Rowe & Maw merger gets Illinois blues

Rowe & Maw and Mayer Brown & Platt will not be able to merge fully until the State of Illinois gives the go-ahead for limited liability partnerships (LLPs)

The news comes in the wake of the firms' deal to create a $614m (£434.7m) law firm – the tenth-largest in the world.
In the meantime, the UK partnership will be widened to become a multinational partnership and will subsume Mayer Brown's London office. The Mayer Brown US partnership, headquartered in Chicago, will remain technically apart from that of the London office, although the two firms officially 'combined' from last Friday, 1 February.
Corporate partner Peter Dickinson said: “It's a merger, but effectively there will be two partnerships which for tax purposes are separate.”
Corporate partner and head of the London office Paul Maher said: “We had half a dozen partners who said it was a great deal, but they were very worried about picking up joint and several liability. So for now we're retaining two partnerships. The structuring before we can move to full-blown LLP status is very tricky.”
There is little sign, though, that Illinois will change its position on LLPs in the near future. Litigation head Sean Connolly said: “They don't have the legislation in place. There's lobbying going on.”
If Illinois remains the same, Mayer Brown Rowe & Maw may end up as a New York LLP, although its Illinois-registered lawyers will still be unable to be part of it. It will operate on an interim arrangement until the liability issue is sorted out. Both partnerships will generate profit pools, which will feed into the combined remuneration stru-cture. The combined firm will adopt the Mayer Brown equity share-out.