Why WolfBlock Didn't Merge to Survive
Like other well-known law firms that have suddenly imploded, WolfBlock focused in recent months and years on finding a merger partner.
But it never succeeded, and the partnership voted yesterday to wind up the more than 100-year-old law firm’s affairs. Three issues raised by the 300-attorney Philadelphia-based firm, at least in its failed merger talks with Akerman Senterfitt and Cozen O’Connor, may have doomed the effort to combine forces with another firm, according to the Philadelphia Daily News:
First, WolfBlock had a large unfunded pension liability that had to be dealt with. Second, agreement had to be reached on how to address a substantial tax impact on WolfBlock partners if the firm’s fiscal year changed (it currently ends on Jan. 31). And, third, a new law firm name, if any, must begin with “Wolf,” the firm insisted.
Meanwhile, despite the firm’s glorious past, it had seemingly lost momentum in recent years.
Despite its pedigree and reputation for skillful handling of complex real estate deals, the firm essentially lacked a workable plan for surviving, as a midsize firm in a dismal economy, against bigger and more specialized competitors, writes the Philadelphia Inquirer.
Then, after merger talks failed, the firm began losing partners, the newspaper writes.
“When you start to get a steady stream of defections going on over a period of one, two, three years, and they come from different areas of the practice, that’s a sign of trouble,” says Robert Denney, a legal consultant based in Wayne, Pa. “When I read about and heard about the two failed mergers, that’s just a sign there’s something wrong there.”
Comparing WolfBlock to the former Wanamaker’s department store chain which has been absorbed by competitors, professor Lawrence Hamermesh of Widener University School of Law recalled that he applied for a job there as he was graduating from law school. “It had a storied reputation as a powerful law firm that was politically well-connected,” he tells the Wilmington, Del., News Journal.
Among the well-known names in the firm’s Wilmington office is former Del. Attorney General Charles Oberly III. He and other Delaware attorneys on WolfBlock’s roster are expected to go to Drinker Biddle & Reath, as discussed in an earlier ABAJournal.com post, although this has not been confirmed by anyone involved.
Many of the WolfBlock lawyers in Philadelphia are expected to go to Cozen O’Connor.
Job-hunting will be difficult for WolfBlock staff members and lawyers who don’t have a book of business, observers predict.
But “I would say that for lawyers with solid business generation, they are going to be highly sought after. “For those that don’t, they likely will have a hard time, unless they are part of a group,” former Duane Morris chairman Sheldon Bonovitz tells the Philadelphia Inquirer.
Additional coverage:
ABAJournal.com: “WolfBlock Partners Vote to Dissolve; Many May Be Headed to Cozen O’Connor”
Updated at 7:42 p.m. to include information from most recent Philadelphia Inquirer article.
