Virginia-headquartered Hunton & Williams will be the main beneficiary of the fallout from Texas firm Jenkens & Gilchrist, taking on 93 of its 124 lawyers.
Jenkens collapsed spectacularly this year and announced its official closure on Friday, as reported on www.thelawyer.com (30 March). It did so with a $76m (£38.72m) settlement with the US Internal Revenue Service (IRS) for advising on fraudulent tax shelters.
Hunton’s mass hire includes Jenkens managing partner Patrick Mitchell, who will become office managing partner for Hunton in Dallas.
Hunton managing partner Wally Martinez said: “We’ve always been interested in increasing the depth and breadth of our practice in Dallas specifically, and Texas more generally, if the situation was right.”
Jenkens confirmed to The Lawyer (5 March) that it had been in advisory talks with Hunton about taking on a number of the firm’s Dallas-based lawyers.
At that point Jenkins’ Chicago, Los Angeles, Houston, Austin and San Antonio offices had been closed, with just the Dallas headquarters – home to 124 fee-earners – remaining.
Jenkens’ problems began in 2003 when a federal investigation found that several tax shelters, which were endorsed mainly by Jenkens’ Chicago-based lawyers, were in fact illegal.
The firm spent three years controlling the damage, including firing the partners responsible and making an $82m (£41.74m) settlement with 1,100 tax shelter investors in 2006.
A firm spokesman confirmed that Jenkens had met its financial obligations for 2006, although he was not able to provide figures.