The partnership council of Thelen Reid Brown Raysman & Steiner, Pinsents Masons’ former US alliance firm, has confirmed that it is recommending the dissolution of the firm. It is expected Thelen will close its doors for the last time on 1 December this year.
The US firm’s partnership council recommended a vote for dissolution today (28 October) in a crisis meeting with the firm-wide partnership. The partnership now has seven days to vote on the recommendation.
In a statement, Thelen highlighted poor economic conditions and mass defections as the catalyst for dissolution.
“For the past several months, Thelen management has aggressively sought a full firm merger,” the statement said. “Unfortunately, the most promising merger opportunity was derailed by conflicts, and all other full firm merger discussions terminated last week.”
The firm is in default of its primary credit agreement, having breached a partner departure covenant that restricts the number of partners who may depart within any 12-month period.
As a result, Thelen’s bank now has control over expenditures. The firm’s management is in discussions with the bank regarding its wind-down budget, which will allow the firm to continue paying certain expenses.
Management has appointed a three-partner administrative committee to work with the bank and conduct the wind down process. Partners will not receive profits, but will receive minimum draws up to 15 November.
Thelen said it would pay its employees 60 days salary as well as all accrued vacation pay.