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In August of 2002, Elvis left the building. At least that’s how it must have felt to lawyers at New York’s Weil, Gotshal & Manges. After 33 years at the firm, Harvey Miller, the legendary head of Weil’s bankruptcy department, packed his bags and moved to New York investment bank Greenhill & Co. “It was like one of the fathers of the firm had left,” says Thomas Roberts, head of Weil’s corporate practice. Age, it seems, had caught up with dear old dad. Miller, who turned 70 in March, left Weil of his own volition, but not before the firm’s retirement policy had stripped him of some authority. Now Weil has some gargantuan shoes to fill. With a mixture of grit and panache, Miller accomplished a rare feat in the crowded, largely undifferentiated legal business: He built a brand. When major companies think bankruptcy, many think Weil; perhaps no large firm is more closely tied to a particular trade. And oh, what a trade: Weil specializes in representing the likes of busted Enron Corp. and broken WorldCom Inc.; it’s the stuff of headlines and massive legal fees, and it’s no small reason that Weil is one of the nation’s largest, most lucrative firms. But now what? Weil’s new bankruptcy coheads — Martin Bienenstock and Marcia Goldstein — are seasoned, respected attorneys, but, alas, they are not Harvey Miller, at least according to the scorekeepers in the bankruptcy bar. As one leading New York banker puts it, “Harvey left behind the munchkins.” Gratuitous, perhaps, but it’s the sort of slight that comes with following a legend. The fact is, Bienenstock and Goldstein are standing tall right now. The past year has been dominated by massive bankruptcies, and Weil has snared many of the biggest cases. Still, questions persist. Now that Miller is gone, can Goldstein and Bienenstock continue to land big cases? How will they fare when the economy improves and bankruptcies become more scarce? Not surprisingly, Weil’s competitors predict that Weil’s new bankruptcy co-heads will not be able to match Miller’s track record. Succession is never easy, as monarchs and law firms know all too well. For the fate of a bankruptcy practice to command such attention on Wall Street is a measure of just how far bankruptcy has come since Miller arrived at Weil in the late 1960s. At that time, bankruptcy was widely viewed as the legal business’s equivalent of used-car sales — nickel-and-dime collections stuff, tawdry and unsophisticated. A cultural bias contributed to the distaste, since bankruptcy was regarded as a specialty for Jewish lawyers. Indeed, many Jewish law school grads had migrated to the practice after being shunned by the country’s top law firms and thus shut out of more elite specialties. Since it was founded by Jewish lawyers, Weil was a natural choice to take a stab at bankruptcy work, despite its cultural baggage. In the 1960s, Weil was not yet a major firm; it had about 45 lawyers and specialties in midmarket corporate work, litigation, and tax. One of Weil’s partners, antitrust specialist Ira Millstein, had gotten a taste of bankruptcy work when he was hired to work on the restructuring of Ira Haupt & Co., a New York brokerage firm that filed for bankruptcy in 1963. The trustee in that case was Charles Seligson, who at the time was head of the New York bankruptcy firm Seligson & Morris, where 30-year-old Harvey Miller worked. Millstein was impressed with Seligson’s and Miller’s work in the Ira Haupt matter — so impressed that he advocated bringing them to Weil to build a bankruptcy practice. Such a practice needn’t besmirch the firm, in Millstein’s view: He recalls telling his fellow partners that bankruptcy “is a perfectly respectable business and can be conducted with perfectly respectable people.” By 1969, Seligson was looking to join a larger firm because his longtime partner, J. Lincoln Morris, was retiring. So in December of that year, Seligson, Miller, and another Seligson & Morris lawyer, Alan Miller (who is no relation to Harvey Miller), packed up and moved to the 31st floor of Weil’s midtown offices. Seligson, who was in the twilight of his career, immediately handed control of Weil’s nascent practice to Harvey Miller. Miller ran with it and never looked back. One of Miller’s first orders of business was to convince Weil to try its hand at debtor work — representing bankrupt companies. Even though it can be enormously lucrative, firms have long shied away from such work because it can put them at odds with institutional clients — namely, banks that are owed money by debtors. So it was no surprise that some Weil partners objected to Miller’s push to handle debtor assignments. Miller’s response: “As long as we are not representing debtors and creditors in the same case, there should be no conflict.” In fact, various courts have penalized Weil for alleged conflicts in representing debtors, but it hasn’t slowed the firm’s quest for supremacy in the debtor-side arena. By 1975, Weil’s practice was already split 50-50 between debtor and creditor work. Miller’s foray into debtor-side work was well timed. In 1978 Congress overhauled the bankruptcy code, making it easier for companies to file for bankruptcy. Congress also threw a bone to lawyers. Traditionally, bankruptcy lawyers had been expected to charge reduced rates, the notion being that bankruptcies should be governed by a spirit of thrift. But to attract a better brand of attorney to the industry, the overhaul stipulated that bankruptcy lawyers could henceforth command the going market rates for legal fees. The net effect was a boon to the bankruptcy business. Name-brand companies started filing for bankruptcy in unprecedented numbers, and law firms rushed to cash in. Much of the new bounty went to Weil, which, at the time, still counted boutiques, such as New York’s Levin & Weintraub, as its closest competitors. In the 1980s Weil landed many of the biggest debtor cases, including representations of Continental Airlines Inc., Texaco Inc., and Drexel Burnham Lambert Inc. The flurry of business on the eastern seaboard gave Miller the resources to extend Weil’s brand beyond New York. In the mid-1980s, for example, Miller rushed to open a Houston office when Texas’ energy industry tanked. A few years later, he placed bankruptcy attorneys in Weil’s Dallas office and soon boasted one of the top bankruptcy practices in Texas. When the next bankruptcy boom hit, in 1991, Miller had 120 lawyers under his command and the country’s top restructuring practice by far. Miller would never relinquish that position. But Miller’s success wasn’t just about scale. He is also credited with making bankruptcy practice respectable. That is due in part to his presence, the way that Miller fills a room with his 6-foot-2-inch frame, powerful voice, and athletic vigor. And then there is his sense of style: Miller is a fervent Anglophile and a fan of fine wine, opera, and expensive suits. In an industry once thought of as grubby, Miller looked like a duke. For all his flair, though, it was Miller’s bookishness and diligence that propelled Weil. Miller often worked late into the night, reading the latest bankruptcy rulings and poring over the bankruptcy code, highlighting and tabbing key passages. He also kept a close eye and a tight grip on his charges. After an appearance in court, associates had to report directly to Miller, to make sure all had gone as planned. Filings also had to pass Miller’s rigorous inspection. If a document fell short of his standards, and it often did, Miller would sometimes ball up the offending document and hurl it at the author. “God help you if you worked on a case with Harvey,” says John Rapisardi, a Weil partner who left the firm in 2001 for the New York offices of Jones Day and then returned to Weil earlier this year. “He would send you these memos — we called them Harvey-grams. He would dictate 9,000 things for you to do, 8,000 of which you hadn’t thought of. . . . He was a real son of a bitch.” Adds a former Miller understudy, who is now a bankruptcy lawyer at a large New York firm: “I was there every night until 1, 2, 3 in the morning, but Harvey was often there too. He never left before 11 p.m.” Some lawyers wilted under Miller’s relentless pace and dictatorial style. “You could spread your wings and develop more after you left, because you weren’t so controlled,” says a former Weil associate. But Miller also lost many lawyers simply because he had the deepest bench and some of the best-trained talent — a lawyer who wanted to head a practice would have to go elsewhere. Today, the Miller alumni association is an impressive group and includes lawyers who now head their own practices, such as Bruce Zirinsky at Cadwalader, Wickersham & Taft; Brad Scheler at Fried, Frank, Harris, Shriver & Jacobson; and Michael Cook at Schulte Roth & Zabel. Despite the rigors of their experiences with Miller, many former Weil lawyers — even Rapisardi — also remember their old boss fondly. Yes, Miller was demanding, they say, but he was also a winner, and his zest for the work was intoxicating. So why did Miller hang it up? Age was the primary factor. He has no thoughts of retirement, and seemingly has at least another 10 good years in him. But by 2001, he had run headlong into Weil’s retirement policy, which requires lawyers, at the age of 68, to exit Weil’s management committee and relinquish their equity in the firm in favor of a set salary. Stephen Dannhauser, Weil’s chairman, says that he had spoken with Miller about the prospect of handing over his department’s reins. “From [Miller's] perspective and mine,” says Dannhauser, “Martin and Marcia were deserving of an opportunity” to head the group. Miller could have remained at Weil and continued to participate from afar, but he concedes that he is not the sort to take a backseat. Still, he denies that he felt coerced to leave. “I looked around and said, ‘The department is doing as well as or better than it had.’ You want to leave at a time when you are at your peak.” Plus, says Miller, “I figured it would be good for Marcia and Marty to get out from under my shadow.” In a Weil conference room overlooking Central Park, Bienenstock and Goldstein have taken a break from the press of work to talk about the franchise they’ve inherited. It has never been healthier, say the lawyers, who are both age 50. In fact, it is so healthy, they say, that they agreed to co-head the group so they could better balance work and management. “I don’t think either one of us wanted to do it all alone,” says Bienenstock. It is easy to see why. Weil, after all, is lead counsel to Enron, WorldCom, and Global Crossing Ltd., debtors in three of the six largest bankruptcy filings ever. Weil will receive tens of millions of dollars in fees in each of these cases. As lead debtor’s counsel, Weil must not only attend to the myriad aspects of its clients’ businesses — a task which requires the complementary skills of corporate, tax, and labor lawyers, among others — it also must respond to the fraud investigations that are a prominent part of the three bankruptcies. And that is just part of the department’s workload. Weil is also representing Adelphia Business Solutions Inc., Armstrong World Industries Inc., and the Bethlehem Steel Corp., all multibillion-dollar debtors. And Weil has been advising the AMR Corp., the parent of American Airlines, in its struggle to avoid one of the largest-ever airline bankruptcies. In short, Weil’s 90-lawyer restructuring team, which makes up less than one-tenth of the firm’s head count, is on track to post another banner year, according to Bienenstock. In 2002 the bankruptcy team generated roughly $130 million in revenue, more than many AmLaw Second Hundred firms brought in last year. So it’s hardly surprising that Bienenstock and Goldstein ooze confidence. Even with Miller gone, Goldstein maintains, Weil has the deepest and most talented bankruptcy team in the country. Adds Bienenstock: “We are facing less competition now than ever.” The picture is not quite that rosy. Many bankruptcy competitors concede that Weil still has as much bankruptcy talent as anyone, if not more. And fewer law firms than ever — fewer than 10, to be sure — are regularly retained to represent debtors in multibillion-dollar bankruptcies (“jumbo-mega cases,” as Bienenstock calls them). But according to some bankruptcy professionals, Skadden, Arps, Slate, Meagher & Flom, with about 125 full-time bankruptcy lawyers, has pulled into a virtual dead heat with Weil for top debtor-firm honors. And Kirkland & Ellis, Jones Day, and Willkie Farr & Gallagher are not far behind. A review of last year’s largest bankruptcies underscores the dominance this group has attained. One New York bankruptcy lawyer predicts that Weil will lose ground now that Goldstein and Bienenstock are in charge. “The pack will catch up with Weil,” says this lawyer. It’s inevitable that Bienenstock and Goldstein will be measured against Miller, at least for a while. Lawyers say, for example, that Bienenstock, a part-time Harvard Law School professor, has Miller’s smarts, confidence, and diligence. For an entire year, from 1986 to 1987, Bienenstock spent almost every weekend at the firm writing a treatise on Chapter 11 bankruptcies that has been updated and is still widely used by professionals. But some lawyers say that Bienenstock lacks Miller’s people skills. For all his bluster, Miller was adept at turning on the charm, they say. Bienenstock comes off as more reserved than Miller. Goldstein, meanwhile, is scholarly and personable. She teaches a bankruptcy course with Miller at Columbia University Law School. But a New York lawyer who has worked with her says that she lacks Miller’s verve. “Marcia has a tremendous personality,” says the lawyer, “but she doesn’t have the energy that you are used to from someone who leads a section.” Goldstein counters that she is very committed to the practice. “I am handling a huge load of complex cases,” she says. “My days and weekends are very long.” If Weil suffers from a charisma deficit now that Miller is gone, it could affect the firm’s ability to generate new business. Miller’s magnetism made him a formidable rainmaker, says a partner at one of Weil’s competitors. Many distressed companies hire Weil, even though they have never used the firm, strictly because of its reputation. And Miller deserves much of the credit for such business, Bienenstock acknowledges. But, he adds, Weil lawyers must also actively develop business, by forging ties with accountants and bankers, who are good sources of referrals. In his last years at the firm, Miller had increasingly delegated that sort of business development to his younger partners, says Bienenstock. “For the last 10 years, the bulk of bankruptcy business, 80 percent or more, was developed by partners other than Harvey,” Bienenstock says. “That is why, from a business point of view, there is not much of a difference [now that Miller has left].” Certainly there is not much of a difference — yet. But Weil, like all bankruptcy firms, will face a stiffer test when the economy improves. Bienenstock and Goldstein have already anticipated such a development and have made it a goal to diversify their department’s product line. Goldstein, for example, is advising companies on the creation of special-purpose entities, which are designed to protect certain parts of a business from creditors in the event of a bankruptcy. Bienenstock, meanwhile, is capitalizing on the corporate governance craze touched off by last year’s Sarbanes-Oxley legislation. He says that he now regularly counsels companies on how to set up internal governance systems to properly anticipate and guard against future liquidity problems. “We have a more expansive view of what we can do with our practice,” says Goldstein. Adds Bienenstock: “We want our associates and younger partners to realize that we aren’t approaching a saturation point and that there are opportunities to expand the practice without having to make bets that the Chapter 11 component of the business will get larger.” Indeed, if the economy picks up, Weil will not want to be overly reliant on bankruptcy filings. But apart from economic cycles, Weil seems to be trying to distance itself from its bankruptcy-heavy reputation. For better or worse, Weil is still known as a bankruptcy firm. And that can gall firm partners, Miller admits, because Weil has tried to fashion itself as an all-purpose corporate powerhouse. Indeed, Weil lawyers repeatedly insist that bankruptcy is just a part of what their firm does, and some Weil attorneys seem to loathe even mentioning the B-word. Weil, they say, specializes in restructuring work, and that includes counseling distressed companies that are not bankrupt. Weil’s competitors, conversely, occasionally try to paint Weil into a bankruptcy corner. They say that corporations, which are in difficult but not dire financial straits, may be reluctant to hire Weil, because the Weil name sends a signal to the marketplace that a company is in really bad shape. As head of Weil’s corporate practice, Roberts is well aware of such typecasting. It comes up, he says, when Weil is trying to compete for private equity business: “Competitors will say [to a company] that [Weil] is just a bankruptcy firm, so you don’t want to hire them.” But Roberts says he has never encountered a corporation that has shied away from Weil because of its bankruptcy brand. And, he adds, the firm has never wavered in its commitment to building and maintaining the country’s top restructuring practice. Says Roberts: “Bankruptcy has never been something that this firm will put on the back porch.” Weil, in short, wants to have it both ways: It wants to be known as a top bankruptcy firm, but not known as only that. In some ways, then, Bienenstock and Goldstein may be just the right lawyers to succeed Miller. They are well-known, with big-case credentials (Bienenstock is the lead counsel in Enron’s filing, and Goldstein is lead counsel in WorldCom’s). But the two lawyers are not as closely associated with bankruptcy work as Miller, who was practically a brand by himself. In some circles, Miller was known simply as “Doctor Doom” or “Doctor Death.” It is hard to imagine Bienenstock or Goldstein, or their successors, earning such colorful monikers. But that may not be such a bad thing for Weil, as it slowly, subtly drifts away from the legacy that Miller created. This article was distributed by the American Lawyer Media News Service. Nathan Koppel is a senior reporter at The American Lawyer.

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