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PHILADELPHIA — In December 1999, Dechert announced a special retention bonus program for its associates in which the firm’s policy committee set aside $50,000 of its investment in high-flying client Internet Capital Group. The plan called for all associates and counsel employed by the firm on Dec. 31, 1999, and who were still employed on Sept. 15, 2003, to receive a bonus equal to their prorated share of the investment. At the time, including associates and counsel in an investment in an exciting Internet client had to be viewed as a generous perk. But the old saying that no good deed goes unpunished would seem to apply here. ICG’s stock value tanked with the dot-com economy in late 2000, but Dechert did not sell its shares until recently. Because the value of ICG stock has depreciated greatly, the firm was left with only $2,744.42 to divide among 177 attorneys, each of whom will receive $15.50, according to a memorandum sent to all of the firm’s lawyers Tuesday by partner James Lebovitz. “We thought we were doing something great for our attorneys,” Dechert management said in a statement released Thursday through a firm spokesman. “Unfortunately, it didn’t turn out that way. Of course, this is not the only Internet stock that has disappointed investors.” Altman Weil consultant William Brennan said it is not uncommon for law firms to invest money on behalf of a partnership but that it is rare for management to do so for associates and counsel. “Dechert was being extremely generous,” Brennan said. “But it was a different era. There was a kind of euphoria about what was happening with the stock market, and ICG was a darling of Wall Street. Unfortunately, Dechert didn’t cash in at that point.” One Dechert associate, who asked not to be identified, said he was not upset when he received Lebovitz’s memo. “I’d be surprised if anyone was shocked that an Internet stock from a few years back had tanked,” the associate said. ICG, backed by companies such as Safeguard, Comcast and Compaq, and founded in 1997, invested in and helped develop a network of interrelated, business-to-business Internet companies. Dechert partner Henry Nassau left the firm in 1999 to become ICG’s chief operating officer, general counsel and secretary. After guiding the company through a turbulent four years, Nassau returned to Dechert last fall. Jeff Blumenthal is a reporter for The Legal Intelligencer , a Recorder affiliate based in Philadelphia.

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