Cadwalader Trying to Prove Us Wrong

John Cadwalader

Despite a variety of setbacks throughout a year that didn’t start so well, Cadwalader posted positive results that simply go to show how they have survived for such a long time.

In an immense improvement over 2008, the turbulent 2009 ended up much improved (at least for those that still had jobs).  Cadwalader recently posted that PEP increased a whopping 28 percent to $2.4 million.  While gross revenue ended up showing a 9.78% loss, net income actually increased by 1.38%.

So how did they turn lemons into lemonade?

According to the ABA Journal:

Cadwalader chairman W. Christopher White credits the results to work on large corporate and restructuring deals last year, along with cost-cutting measures, the story says. After layoffs, the law firm had 12.6 percent fewer lawyers.

It took a lot of hard work and tough decisions to get there (including some harsh tolls on individuals):

In 2008, Cadwalader announced layoffs affecting 131 associates, job cuts that preceded much of the rest of the legal industry. The firm also announced layoffs affecting 25 lawyers around the world in early 2009, while in July, the firm offered a one-year sabbatical to 34 lawyers. Cadwalader had a total of 457 lawyers at the end of August 2009, down 12.6% from a year earlier when the firm had 523.

The problems for Cadwalader didn’t stop there as they saw an alarming number of partners leave for other firms in 2009.  These casualties included Bruce Zirinsky (Cornell BA ’69, NYU JD ’72), John Bae (SUNY BA ’86, Hofstra JD ’89), and the “newly-minted partner” Nathan Haynes (Northeastern BS ’95, Pace JD ’98) to Greenberg Traurig.  They also included practically the entire London office jumping ship in a mass exodus to Paul Hastings in early January 2009. Most recently (compliments of the Lateral Tracker), we see that Real Estate partners John Busillo and Alan Lawrence moved to the New York office of Arnold & Porter just last month.

Even former Cadwalader partner Thomas Russo decided to go to Patton Boggs following the collapse of Lehman Brothers.  He is now the new GC for AIG, replacing Anastasia Kelly.

On the plus side, they replaced King & Spalding on the Landry’s reorg “Deal from Hell,” restructuring partner John Rapisardi picked up some big-ticket engagements like representing Treasury in the auto “bailouts” and M&A partner Dennis Block’s amazing run at the Pfizer table ($250 billion and counting!) continued.

Despite everything the firm went through, it seems that the restructuring actually worked to Cadwalader’s advantage.  Like we wrote in “Cadwalader in Trouble” from January 2009… You simply cannot bet against a firm that has been around for 217 years.

Tagged as: aig, bankruptcy, cadwalader, king & spalding, M&A, patton boggs