Dozens of Big Law Firms Received Millions in PPP Loan Funds
At least 45 law firms in the Am Law 200 received SBA loans this year.
July 06, 2020 at 01:35 PM
5 minute read
The original version of this story was published on The American Lawyer
This article has been updated to include more names and comments from some firm recipients.
More than three dozen Am Law 200 firms—and scores of other law firms across the country—have received paycheck protection loans from the Small Business Administration, including Boies Schiller Flexner, Kasowitz Benson Torres and Hughes Hubbard & Reed, according to recipient data released by the SBA on Monday.
The names of applicants applying for loans of more than $150,000 range from some of the largest Am Law 200 firms, such as Boies Schiller, already in the news for a series of partner exits this year, to many prominent midsize firms and plaintiff firms.
In March, Congress earmarked $350 billion in funding to dole out as business loans amid the coronavirus pandemic and the economic turmoil that has followed. While restaurants, health care firms and car dealerships were some of the top recipients of large loans, law firms and lawyers were also eager to apply.
In all, Law.com found at least 45 law firms in the Am Law 200—more than a fifth of the nation's 200 highest-grossing law firms—that received SBA loans this year.
The following Am Law 200 firms—which all posted gross revenues of more than $100 million in 2019—have received between $5 and $10 million loans:
- Boies Schiller Flexner
- Thompson & Knight
- Wiley Rein
- Schiff Hardin
- Armstrong Teasdale
- Hughes Hubbard & Reed
- Kasowitz Benson Torres
- Robins Kaplan
- Spencer Fane
- Pryor Cashman
- Cole, Scott & Kissane
- Stroock & Stroock & Lavan
- Kobre & Kim
- GrayRobinson
- Kelley Drye & Warren
- Bond, Schoeneck & King
- Hodgson Russ
- Honigman
- Sherman & Howard
- Lewis Roca Rothgerber Christie
- Allen Matkins Leck Gamble Mallory & Natsis
- Knobbe Martens
- Day Pitney
- Robinson & Cole
- Morris, Manning, & Martin
- Ice Miller
- Adam and Reese
- Phelps Dunbar
- Miles & Stockbridge
- Miller, Canfield, Paddock and Stone
- Butler Snow
- Cole Schotz
- Gibbons
- McElroy Deutsch Mulvaney & Carpenter
- Benesch
- Porter Wright Morris & Arthur
- Shumaker, Loop & Kendrick
- Procopio, Cory, Hargreaves & Savitch
- Rutan & Tucker
- Smith, Gambrell & Russell
Meanwhile, Am Law 200 firms that received $2 to $5 million loans include Shutts & Bowen; Curtis, Mallet-Prevost, Colt & Mosle; Arnall Golden Gregory; Hinckley, Allen & Snyder; and Sullivan & Worcester.
For some of the firms who received money, the PPP loans were key to avoiding the mass layoffs and furloughs that have rippled through the industry.
Thompson & Knight said that it applied for the loan because its "primary goal during these uncertain times is to protect our people, continue to provide outstanding service to our clients, and to give back to the communities we serve."
A Kasowitz spokeswoman said that their loan, in addition to "substantial cost-saving measures and greatly reduced partner distributions," allowed the firm to retain hundreds of employees at full salary and benefits "without interruption."
And while there were dozens of Am Law 200 firms that received loans, the majority of law firms that applied for PPP monies are small and midsize firms making less than $100 million.
High-end California intellectual property boutique Keker, Van Nest & Peters received between $2 and $5 million.
Prominent firms outside the Am Law 200 that also received loans including Barclay Damon; Herrick, Feinstein; Best Best & Krieger; Rivkin Radler; Cullen and Dykman; Morrison Cohen; Moses & Singer; Olshan Frome Wolosky; Mendes & Mount; Phillips Nizer; Carter Ledyard & Milburn; Cohen & Gresser; Labaton Sucharow; Phillips Lytle; and Seward & Kissel.
Kent Zimmermann, a law firm management consultant at Zeughauser Group, said that receiving a PPP loan doesn't necessarily mean that a firm is in financial trouble. Almost every firm he has spoken to during the pandemic at one time considered a PPP loan, and most of the larger Am Law 100 firms, he added, didn't even qualify.
"Some firms faced existential threats going into this downturn and a small group still face existential threats," Zimmermann said. "And I personally don't think that it's necessarily fair to shame organizations that complied with the law."
Wigdor LLP, which has notably represented Vanina Guerrero in an EEOC complaint against DLA Piper related to partner Louis Lehot and who has filed a flurry of suits against Fox News, was approved for an April loan between $350,000 and $1 million, according to the government's data. Wigdor partner Douglas Wigdor said that the firm withdrew its application and never received the funds.
Honigman has already paid back its loan.
"Honigman had determined to pay back the PPP loan prior to the expiration back in May, prior to the expiration of the safe harbor period," said Kevin Kiefer, the firm's director of business development.
Going forward, many firms, after facing down the initial turmoil and uncertainty in March, have been pleasantly surprised by a steady level of productivity, Zimmermann added. And some firm partners are already clamoring to receive their full draws, he said. But when taking into account rising cases in several states and subsequent rollbacks of reopenings in states like Florida and Texas, he adds that there may be a second economic wave threatening law firms in the near future.
"It ain't over yet," Zimmermann said.
Ryan Barber and Ben Hancock contributed to this report.
An earlier version of this article incorrectly described the type of action against DLA involving Louis Lehot. It was an EEOC complaint, not a lawsuit. The article has also been updated to reflect Wigdor's statement that his firm withdrew its application and didn't receive the loan money.
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