A trickle of partner defections in March turned into a torrent, with at least 250 of Dewey & LeBoeuf’s 304 partners finding new jobs. All five senior partners named to a new chairman’s office in March have left, and the firm faces a criminal probe. The staff at the firm’s Manhattan offices has been gone for more than a week. Joff Mitchell of Zolfo Cooper, a restructuring company, is running things.
Mitchell’s task is to wind the firm down while dunning former clients for bills they have little incentive to pay in full. That’s bad news for the firm’s creditors, including bank lenders owed at least $75 million and bondholders owed $125 million or more. Other creditors range from partners who got pay guarantees worth about $100 million to the firm’s janitors, who have sued for about $300,000 in unpaid bills.
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