A number of former Dewey & LeBoeuf partners are grouping together in London and the US with a view to taking action to recover unpaid profit shares.
An informal faction of London ex-partners have assembled to make creditor claims against the potential administrators, BDO, who were brought in last Tuesday (1 May) as advisers on the London and Paris LLP’s wind-down.
Ex-partners are currently working on tracking down the right person at BDO to make a creditor claim. BDO has not yet confirmed which of its partners have been instructed.
The claims are expected to focus on the sizeable profit shares not paid to partners in recent years.
The situation is complicated by the fact that the London office was part of the security when the US firm issued its $125m bond in 2010 and its sizeable revolving credit lines from Citibank, meaning London partners could be liable.
“All ex-partners who are owed capital will have claims against the estate,” a former partner said.
Meanwhile, US ex-partners are gathering into groups to launch potential legal action against the executive committee and former chairman Steve Davis.
“There’s a group of partners in the States who are taking legal action. Also what is now emerging is what happened at the  merger [of Dewey Ballantine and LeBoeuf Lamb Greene & MacRae]. [Partners were] never informed about the level of debt. There’s a whole load of separate groups with various potential claims,” the ex-partner said.
The merger was pushed through fast, with former partners claiming that they were not informed about legacy Dewey Ballantine level of debt (16 April 2012).
The London ex-partners are not currently planning legal action, instead focusing on ensuring they have a claim a creditor claim when the firm is wound down.
Dewey was not immediately available for comment.
The news follows the departure of a string of Dewey partners in Europe in the latest exodus, with German capital markets partners Philip von Ilberg and Joseph Marx and local partner Martin Kniehase joining McDermott Will & Emery (2 May 2012).
The entire Moscow team (4 May 2012) as well as sole Almaty partner Aset Shyngyssov are joining Morgan Lewis & Bockius alongside London partner trio Bruce Johnston, Amanda Jennings and Amy Comer.