Dewey & LeBoeuf’s Italian partners are attempting to leave the firm’s US LLP as a way of strengthening their position if the troubled firm goes under.
Milan and Rome partners are currently negotiating an exit from the legal entity while remaining part of the firm, reducing their liabilities if the firm collapses following over 65 partner exits since the start of 2012.
It is understood that breaking away from the US LLP would effectively ringfence the Rome and Milan offices’ assets, meaning that the partners can continue operating without assets being seized in the case of the firm dissolving.
Meanwhile, the Italian teams are in talks with other firms about a mass defection, after similar discussions with DLA Piper fell through.
A Dewey Rome partner commented: “Given the situation, everyone is worried.”
If Dewey does go under, it is thought that partners who have left the firm, and are owed capital that they had put into the business, are in a better position than current partners because they would have the status of creditors rather than shareholders and could recover their money.
As The Lawyer reported this week, Dewey partners are owed hundreds of thousands of dollars each in partner capital invested in the firm while they were members. Dewey requires equity partners to leave 37 per cent of their target remuneration in the firm, paying them back in three instalments over three years (16 April 2012).
All of Dewey’s non-US offices converted from a multinational partnership to a limited liability partnership (LLP) last year. There are a number of different LLPs, including a London and Paris one.
Dewey & LeBoeuf Studio Legale, the Italian operation, is currently part of the US LLP.
Aside from Italy, the Russian, Polish and French offices are understood to be facing some large departures, with partners in Moscow and Warsaw in discussions with US firms.
Over 65 partners have quit the US firm in 2012, with eight exits emerging on Tuesday (17 April 2012) following the exodus of a highly regarded London and Dubai capital markets team on Monday (17 April 2012).