In a firm-wide ‘all hands’ videoconference on Thursday afternoon, chairman Matthew Larrabee said the partnership had concluded that dissolution was unavoidable.
Larrabee described the dissolution of the firm as a tragedy for the entire legal industry and, after about 10 minutes, turned the meeting over to partners in each of the firm's offices for in-person question-and-answer sessions.
All employees were told they would be paid for 60 days, with a small group of staff to be retained after that.
Shareholder Jonathan Hayden called it an incredibly sad day. "As somebody who is an owner here, my heart really goes out to everyone who works here," said Hayden, who has been with the firm since 1981. "They are the ones who made us successful."
During a New York office meeting following Larrabee's talk, a partner there said the firm expects to collect at least 90% of an estimated $118m (£64m) in accounts receivable, and has about $6m (£3.3m) in cash. Including unbilled work, the firm stands to collect about $160m (£87m), another partner said. The
Management told partners in a Wednesday meeting that Heller's banks seized control of accounts receivable, unbilled time and expenses this week, a current partner said. The banks' decision came after the departure of 14 IP litigators, announced on 14 September, triggered a clause in the contract governing the firm's line of credit. The firm hopes to dissolve without declaring bankruptcy, that partner said.
Firm management also told partners they would not receive their September draws, a partner at Wednesday's meeting said.
At a partner meeting on Wednesday afternoon, Heller management said they expected to hear proposals over the weekend for large chunks of the firm. Topics to be discussed include individual pay and obligations they will take over. One-time merger candidates Baker & McKenzie and Winston & Strawn are said to be leading contenders to take on a sizable portion of Heller.
See Editor's Blog: Heller’s familiar fate for more analysis.The Recorder is a
