Ex-Dewey chair faces prosecution over 'misconduct', Greenberg deal shelved
Dewey & LeBoeuf’s former chairman Steve Davis has become the subject of a criminal investigation by the Manhattan district attorney’s office, with the news coming amid reports that the US firm has called off talks about a possible merger with Greenberg Traurig.
Steve Davis
Davis has been ousted from his position in the so-called office of the chairman after state prosecutors launched the probe against the firm’s former chief, according to US press reports.
A group of partners at the embattled firm presented evidence to the district attorney about alleged financial misconduct by Davis, according to the reports.
The firm informed partners of the investigation in a memorandum on Friday, announcing that it has instructed Dewey New York litigation partners Harvey Kurzweil and Seth Farber to act as counsel to the firm and conduct an internal investigation.
Kurzweil’s experience includes acting for the receiver of Chicago-based WexTrust Capital, which collapsed in 2008 following accusations that two of its executives had run a $255m Ponzi scheme.
Davis announced his removal from his management position in an email to the firm yesterday, with the memorandum also revealing that the firm had ended widely reported discussions over a potential deal with Greenberg Traurig.
Davis, who led the 2007 merger of Dewey Ballantine and LeBoeuf Lamb Greene & MacRae on the LeBoeuf side, was effectively removed from his senior position as chairman a month ago when the role was transformed into a five-partner ‘office of the chairman’ consisting of Davis and four key practice and office heads (28 March 2012). The latest revelation sees him removed from that group altogether and from the executive committee.
The Lawyer reported earlier this month that senior bankruptcy partners at Dewey were working on a potential merger or sell-off of the firm (19 April 2012).
Separately, corporate partner Gary Apfel has become the latest high-profile departure from the firm and the 73rd partner to leave in 2012, with the Los Angeles lawyer quitting late last week for an unknown destination.
2012 departures have now risen to 75, with New York finance partner Marshall Stoddard joining Morgan Lewis & Bockius and Dubai disputes partner Peter Gray leaving for Gibson Dunn & Crutcher. Gray was the firm’s last-remaining Dubai partner following the departure of Gavin Watson and Chris Sioufi for Dechert (16 April 2012).
Dewey was not immediately available for comment.
Readers' comments (5)
Anonymous | 30-Apr-2012 11:47 am
Is it likely that the banks will agree to extend the current banking facilities at a time when there is an investigation of this nature taking place?
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Anonymous | 30-Apr-2012 1:34 pm
Borrowing money to feed draws = greed = downfall of firm.
Was Davis the only one speaking with the banks? Yeah, sure, that's the story. Yeah, that's it.
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Apollinaris | 30-Apr-2012 6:22 pm
Remember, you hungry hyenas, NOT GUILTY UNTIL PROVEN! Has it been proven that the "group of partners at the embattled firm presented evidence to the district attorney" and the Dewey New York litigation partners, Harvey Kurzweil and Seth Farber, acting as counsel to the firm and conducting "an internal investigation" are free from sin? The Bible says,“Let any one of you who is without sin be the first to throw a stone." Where are the stones thrown by the Dewey partners? I don't see any. I am sure when all the "investigation" is done, a moraine of stones will be rolling down the Rocky Dewey Mountain. Take my word.
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Anonymous | 1-May-2012 9:03 am
It's over.
Good luck to everyone at Dewey in London.
I hope you all land in a good home.
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dragonfly | 4-May-2012 6:33 am
I hope all the firms who have taken DLB partners are ableto ringfence any debt / post move difficulties that ex DLB partners migh carry with them post the coup de grace that must be soon.
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