LeClairRyan has started the process of dissolving, according to several sources with knowledge of developments within the firm.

The Virginia-headquartered Am Law 200 firm has been shedding partners for months.

Multiple sources have said LeClairRyan lawyers and staff have been encouraged to seek employment elsewhere. Some support staff have been laid off in the last week, two sources said.

One source with knowledge of the firm confirmed last week that partners who have left the firm have not been repaid for their capital contributions.

Firm attorneys have been told a wind-down committee is in the works, sources said, and partners are eyeing a few different law firms where large groups might land. For instance, a group of attorneys is talking with Northeast regional firm Barclay Damon. That firm's managing partner, John Langan, declined to comment.

Elizabeth Acee, with LeClairRyan. Elizabeth Acee of LeClairRyan.

Reached by phone Wednesday, LeClairRyan CEO C. Erik Gustafson declined to comment on the firm's plans.

Last week, co-founder and name partner Gary LeClair left the firm for Williams Mullen with two other LeClairRyan lawyers in Virginia. A day earlier, Fox Rothschild announced that it was taking a group of 15 aviation lawyers from LeClairRyan.

On the heels of that group's announced departure, LeClairRyan president Elizabeth Acee acknowledged that the firm was unsure about its next steps, saying in a statement that “we are considering options.”

Meanwhile, the firm was sued July 10 in James City County Circuit Court by one of its landlords over $348,000 in rent for its Williamsburg, Virginia, office. The four lawyers in that office left for Gordon Rees Scully Mansukhani in February. The firm currently lists 21 offices on its website, including six Virginia locations.

In June 2018 LeClairRyan reached a deal to outsource 300 of its employees to the alternative legal services provider UnitedLex Corp., forming a joint venture called ULX Partners to provide services to the firm, and eventually to other law firms. But the deal did not stem declines in revenue and head count that have beset LeClairRyan since 2015. The firm's gross revenue fell to $122 million in 2018, sliding from $142 million the year before.

Reached for comment Wednesday, a spokesperson for UnitedLex said in a statement, “LeClairRyan remains a client of UnitedLex and we will continue to provide support as needed.”

While current and recently departed partners were unwilling to comment on the record about the state of the firm, some LeClairRyan alums suggested the origins of its troubles ran deep. Michael Volkov, a white-collar partner in Washington, D.C., who left in 2013, blamed leadership and compensation decisions that long predated the firm's partnership with UnitedLex. As for what's unfolding there now, he summed up, “What a disaster.”