Cadwalader boosts partner profits by 28% as revenues fall 10%

Cadwalader Wickersham & Taft has posted a 28% increase in profits per partner, the firm's first positive results since 2007, reports The Am Law Daily.

Profits per partner at Cadwalader rose to $2.4m (£1.5m) for 2009, while revenue per lawyer climbed by 3% to almost $1m (£614,000).

However, the US firm saw revenues fall by 10% to $456.5m (£280.5m) for the year, a drop that Christopher White (pictured), the firm's chairman, called "very strong in light of a steep contraction in the finance market."

The results compare favourably to those the firm posted in 2008, when revenues fell by 13.8% and profits per partner dropped by 30%. Partner profits peaked at the firm in 2006 at $2.9m (£1.8m), before contracting over the next two years as the credit markets began to tighten.

White attributed the firm's 2009 financial results to its work on large corporate and restructuring deals last year and to cost-cutting measures the firm implemented early on in the recession.

In 2008, Cadwalader announced layoffs affecting 131 associates, job cuts that preceded much of the rest of the legal industry. The firm also announced layoffs affecting 25 lawyers around the world in early 2009, while in July, the firm offered a one-year sabbatical to 34 lawyers. Cadwalader had a total of 457 lawyers at the end of August 2009, down 12.6% from a year earlier when the firm had 523.

"We continued to adjust to the contraction in the financial markets, and in 2009 recognised the benefit of the very difficult decisions that we made in 2008," White said.

Some of the increase in Cadwalader's partner profits can be attributed to a 21% decrease in the number of equity partners - the firm had 61 equity partners at the end of August 2009, compared to 77 one year earlier.

White says the smaller partner pool was a result of partner departures early last year. In January 2009, Bruce Zirinsky, previously co-chair of the firm's bankruptcy practice, left for Greenberg Traurig with another partner, and during the same month, the firm lost seven partners in London to Paul Hastings Janofsky & Walker.

More recently, two New York real estate partners - Alan Lawrence and John Busillo - left for Arnold & Porter.

Cadwalader advised on some of the largest transactions announced in 2009, including Pfizer's $68bn (£42bn) takeover of Wyeth, while the firm also represented CVC Capital Partners in its bid to acquire Barclays' asset management business iShares.

Cadwalader also acted as the Treasury Department's bankruptcy counsel for the restructuring of Chrysler and General Motors under an $8.6m (£5.3m) contract.

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