Steven Rabitz, a former in-house lawyer at The Goldman Sachs Group Inc. and Lehman Brothers Holdings Inc., took his New York-based employee benefits practice this week from Stroock & Stroock & Lavan to Dechert.
Dechert recently announced its hire of Rabitz, who advises clients in the financial services industry about the Employee Retirement Income Security Act’s fiduciary responsibility, prohibited transactions and funding rules.
“This is a move to a really pronounced, polished and fantastic platform,” said Rabitz, who while declining to name specific clients, noted that he shares many in common with current Dechert partners. “Most of my clients happen to be financial services institutions. I’m lucky to have clients that have been very loyal.”
The previous year has been a transformative one for Rabitz’s former firm, as previously noted by the New York Law Journal. In 2017, Stroock de-equitized about 21 partners, creating a new multitiered partnership structure and spelling out certain expectations for equity partners.
Other changes enacted by the New York-based firm, which saw its former co-leader leave last year for Proskauer Rose, included tightening its focus on core practices and diving into pricing analytics. Stroock also saw about 20 partner departures as gross revenue dropped 7.3 percent, to $251 million, although revenue per lawyer and profits per equity partner increased by about 2 percent and 30.4 percent, respectively, to $1 million and $1.6 million. The latter two metrics were the best that Stroock achieved in a decade, according to ALM Intelligence.
In late May, Fried, Frank, Harris, Shriver & Jacobson hired Michael Keats, the former co-head of the financial services litigation and enforcement practice at Stroock, as a partner in New York. Keats’ move came only a few weeks after Kramer Levin Naftalis & Frankel brought on Stroock partner Marissa Holob in New York to serve as co-chair of its employee benefits department.
But Stroock has also remained acquisitive in the lateral market, snagging Duval & Stachenfeld real estate capital markets co-chair Evan Hudson and Baker McKenzie’s former North American insurance chair Huhnsik Chung as partners in New York.
Rabitz said that Stroock’s management and partnership changes were unrelated to his decision to leave the firm. Instead, he saw a fit with Dechert and its financial services industry clients. Rabitz’s practice is much broader than simply ERISA work, he said.
“When most people think of ERISA lawyers, they think you wind them up and take them out when you need ERISA advice,” Rabitz said.
But that’s a misconception of his work for clients, many of whom are engaged in capital markets. For them, Rabitz said ERISA and its related regulatory environment requires multilevel thinking and planning.
Rabitz’s move to Dechert happens to coincide with what in all likelihood will mark the end of the U.S. Department of Labor’s proposed fiduciary rule, a relic from the Obama administration that was overturned earlier this year in a ruling by the U.S. Court of Appeals for the Fifth Circuit. If, as expected, the Trump administration opts to not seek a rehearing before the U.S. Supreme Court by a June 13 deadline, the lower court’s ruling will stand.
As a result, Rabitz’s clients—broker-dealers, banks, futures commission merchants, investment managers, mutual fund complexes and alternative fund sponsors and other financial market participants—will be able to strike off their regulatory compliance lists the Labor Department’s proposed restrictions about how they offer investment products to retirees.
The death knell for the Labor Department’s proposed fiduciary rule will not be the end of Rabitz’s clients being forced to cope with sudden regulatory changes.
“I’m going to continue to be very busy, living and loving it,” he said.
Rabitz predicted he will be helping his clients look ahead at efforts by states, the U.S. Securities and Exchange Commission and others that could shape their industry. He said his clients want to know how they can design their businesses to continue to be in line with future regulatory developments.
At Dechert, the firm’s newest hire will seek to help clients devise answers to those questions. Rabitz is the latest in a series of notable hires by the Am Law 100 firm, which recently brought aboard Kobre & Kim white-collar partner Roger Burlingame in London and added a high-profile products liability duo in New York from Quinn Emanuel Urquhart & Sullivan.