In the past few weeks, Stroock & Stroock & Lavan’s website has been disheartening to peruse, witnessing a significant reduction in the roster of lawyers at the once thriving New York firm, now dwindled to just a handful. Last week, Seyfarth Shaw announced the addition of four senior white-collar lawyers, bringing the total listed on the site to a mere 19 individuals. However, the website has since gone offline, and the offices of the dissolved firm are set to be vacated by the end of the month.
Just over two years ago, the Seyfarth team, headed by Richard Morvillo based in Washington DC, had recently transitioned to Stroock from Orrick. During this period, the firm was experiencing a positive trajectory, fueled by thriving deal markets that eventually resulted in its second-highest recorded turnover as it approached its 150th anniversary. Nevertheless, there were cautionary indicators that extended over several years
“Stroock had built a century-long legacy as a politically astute and well-connected law firm in New York, maintaining close ties with city agencies, public unions, and influential figures within the Democratic party,” notes Robert Bata, principal of the consulting firm WarwickPlace Legal.
“It possessed a notable real estate and litigation practice, complemented by a highly esteemed bankruptcy practice. However, the firm failed to capitalize on expansion possibilities during successive waves of domestic mergers. Its leadership remained unwilling to entertain what they perceived as a compromise of independence and potentially a threat to their positions.”
“According to ALM Intelligence’s research, the firm’s headcount reached its pinnacle in 2002 at 374, and revenue reached its zenith in 2007, falling just shy of the $300 million milestone at $297 million.”
During the financial crisis, two pivotal capital markets clients of the firm, Bear Stearns and Lehman Brothers, faced failure. In 2017, Stuart Coleman, Stroock’s former co-managing partner and chair of its well-regarded investment management practice, departed, taking six partners to Proskauer Rose.
Subsequently, in March 2022, the firm suffered a critical setback when Paul Hastings successfully recruited virtually its entire restructuring team, comprising 19 partners, marking what would prove to be a fatal blow.
Stroock’s response, at least publicly, was to restate its faith in its market position as a quality mid-sized firm. Acknowledging that the bankruptcy group wanted a “larger firm environment”, co-chair Jeff Keitelman said: “We’re committed to our mid-sized firm approach and building in the areas where we excel.”
He highlighted the recruitment of over 20 partners in the last 18 months across corporate, IP, white-collar/corporate investigations, tax, and real estate. However, the market dynamics were shifting, and in the latter half of 2022, the deal markets came to a standstill.
It became evident that the firm was exploring merger discussions. In the subsequent months, it was associated with potential mergers with Steptoe & Johnson, McGuireWoods, Squire Patton Boggs, and Nixon Peabody. Reports suggested that an unfunded pensions obligation was posing a challenge to any prospective deal.
Simultaneously, the firm was undergoing a continuous departure of partners, notably losing a 35-lawyer reinsurance and consumer litigation team to Steptoe in July 2023. Despite seemingly resolving its pension-related challenges by the summer, successfully securing the required votes from retired partners for a pension buyout, it became apparent that these efforts were insufficient and arrived too late.
Towards the end of October, the firm’s recent negotiations with Pillsbury Winthrop Shaw Pittman yielded no agreement. A few days later, the partners of Stroock collectively decided to bring things to a close, casting a vote in favor of dissolving the firm. This decision coincided with a significant development, as a 28-partner team of real estate lawyers, including Keitelman, finalized an agreement to join Hogan Lovells.
Firms that have recruited from Stroock in past year*
Adler & Stachenfeld
Akerman
Boies Schiller Flexner
Bracewell
Carter Ledyard & Milburn
Clyde & Co
Crowell & Moring
Day Pitney
DLA Piper
Jones Day
Kilpatrick Townsend
McDermott Will & Emery
Morgan Lewis & Bockius
Pillsbury Winthrop Shaw Pittman
Ropes & Gray
Seyfarth Shaw
Schulte
Sidley Austin
Steptoe
Troutman Pepper
*Incorporates research posted on LinkedIn by Chris Griffiths, head of sales, Pirical Legal Professionals
