Dewey's Sharp hits out at stricken firm's US management
Former Dewey & LeBoeuf London managing partner Peter Sharp has claimed that the firm’s New York chiefs “ignored” his plans to save the City office as he moved to refute allegations that he left his former colleagues high and dry.
Peter Sharp
Sharp, who resigned to join Morgan Lewis & Bockius’s City office at the height of the crisis, has launched an attack on the firm’s US management, following claims that the litigator looked after his own interests and broke a promise to go down with the ship.
“In mid-March I told [staff] I was not about to disappear. The situation changed,” Sharp told The Lawyer in an interview published today.
“There’s so much to this. We got to a point by mid-April where it became impossible to hold together any sort of London practice at Dewey & LeBoeuf. I’d also put a proposal to New York to try and hold together a team - I surveyed the office and put forward what I thought was possible, how that could be a viable practice. It was completely ignored.”
Sharp has become a villain among much of Dewey’s remaining staff, with four sources claiming that well before he left he went round vowing not to jump ship as hordes of partners globally were leaving.
A current Dewey associate said: “Peter had met with each of the floors in the building and his message was, there’s a rumour going round that I may be leaving, and I can tell you that that’s not going to happen. [He said] you will not see that headline. Of all the parallels with Captain Schettino […] He fell into the lifeboat, and he’s leading the rescue from the shore.”
But Sharp claimed that a meeting with partners on 20 April, when a number of them told him they were leaving, meant that the situation was no longer salvagable.
“That’s the point when I decided the only constructive thing I could do was try and find a safe home for as many people as possible,” he said.
“You have to make an on-the-spot decision. By that point it became clear to me that the firm was doomed. Everyone who made London what it was was planning to leave immediately.”
Sharp, who quit on 3 May, also blamed the situation on the significant financial pressure partners were under, with some London partners understood to have been forced into selling their houses to pay their tax bills following months of reduced pay.
He added: “Meanwhile, the bank that provided capital loans had notified us that no future facilities would be made available to Dewey partners.”
Today’s feature also reveals that two senior Dewey partners clinched a $3m (£1.9m) bonus on top of their $2.5m fixed profit share cap when the firm renegotiated its controversial guarantee packages in March this year. One star lawyer on $6.4m ended up with a $6.9m deal following the negotiations, despite an apparent intention to limit the widely-criticised scheme of guaranteeing pay to certain partners.
Meanwhile, remaining London staff are being left in the dark over the firm’s plans, with one current staff member telling The Lawyer that no communication has reached them about their situation as the UK LLP verges on administration.
Despite a source telling The Lawyer last week that staff had been told this was their last week, it has emerged that this only applies to those whose close contacts with partners meant they were well-informed. Nothing official had been sent out to staff at the time of writing.
Dewey called a meeting for partners and former partners who had left recently last Wednesday (22 May) to discuss the latest situation, with the UK LLP expected to have gone into administration last Friday (24 May) (22 May 2012).
A current Dewey employee told The Lawyer: “It’s a horrible time. It’s heartbreaking. I’ve been here a long time. It’s like a family here. It’s hard, to see so many people strewn across the City. It’s heartbreaking.”
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Readers' comments (31)
Anonymous | 28-May-2012 9:03 am
Yes Peter, we believe you.....who could possibly think you put # 1 first?
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Anonymous | 28-May-2012 10:20 am
20 April: decides to look for another firm. Finds a firm, starts and completes negotiations and leaves by 3 May. 7 working days from start to finish. That was a very quick negotiation, Mr Sharp. Congratulations.
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Anonymous | 28-May-2012 10:29 am
Let's face it Peter Sharp was ignored ever since the merger took place and was never involved in the day to day operations anyway. This whole mess is no surprise bearing in mind the various warnings over the last 2-3 years. The only surprise is that is has taken this long for the Partners to man the lifeboats. If I hadn't been paid my salary for 2009/2010 I would be pretty annoyed to be fair!
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Anonymous | 28-May-2012 12:33 pm
How can you say Peter was ignored and was never involved in the day to day operations? He attended all the Executive Committee meetings, all the London Policy Committee meetings and he was the head of the London office. No-one was more involved than Peter.
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Anonymous | 28-May-2012 1:47 pm
If he was that involved day to day then why didn't he stop this debacle snowballing bearing in mind all of the warning signs. A few examples that go back years not months.
Why didn't he stop the US diverting funds into their own bank accounts for London bills starving London of cash so they could not meet the monthly obligations?
Why didn't he ensure that vendors/landlords/taxes were paid on time? Or if obligations could not be met then at least reduce services accordingly?
Why didn't he make sure that capital commitments for leavers were honoured?
The fact is he was not involved in the day to day operations otherwise he would have seen this coming like the rest of us. The only guy that tried to cut spending and increase income was Steve Horvath hence why he was given the global role.
One final point is that if you accept the title Managing Partner along with the juicy compensation that comes with it then you should make it your business to know all of the above!
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Anonymous | 28-May-2012 2:26 pm
either delusional or (as he served on those committees) cowardly
mort pierce also claimed he didn't know what was going on despite being on all such committees in nyc
gimme a break - tells you who ends up leadership positions in law firms
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Anonymous | 28-May-2012 3:01 pm
Peter was head of the UK LLP, and is an English solicitor regulated by the SRA. As such, he owned the usual duties to the UK LLP and its creditors as a director, fiduciary duties to the other members of the UK LLP, and was obliged to comply with SRA regulations. It is surely not the case that he considered himself hamstrung by what New York wanted him to do. The discharge of his duties to the UK LLP, its other partners and the SRA would presumably have required him to exercise a lot more independent judgment than just relying on instructions (or lack of instructions) from New York. It seems lame to try to excuse his conduct on the ground that New York failed to tell him what to do.
Was he the managing partner, or not? We have lived though Emile Heskey, the non-scoring centre-forward, now do we have Peter Sharp, the non-managing managing partner? Sign him up as your assistant for the Euros now, Roy.
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Anonymous | 28-May-2012 3:52 pm
the fact that sharp negotiated the deal with morgan lewis in about a week is more down to morgan lewis being desperate to expand in london and therefore not doing much (if any) due diligence. so they have taken on a three partner litigation team in london where previously they had no disputes practice, and the entire moscow and almaty offices in countries where they had no presence. it appears to be a case of getting what they could, doing due diligence afterwards (over the next year or so?) and then right-sizing it later. maybe morgan lewis will make sharp the head of their london office now, and he can have the honour of sacking his dewey colleagues when it hasn’t worked out.
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Anonymous | 28-May-2012 4:48 pm
Sharp practices?
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Anonymous | 28-May-2012 5:34 pm
Breaking news-just formally gone into administration. Security passes will not work after 6pm!
By the way we will be deducting the balance of season ticket loan from your last paycheck even though any cancelled tickets will be refunded directly to us!
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