Screenshot of CKR Law website

CKR Law's managing partner Jeff Rinde announced last week that his firm had struck a "strategic alliance agreement" with a Chinese law firm.

The twist? It wasn't the same Chinese law firm that New York-based CKR said it had been in negotiations with.

About a month ago, CKR said it was in talks to form a new firm entity with Yingke Law Firm, a huge but relatively loosely structured firm of Chinese lawyers. But on Tuesday, the firm announced that it had teamed up with Jingsh, a similarly large firm in China that has undergone rapid growth in recent years. Only later on Tuesday did CKR say that the talks with Yingke had ended.

What's left unsaid in all of CKR's latest announcements is that the New York firm continues to experience partner departures. The firm's website once boasted that it had more than 200 lawyers across 50 locations. But ALM is unable to determine CKR's current head count, and the firm did not respond to a request for comment on its headcount and questions about its operations and affiliations with Chinese firms.

CKR's announcement about the fizzled deal with Yingke said "uncertainties in the current political and economic environment and the anticipated costs of creating and building a new law firm" were behind their decision not to create the new firm. It's not clear what factors changed in the month-long exploratory period.

On the same day, CKR said it had signed a long-term strategic alliance with Jingsh, calling it Beijing's largest legal practice and one of China's largest law firms.

CKR said it will cooperate with Jingsh in marketing, client service and client referrals, and "this will include each firm employing certain of the other firm's lawyers as foreign legal consultants, bilateral lawyer exchanges," and joint efforts in seminars and training presentations for their attorneys, staff and clients.

CKR said the parties intend to "jointly pursue U.S., China and other global opportunities through the sharing of information, financial resources, offices, alliances, affiliations and clients."

Jingsh is in expansion mode. The CKR announcement came just days after Jingsh announced that it would open an office in Dusseldorf, Germany, next month and touted the opening of its North American Business Consulting Center in Toronto. Jingsh described the center as a "one-stop" source for "professional legal business services" and a pillar of support for China's Belt and Road Initiative, a massive push to increase international investment.

Yang Jianhua, the managing partner and CEO of Jingsh (who formerly led Yingke's Beijing office), told ALM his firm had more than 3,500 lawyers in China, including more than 1,000 in Beijing. He said the firm was in the process of setting up a New York office and said CKR would act as a "consultant" in that process. He added that the firms had not agreed to merge.

For its part, Yingke has said it isn't slowing down. Mei Xiangrong, Yingke's global chairman, told ALM that the decision to call off the new firm was made after due diligence. Yingke will pursue its own U.S. office independently, he said. Li Yongyuan, who also goes by Henry Li and is a partner and head of the firm's China-U.S. cross-border practice team, said in an interview that the firm is looking to create its own offices in the U.S. by late October or early November with five or 10 laterals.

"The [CKR] deal was not approved by the executive committee," he said. "It was a friendly termination. We are still friends with Jeff Rinde and other partners at CKR."

The 'Root' of Problems?

CKR's announcements about two Chinese firms follow several lateral exits. The co-chairs of CKR's corporate practice were among three attorneys who left to join Sichenzia Ross Ference earlier this month. Meanwhile. a group of ex-CKR lawyers are now listed on the website of Intelink Law Group, and Michelman & Robinson and Robinson Brog Leinwand Greene Genovese & Gluck have each added two former CKR partners. At least two of its lawyers are now at Taylor English Duma, and others have gone back to running their own firms.

ALM first reported in May that CKR hadn't paid partner draws in months. Rinde and Michael Maloney, another top lawyer at the firm, assured partners that the money was merely hung up because of problems with banks. Later, however, they blamed partners for not bringing over the volume of business they claimed to have or said billings came in below targets.

Several people familiar with the firm have told ALM that some departed partners are owed five or six figures, and some former CKR lawyers are mediating with the firm. Other partners are owed significantly less or have reached settlements that typically saw them walk away with their receivables or unbilled work-in-progress, sources said. Rinde, CKR's managing partner, has previously said the firm "intends to honor its commitments" to "performing partners."

One former senior partner at the firm said the cash crunch stemmed, in part, from Rinde offering overly generous terms to many early partners. "Even if they didn't bring the books of business that they promised, he signed contracts that no businessman should have signed," the former senior partner said. "You don't bring a partner over and promise to pay them X dollars without any reciprocal promise from that partner."

Still, this former partner said, many lawyers had books of business in the hundreds of thousands or low millions. The former partner said the "root" of the problem was not a lack of business, but bad business decisions, citing as an example the firm's dealings with Hammond Law Group, an Ohio-based immigration law firm with four offices. 

CKR announced in June that it had finalized a "strategic relationship" with Hammond Law Group that entailed referrals and close cooperation. Three people told ALM that the firms had been closely integrated, however, with CKR issuing paychecks to some Hammond lawyers and staff and paying some of its lease expenses. But the new expenses weren't offset with rising revenues from the deal, the former partner said.

Michael Hammond, the firm's founder, said CKR didn't go so far as assuming the leases, nor were all Hammond Law Group lawyers on CKR's payroll, but he confirmed that CKR paid for some of the firm's leases and was paying some of its employees. That is no longer the case, he said.

Rinde declined to be interviewed and did not respond to written questions about the Jingsh and Yingke arrangements. He also did not respond to a request for comment about the former partner's comments.

Anna Zhang contributed to this report.