Texas Firms Getting PPP Loans Range From Am Law 200 Firm to Solos
Texas firms, some of which are having record-breaking years, used the federal loans to avoid employee layoffs or pay cuts.
July 28, 2020 at 02:03 PM
5 minute read
The 1,159 Texas firms and legal aid organizations that were awarded federal Payroll Protection Program loans of at least $150,000 during the pandemic ranged from Am Law 200 firm Thompson & Knight to a number of solo practitioners.
The Small Business Administration made data about the loan recipients public earlier this month, with at least 45 Am Law 200 firms awarded loans under that federal program aimed at helping businesses keep their employees working during the COVID-19-related economic downturn and stay-home orders.
In addition to Thompson & Knight, four Texas firms and two legal aid organizations received between $5 million and $10 million in PPP money, according to the data. They include plaintiffs firm Thomas J. Henry Law of San Antonio; Dallas firms Thompson, Coe, Cousins & Irons and McKool Smith; and Chamberlain, Hrdlicka, White, Williams & Aughtry of Houston. Also, Texas RioGrande Legal Aid in Mercedes and Lone Star Legal Aid in Houston each also received between $5 million and $10 million.
A number of other midsize Texas firms included in the Texas Lawyer Annual Report on Firm Finance received PPP loans ranging from $2 million to $5 million, including Porter Hedges; Munsch Hardt Kopf & Harr; Gray Reed & McGraw; Kane Russell Coleman Logan; and Patterson + Sheridan. (IP firm Patterson + Sheridan was listed with the address of its New Jersey office.)
Mark Sloan, the managing partner of Thompson & Knight, the largest Texas firm to receive money, was not immediately available for comment.
But, the firm provided this statement: " With COVID-19 deeply affecting many of the industries we serve, including the energy sector, we accessed appropriate resources available under the CARES Act to reduce the impact to the firm. Our 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."
Larry Campagna, managing shareholder of Chamberlain Hrdlicka, which has offices in Houston, San Antonio, Atlanta and Philadelphia, said the firm's PPP loan enabled it to avoid any pay cuts, furloughs or layoffs of employees.
" We were grateful we did receive the PPP loan. That allowed us to keep 100% of our employees on staff, fully paid with all benefits," he said.
The loan money "relieved" the firm of the need to consider steps that other firms had to take. The money has largely been spent, but Campagna said the firm has been doing well despite the pandemic. He said some practices have been stronger than others, such as bankruptcy, and tax controversy work out of the Atlanta office.
"Overall we are ahead of last year, and last year was a record year," he said. The firm posted revenue of $91.9 million in 2019.
Chamberlain Hrdlicka has been able to accomplish that, he said, in part because of the PPP loan, which provided cash flow at a time when the economy was struggling. In March, when the firm applied for money under the government program as the economy was shutting down, "nobody knew what was coming," he said.
Uncertainty in the economy still exists, Campagna said, even as some booming practices have been boosting firm revenues this year.
"If we don't have a vaccine as we head into 2021, nobody knows what's going to happen," he said.
Houston labor and employment lawyer Alfonso Kennard Jr, sued his bank in April, alleging it failed to process or properly submit his firm's PPP application and prioritized "select customers and 'bigger businesses."
But Kennard Law did ultimately get a loan in the range of $350,000 to $150,000, and in June Kennard filed a motion asking for a nonsuit, which a judge in Harris County granted.
He has filed litigation making similar allegations against four other banks on behalf of clients, and those suits, which seek class-action status, are pending in federal courts in Texas and California.
Kennard said his firm's PPP loan allowed Kennard Law to avoid pay cuts, layoffs and employee furloughs.
Even though the money has run out, and his firm's revenue is down at the moment because fewer people are suing for wrongful termination, he plans to maintain "status quo" at his firm, which employs 16.
"I've never missed a payroll," he said.
|Read More:
Big Law Firms Got Millions of Dollars to Preserve Payroll. Some Made Cuts Anyway
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