New York’s Cravath, Swaine & Moore has a $35 million bet riding on the success of the AOL-Time Warner merger in a contingency-fee gamble that is unusually large and risky, The American Lawyer reports in its upcoming February issue.As lead outside counsel to longtime client Time Warner Inc. in the largest merger in history, Cravath agreed to a fee structure that borrows heavily from the all-or-nothing approach that companies typically use with their investment banks.

According to several sources familiar with the fee agreement, Cravath will receive one of the biggest transaction fees ever for a law firm — a staggering $35 million — if the merger closes. But if the deal falls apart, Cravath’s lawyers could go home empty-handed.