at its London office. The firm also saw revenue drop by $110 million last year.
Legal analysts believe the firm’s rapid expansion is the source of its troubles, the story says. Under prior leadership, Bingham merged with 10 law firms in fewer than 15 years. As the firm expanded, it lured rainmakers with multimillion-dollar contract guarantees.
Browne told the Globe that Bingham has substantially reduced its expenses after hitting a “rough spot” and the firm expects improved profitability for its remaining partners. The cost of opening a new back-office facility in Kentucky hit last year as billings slowed, impacting profitability. He noted that partner contracts guaranteeing high pay have expired and perks such as apartments for top partners are no longer being offered.
Current and former law firm employees told the Globe about another perk: Some of the most senior partners were chauffeured in Lincoln Town Cars at firm retreats, while others rode in buses.
Browne said the firm is still working on large deals, including the $2 billion sale of Oculus VR to Facebook, and “there’s tremendous opportunity here.”
