A dramatic year for Bingham McCutchen reached a crescendo last week, with the transfer of the bulk of the partnership to Morgan Lewis & Bockius providing the catalyst for the dissolution of the Boston stalwart, which had 1,000 lawyers on its books just over a year ago.

Bingham is expected to begin to be wound down in the next few weeks, once the 227 partners and a large proportion of Bingham's remaining 369 non-partner lawyers move over to Morgan Lewis.

Some 80 or so Bingham partners who have not signed up to the deal with Morgan Lewis are likely to seek roles at other firms, retire or, in a few cases, join Morgan Lewis as non-partner lawyers.

It is unclear how long the wind-down of the firm is likely to take, or whether it will involve insolvency. However, once complete, it will bring an end to a storied law firm whose legacy Bingham Dana & Gould operation dates back to the nineteenth century.

Sources on both sides of the deal tell Legal Week that the agreement has left Bingham's management and remaining partners in a position for an orderly wind-down, and that liabilities left with the firm will not exceed its assets.

For several months, a full merger had been touted as the most likely outcome
of protracted talks between the firms. Ultimately, however, the potential pitfalls of combining the two compensation systems, brands and partnerships are understood to have made an acquisition a more attractive proposition.

The disappearance of the Bingham brand – once a byword for quality in securities litigation, restructuring and competition work in the US – may be viewed as something of a loss to Morgan Lewis, though one source familiar with the deal argues that Bingham's strengths will continue to be recognised.

"People will still refer to these guys as the Bingham lawyers," he says. "Just look at the firm [Bingham] already: both internally and among clients when people talk about the tax group, it's still 'the McKee Nelson lawyers', even though they joined Bingham in 2009."

The mass hire was finalised last Friday (14 November), after Morgan Lewis partners voted to admit the bulk of Bingham's partnership. Morgan Lewis also voted through changes to the firm's partnership deed, which has been modified to lock in Bingham partners and their capital contributions.

Morgan Lewis – a debt-free firm before the takeover – will also assume some of Bingham's liabilities, and a large part of the discussions between the firms have been to ensure Morgan Lewis avoids any claims of fraudulent conveyance.

One obstacle- first reported by The American Lawyer earlier this month – that could have held up the deal was a multimillion-dollar malpractice claim brought against Bingham by one-time client and former Los Angeles Dodgers owner Frank McCourt, which was only resolved after merger talks began this summer. The settlement of the dispute was cited by two sources as crucial for the smoothing of last week's deal.

As for the transfer of various offices in Bingham's network, sources confirm that Bingham's Hong Kong base will move to Morgan Lewis, though licensing issues mean the office must operate as a stand-alone operation while the Philadelphia firm receives approval from the state's Law Society.

The acquisition of Bingham's eight-partner office in Santa Monica – a city where
Morgan Lewis has no base – is also understood to be part
of the deal.

Bingham has had a torrid 18 months after seeing revenue fall by 12.6% to $762m (£456m) in 2013, following a decline in US restructuring and securities litigation work and a general loss of confidence in the firm's strategic direction among sections of the partnership, alongside a number of exits.

The firm has also suffered a severe decline in its junior lawyer numbers. Bingham's most recent non-partner headcount – at the time the Morgan Lewis deal was struck – was 369, 26% down on the 497 who worked at the firm throughout 2013.

The mass exodus of Bingham's partners to Morgan Lewis comes just over a month after the departure of the bulk of the firm's London and Hong Kong offices, along with its entire Frankfurt base, to Akin Gump Strauss Hauer & Feld.

However, in an interesting sign of the two firms' confidence that a deal was still set to go ahead, Legal Week understands that, in the wake of the defection of their former colleagues in the City, Bingham lawyers in the US began sending the Morgan Lewis London office referral work on several corporate matters.

The test for a supersized Morgan Lewis – soon to be a 2,000-lawyer firm across 28 offices – will be to hold on to that early enthusiasm for collaboration while ensuring that the frenzied acquisition activity that led to some of the fault lines in Bingham's partnership aren't replicated this time round.

———————————————————————————————–

Bingham: the last 13 months

• October 2013: Corporate practice co-head Steve Browne (pictured) is appointed as the firm's first managing partner. Long-running chairman Jay Zimmerman takes on the chief executive role.
• February 2014: Financial results for 2013 reveal a global revenue drop of 12.6% to $762m (£458m), with PEP down 13% to $1.47m (£0.88m) and RPL falling 1.1% to $0.96m (£0.58m). Certain partners, including Zimmerman and management committee members, take a pay cut. 
• June 2014: Browne assumes leadership of the firm from Zimmerman, who agrees to remain in a strategic role until 2015. The managing partner promotes finance co-chair Daniel Papermaster, New York office head Anthony Carbone and employment practice head Debra Fischer into the senior management team.
• July 2014: Reuters first reports that Bingham has approached four firms with a view to finding a merger partner: Morgan Lewis & Bockius, Winston & Strawn, O'Melveny & Myers and Morrison & Foerster.
• September 2014: Sources confirm to Legal Week that Morgan Lewis and Bingham are in merger talks, and that Bingham's London office is considering a split from the firm. Browne confirms to the partnership that the management of both firms have agreed to a tie-up, while various websites for a merged Morgan Lewis Bingham firm are registered.
• October 2014: More than 50 Bingham lawyers in London, Hong Kong and the entire Frankfurt office complete their exit to Akin Gump Strauss Hauer & Feld. The City office is reduced to just one partner after Elisabeth Baltay joins King & Spalding.
• November 2014: Bingham cancels a planned partner retreat to Arizona in the first week of November – the same week that derivatives co-head Josh Sterling makes an early move to Morgan Lewis. Bingham votes through the Morgan Lewis deal the following week, with Morgan Lewis agreeing to take on 227 partners last Friday (14 November).