Weil, Gotshal & Manges “will be deemphasizing” its complex commercial litigation practice in Houston as part of “adjustments” the firm announced today because “the market for premium legal services has entered into a ‘new normal’ after the 2008 financial crisis,” Barry Wolf, the firm’s executive partner, announced in an email sent to lawyers and staff.
The New York City-based firm also plans to lay off about 60 associates and 110 staff and adjust compensation of certain partners, wrote Wolf.
The number of lawyers and staff who will be affected by the downsizing in the firm’s Houston and Dallas offices is unclear. John Strasburger, managing partner of the Houston office, did not immediately return a telephone message seeking comment. A call to Glenn West, managing partner of the Dallas office, was returned by Robert Lennon, head of business development at Weil Gotshal. When asked how the layoffs would affect the Houston and Dallas offices, Lennon only said the impact is “firmwide.”
Lennon did say the firm will not close any offices.
The firm has 79 lawyers in Dallas and 37 in Houston, according to the firm’s website.
Wolf wrote in the email that restructuring and litigation work related to the 2008 financial crisis is winding down, and the overall market for transactional activity remains at low levels, so the firm must make adjustments it has avoided over the last few years.
He wrote that the market for premium legal services is “continuing to shrink” and that actions to enhance revenue alone are insufficient to position the firm for the new market conditions.
“Accordingly, there will have to be meaningful compensation adjustments for certain partners in light of the economic realities of the new normal. It may well be that some of these partners will decide to pursue other opportunities,” Wolf wrote.
In addition to the planned associate and staff layoffs, Wolf write that the firm will de-emphasize the complex commercial litigation practice in Houston and Boston.
Wolf did not immediately return a telephone message.
Weil Gotshal’s gross revenue hit $1,228.5 million in 2012, which was flat compared to 2011, according to the AmLaw 100 report, published by Texas Lawyer sister publication The American Lawyer. Profits per partner in 2012 averaged $2.23 million, down 8.6 percent when compared to 2011, and revenue per lawyer averaged $1.025 million, down 3.8 percent.