The Legal 500

Asia Pacific Legal 500

Hong Kong

The past year has seen a dramatic change in the fortunes of the Hong Kong legal market. The collapse of Lehman Brothers in September 2008 triggered a sea change in the global financial climate, and within just a few weeks, capital markets activity dropped off a cliff, fundraising ground to a halt, and the size and volume of existing deals was much reduced.

Even as the situation began to show signs of improvement in the spring of 2009, there was still an air of uncertainty, with investors taking a much more conservative approach and focusing on risk management, moving away from highly complex structured products to more straightforward lending. Read more...

The UK Legal 500

London - Finance

The turbulence in the financial markets in 2008 was epitomised by the historic demise of Lehman Brothers; the ramifications of this event were felt throughout the markets and caused a paralysis in the flow of credit. The effect on law firms has been widely reported, with many experiencing widespread redundancies. Firms that have coped best with the implosion in the markets have been those less regimented in their approach to finance, with the flexibility to adapt to the conditions. Against this background, the Magic Circle firms continue to lead the way, with Allen & Overy LLP, Clifford Chance and Linklaters LLP appearing in the top tier of the majority of the categories in this chapter. However, as the value of deals migrates downwards, there is increased competition in the mid-market, and firms with a strong regional base, and the ability to compete on cost have become increasingly attractive propositions to clients facing their own cost pressures.

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The UK Legal 500

Yorkshire and the Humber

Home to the ‘Big Six’, Leeds is a closely fought market which many claim has reached saturation. However, this has not deterred a number of recent new entrants, including Ward Hadaway and DWF LLP. Distance from the capital has afforded the main regional legal centres with little protection, and the downturn continues to bite hard in Yorkshire with redundancy announcements increasingly common. The recession has already claimed its first victims, including Fox Hayes LLP, which folded at the beginning of 2009.

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Asia Pacific Legal 500

India

India has remained to some extent shielded from the global economic crisis and law firms are consequently reporting a relatively strong year across the board. Although it has dwindled slightly, international investment is still ongoing and the number of corporate deals is steadily on the rise. Many firms have seen the economic crisis as an opportunity to hire talent from the west, with Srinivas Parthasarathy joining Trilegal from Allen & Overy’s Singapore office; Naval Chopra joining Amarchand & Mangaldas & Suresh A. Shroff & Co in New Delhi from Freshfields Bruckhaus Deringer LLP; and Manan Lahoty joining Luthra & Luthra from Shearman & Sterling LLP’s London office, to head the capital markets offering.

As international firms are currently prohibited from practising in India, many foreign firms have chosen to establish alliances with domestic counterparts. The past 12 months have seen Clyde & Co LLP announce its association with ALMT Legal; Allen & Overy LLP enter into a non-exclusive referrals relationship with Trilegal; and Clifford Chance declaring its alliance with AZB & Partners. All such associations might be seen as a sign of firms positioning themselves for the potential liberalisation of the legal market. Firms such as Ashurst LLP continue to work from liaison offices on the ground. Read more...

The UK Legal 500

Given the counter-cyclical nature of dispute resolution, the current global economic downturn would seem the perfect environment for practices in this area. Certainly the number of reported enquiries has risen, and these are slowly translating into concrete instructions, but the tsunami of litigation that was predicted in some quarters has yet to arrive.

Thus far, the main beneficiaries have been those firms with strong backgrounds in banking and commodities, sectors which were the first victims of the fallout of the credit crunch and the resultant downturn. The former category is largely made up of Magic Circle and major City firms, such as Allen & Overy LLP, Clifford Chance, Freshfields Bruckhaus Deringer LLP, Linklaters LLP, Herbert Smith LLP, Lovells LLP, Simmons & Simmons, and Slaughter and May, all of which have excellent track records in financial services related disputes. In the latter, firms with strong experience in areas such as shipping, including Clyde & Co LLP, Ince & Co, and Holman Fenwick Willan LLP, have benefited from an uptick in disputes, thanks largely to major fluctuations in commodities prices.

The UK Legal 500

Scotland

Edinburgh and Glasgow: The country’s transactional landscape has long been dominated by the so-called ‘Big Four‘, although the gap in turnover between the largest, although the gap in turnover between the largest, Dundas & Wilson CS LLP, and the smallest, Shepherd and Wedderburn, continues to widen. The group is completed by Maclay Murray & Spens LLP & Spens LLP and McGrigors LLP, which opened a new Manchester office in 2008.

While no legal market is immune from the impact of the credit crunch, Edinburgh’s reliance on financial services has seen it suffer more than most. The well-publicised travails of RBS and Bank of Scotland, which collectively employ 15,000 staff in Scotland’s capital and represent key sources of instructions for the country’s legal elite, has been of particular consequence. And with RBS and Bank of Scotland both becoming more London-centric following their respective part-nationalisation and acquisition by Lloyds TSB, concerns remain over the long-term significance of Scotland to each institution.

The US Legal 500

FINANCE: Corporate restructuring

Given the counter-cyclical nature of corporate restructuring work, the recent credit crunch has led to an increase in the volume of work handled by lawyers in this area of law. Although Chapter 11 filings are now occurring with increased regularity and across almost all industries, the expected glut of bankruptcies was, however, a considerable time in coming. Indeed, the tail-end of 2007 and the first few months of 2008 were relatively quiet for corporate restructuring lawyers. While the sub-prime induced credit crunch had already taken hold of the economy, this took time to filter through to corporate balance sheets. Apart from a continuation of instructions on ongoing bankruptcies, a good deal of work handled by firms in this period related to counseling and advisory work about the potential trouble that lay ahead.

Ultimately, however, all this changed and corporates from all industries are either seeking out-of-court restructuring or under Chapter 11 protection. Of course, it was the financial services industry that was the first major casualty of the tightening of credit in the market. Wall Street has been decimated, investment banks saddled with exposure to risky mortgage backed securities, had billions wiped of their value. Paranoia was rife, with banks uncertain as to how much exposure their competitors had to the toxic securities, inter-bank lending dried up. Therefore, what began as a seemingly containable problem in one part of the mortgage market threatened the integrity of the US financial system. Read more...

Asia Pacific Legal 500

Japan

Though the Japanese economy proved more robust in the latter stages of 2008 than some of those in the West, the country’s legal market has not remained entirely unaffected by the global credit crisis. Firms saw renewed activity for insolvency practices that were just beginning to see the tail off of work from the restructuring boom of the ‘lost decade’, while structured finance practices saw a decline in instructions.

Most notably, offshore M&A activity was a huge driver for transactional practices heading into 2009. Japanese corporates and funds set about acquiring foreign assets and companies, particularly those based in the US. Mitsubishi UFJ Financial Group’s acquisition of a 20% stake in Morgan Stanley is a deal emblematic of the ambitions of cash-rich Japanese companies to take advantage of the circumstances in order to expand. Meanwhile, interest in emerging markets has also soared, fuelling the need for innovative financing techniques to fund companies’ forays into the energy and technology spaces of these jurisdictions. Read more...

The US Legal 500

MERGERS, ACQUISITIONS AND BUYOUTS: Antitrust

It has been an interesting period for antitrust lawyers in the US. On the transactional side, although merger activity has, on the whole, diminished as a consequence of the downturn in the economy and the unavailability of cheap credit, consolidation within the banking industry has brought about some challenging work for competition lawyers.

While it is too early to tell just how great its impact will be, the recent change to a Democrat administration is widely expected to usher in a period of stricter antitrust regulation. Indeed, a glance at President Obama’s election campaign statements regarding antitrust seem to bear this out. As well as declaring an intention to continue the government’s strict enforcement regarding cartel activity, he made some very strong overtures regarding heightened Department of Justice (DOJ) scrutiny of merger activity and dominant position abuse. Read more...

The Legal 500: Europe, Middle East & Africa

France

The economic slowdown did not prevent leading and mid-size law firms in France from posting strong results in 2008, with many firms even exceeding what they achieved in 2007.

A number of international law firms are now focusing on their core business areas at the expense of ancillary practices. As a result, a number of lateral moves occurred in 2008. Employment expert Joël Grangé joined Flichy Grangé Avocats from Gide Loyrette Nouel A.A.R.P.I., and Pascale Lagesse arrived at Bredin Prat from Freshfields Bruckhaus Deringer LLP. Freshfields Bruckhaus Deringer LLP also lost key partners from its finance practice, with Michel Quéré joining Dewey & LeBoeuf and Jean L’Homme moving to Proskauer Rose LLP.

Willkie Farr & Gallagher LLP hired bankruptcy partner Maurice Lantourne from Fried, Frank, Harris, Shriver & Jacobson LLP whilst Olivier Laude, former co-managing partner of Dewey & LeBoeuf, left to set up his new litigation boutique Laude Esquier Champey.

The Legal 500: Europe, Middle East & Africa

Germany

The German legal market has not been immune to the dramatic fallout from the sub-prime crisis. Consequentially there is a lack of confidence in the market. This has impacted on deal flows and law firms have noticed that many deals have been aborted, while many sources of funding have dried up considerably.

As a result of the turbulent economic times there have been fewer mega deals, however the mid-cap segment remains relatively unscathed. The crisis in the markets has had a negative impact on private equity deals, with some of the larger law firms steering a different course and concentrating more on the mid-market sector.

Insolvency lawyers witnessed a ‘crazy end to 2008’, with firms switching less busy lawyers to their insolvency department, in order both to make ends meet there and to take advantage of the situation. This trend is expected to extend throughout 2009 and into the following year. Similarly, the employment departments are seeing an increasing number of short-notice instructions.

IP has remained remarkably untouched, as practices are not relying on big corporate deals to bring in work. ‘While the market goes up and down, trade marks last forever’ seems to be the commonly held view.

The US Legal 500

LABOR AND EMPLOYMENT: Labor and employment litigation

The onslaught of wage and hour litigation continues unabated, although as the first wave passes, the focus has turned to cases of greater complexity or those relating to specific industries such as pharmaceuticals or construction. The most recent trend has been the spate of lawsuits alleging that pharmaceutical sales representatives have been misclassified as exempt from overtime requirements, which is a prime example of the new issues arising as claims are brought not by restaurant or retail workers but by highly-paid professionals.

The other main development in this area is the increase in litigation resulting from widespread reductions in force, as a hostile economic climate forces workers to scrutinize the reasons for their termination in more detail and makes them more likely to pursue claims of wrongful termination if they cannot secure employment elsewhere. Along with these trends, new legislation continues to fuel changes in the employment landscape and further developments are expected from the Obama administration. Read more...

The US Legal 500

FINANCE: Bank lending

Triggered by the subprime crisis, banks saddled with highly toxic mortgage securities have been forced into massive writedowns. Confidence was shattered and inter-bank lending ground to a halt, as banks were overcome with paranoia over each other’s exposure to these assets. With financial institutions rationing capital as they set to shore up their own debilitated balance sheets, liquidity dried up, making it difficult for even fundamentally sound businesses to secure funding, let alone ones with a more precarious credit history.

The mega-sized leveraged buyouts (LBOs) that until as recently as the middle of 2007 were
flooding the market, disappeared almost overnight.
Consequently, law firms that derived a high proportion of instructions from private equity sponsors have taken quite a hit. Indeed, in general, the practices that have coped best with the turbulent market conditions have been those with a diverse client base and also a degree of flexibility and ability to adapt to the conditions. Therefore, while senior secured syndicated transactions, investment grade and the like will still be considered, more so perhaps than in other years, the editorial will also look at asset-based lending, mezzanine financing and bankruptcy-related financing. Read more...

The Legal 500: Europe, Middle East & Africa

Ukraine

Serhiy Chorny heads the highly rated four-partner team at Baker & McKenzie – CIS, Limited. Recently the practice advised PrivatBank, Ukraine’s largest commercial bank, on the $110m securitisation of an autoloans portfolio, the first of its kind in Ukraine. Other clients include IFC, ING Bank and Standard Bank, which it advised on a $154m syndicated loan to First Ukrainian International Bank.

Magisters offers borrower and lender clients a broad-based practice that covers syndicated loans, capital markets, structured finance and project finance. The highly-regarded Olga Khoroshylova heads the ten-lawyer team which advised Ukraine’s Ministry of Finance on all its external state borrowings in 2007. Other clients include Alfa Bank, which it represented on several billion-dollar EMTN programmes, Credit Suisse, Erste Bank and Standard Bank.Read more...

The Legal 500: Europe, Middle East & Africa

Iceland

Everything has changed in the Icelandic legal market. Following the credit crunch-induced economic implosion in late 2008, the jurisdiction’s small corporate legal community have been forced to shift their focus almost overnight from supporting rapid, heady economic growth, built primarily on the perceived success of Iceland’s banking and financial sector, to becoming what one lawyer termed ‘firemen’, providing urgent advice to a crisis-stricken banking and business community. What had been a market increasingly dominated by a wave of sophisticated financing and optimistic outbound M&A transactions has become one where lawyers have quickly become experts on emergency bankruptcy law rushed through in response to the nationalisation of three of Iceland’s largest banks. In the short-term, Icelandic firms have thrived on advising the myriad of parties tied up in Iceland’s failed banking system, with smaller full-service practices finding themselves as heavily involved as dominant market players LOGOS legal services, BBA // Legal and Lex Law Offices. However, behind the frantic activity is an underlying uncertainty over how the legal market is likely to adapt in the long-term, to what is sure to be a vastly different, post-crisis environment.Read more...

The Legal 500: Europe, Middle East & Africa

Portugal

The past year has helped to measure the initial success of the numerous mergers witnessed in 2007, when Portugal’s legal market appeared to adopt a ‘bigger is better’ approach. While some firms have emerged stronger than before, others have had to come to terms with perhaps less fruitful attempts at expansion, resulting in a series of spin-offs and demergers.

One surprise departure was that of Pedro Cardigos, who left newly formed ABBC – Azevedo Neves, Benjamim Mendes, Bessa Monteiro, Carvalho & Associados – Sociedade de Advogados RL to launch Cardigos e Associados. Though the split is amicable, it nonetheless serves to highlight the unforeseen partner integration difficulties some firms have experienced.Read more...