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In February, when Fried, Frank, Harris, Shriver & Jacobson named Valerie Ford Jacob as co-managing partner, the partners appeared to be voicing support for the merger talks with London’s Ashurst Morris Crisp. Since the beginning of the drawn-out discussions — once the worst-kept secret in the legal industry — Jacob had been the point person for Fried Frank. According to partners, she did a good job of rallying the firm around the idea of a transatlantic combination. Not that there weren’t dissenters. A few recruiters say that some Fried Frank partners with big books of business weren’t sold on the transaction. Still, as merger discussions intensified through the first few months of the year, most seemed to be in favor of it and a deal was thought to be close. But then, in April, Stephen Fraidin, one of the most highly paid partners at Fried Frank, announced he was leaving for Kirkland & Ellis. The timing of Fraidin’s departure didn’t portend good things for the Ashurst deal. And indeed, in May, Fried, Frank and Ashurst announced that they had ended their discussions. The sequence of events, separated by three weeks, begs the question: Did Fraidin leave Fried, Frank because of the impending merger, or did Ashurst back out because FRAIDIN WAS LEAVING? The answer to both seems to be: not really. First, Fraidin had been unhappy at the firm long before the merger talks heated up. Despite being one of the firm’s biggest rainmakers, Fraidin felt the firm gave his views too little consideration, according to those close to him. (Fraidin declined to comment for this story.) Once known as an M&A powerhouse in the 1980s, Fried Frank has since slipped in that area. In our latest Corporate Scorecard, in April, the firm ranked twenty-first by value of announced public deals involving at least one U.S.-based principal and fifteenth by number of deals. But over the last decade, Fried Frank has made a concerted effort to diversify into such areas as antitrust, private equity, capital markets and white-collar crime. Fraidin disagreed with the diversification, which he thought hurt the firm’s focus and profitability. The proposed merger was just another strategic decision that Fraidin disagreed with. “Steve said what he thought,” says Michael Rauch, who sat on the firm’s 15-member governance board with Fraidin. “He’s a heavy thinker, and people listened, and I assume he listened to other people’s responses.” It’s unclear how much business Fraidin took with him. His clients have included Forstmann Little & Co., Northrop Grumman Corporation, and The Procter & Gamble Company, but Fried Frank says it continues to do work for all three. Fried Frank partners say Fraidin’s departure was not the cause for the merger’s failure. Co-managing partners Jacob and Paul Reinstein concede it was “discussed” during the intense final stage of negotiations, when partners from both firms were shuttling between New York and London. But the two give more weight to the difficulties in pulling off “a merger of equals” — difficulties that they declined to specify. Fraidin’s not the only heavyweight to leave Fried Frank. In the last few years, the list includes M&A partner Charles Nathan, now at Latham & Watkins; former litigation department head Gregory Joseph, now at his own boutique; former Securities and Exchange Commission chairman Harvey Pitt, who has begun to form a consulting firm; and now Fraidin, who has lured corporate partner Thomas Christopher to Kirkland. The firm has also slipped in the Am Law 100 profits-per-partner rankings. From 1986 to 1993 it landed in the top ten every year but one, but hasn’t been there since. This year it ranked thirtieth, despite posting its second-highest earnings figures in firm history. In the company of an outside public relations specialist, partners touted the firm’s strengths for this article. And there are some positive developments. Since the nonmerger announcement, partner discussions with headhunters have mostly been hushed, and Jacob says the firm is more united now about the firm’s future. Notable examples of the firm’s existing talent include Brad Scheler in bankruptcy, Jacob in capital markets, and Jonathan Mechanic in real estate. In his farewell e-mail to Fried Frank colleagues, Fraidin was philosophical. “Law firms, including this one, are dynamic,” he wrote. “They change, and they should change … . “When Fraidin wrote those words, change appeared to mean marriage to the Brits at Ashurst. Now it just means living without Fraidin.

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