Legal News

Is Handwriting on the Wall at Heller Ehrman?

By Dan Slater

It could be wind-down time at Heller Ehrman, the once-high-flying San Fran-based litigation shop whose fortunes have nose-dived. The Recorder reports that firm management held a firm-wide videoconference yesterday afternoon to update the partnership on the status of the firm’s line of credit, opportunities for groups and offices, and “plans for an orderly transition (or wind down),” according to an e-mail announcing the meeting.

Also Wednesday, firm Chairman Matthew Larrabee sent out a firm-wide e-mail apologizing for keeping discussions of the firm’s fate under wraps, and promising clearer communication later in the week. Click here for the memo, courtesy of Above the Law. “I am profoundly sorry that I have not been in direct communication with you recently. We realize that there has been a lot of news coverage about our firm, and it is wrong to have that be your source of information,” Larrabee wrote, later promising, “we are planning to hold meetings with everyone before the end of this week via videoconference and/or local, in-person discussions.”

Because the firm recently lost 14 IP lawyers to Covington & Burling, reports the Recorder, Heller’s management was required to notify the bank or banks supplying the firm with its line of credit. Should Heller’s debt be called in, the firm’s hope for an orderly dissolution would be frustrated, a partner told the Recorder.

“If they’re willing to wait and get repayment as we collect, that’s not a problem,” the current partner said. “But if they tell us tomorrow, ‘We want our money,’ that takes a not-insignificant portion of our existing cash and it’s hard to operate without any cash.”

Full post as published by Law Blog - WSJ.com on September 25, 2008 (boomark / email).