What’s Going on at Powerhouse Law Firm Weil, Gotshal & Manges?

The white shoes at one of Wall Street’s top law firms could really use a shine.

Weil, Gotshal & Manges has been rocked by a series of increasingly dramatic departures. Merger talks reportedly fell through, and now the lawyer slated to be its next leader is apparently having second thoughts. Here’s where all the action stands.

Legal Brain Drain

With more than 1,200 lawyers and over a dozen offices across the US, Europe and Asia, Weil is one of the world’s elite law offices. Its leading bankruptcy and restructuring franchise, considered an industry gold standard, guarantees a bedrock of high-margin earnings (which get turbocharged in times of economic stress). Weil said earlier this year that it’s on track for record annual revenue and profit, and it’s one of the world’s most profitable firms on a per lawyer basis. But its roughly $2.1 billion in annual revenue was flat last year, while the 100 largest US firms collectively grew revenue by 13%, according to The American Lawyer.

Since the start of this year, the firm has hemorrhaged enough talent to fill a charter yacht or two, with some 30 partners defecting to rivals. Michael Aiello, the head of its M&A practice and rainmaker extraordinaire, announced plans to leave last month for Cravath and take five lawyers with him. Last week, The Wall Street Journalsaid at least four more partners were on the way out, among them management committee members. Then, over the weekend, the Financial Timesreported that Ramona Nee, the private equity expert who was slated to become the firm’s next executive partner in January, backed out of the job. A report in Semafor added that Nee has held tête-à-têtes with Wall Street rival Simpson Thacher & Bartlett about joining them. Oof.

The driving force behind the exodus is simple: The market for top lawyers is highly competitive and rivals have proven willing to dole out massive compensation, with some top Wall Street lawyers making $20 million per year. Matching all the offers of those leaving would likely risk taking money away from other partners. Poaching sprees have typically hit smaller elite firms, which makes Weil’s size and prestige especially notable. It also highlights a wave of white-shoe consolidation. Rumors have swirled since late September that Weil is looking to merge with a competitor. The firm denied them at first, but more recent evidence points to the contrary:

• Last week, just days after it leaked that Weil was in merger talks with Willkie Farr & Gallagher, negotiations were called off. Ace sleuthing by Law360, which discovered that someone registered a URL combining the firms’ names, suggests things may have gotten close.
• Partner defections have served as catalysts for other, typically smaller firms to merge. Take for example Shearman & Sterling, which combined with Allen & Overy in 2024, or Cadwalader, Wickersham & Taft, which earlier this year completed what was billed as “the largest law-firm merger in history” when it became one with Hogan Lovells.

Vindication: “My old law firm is falling apart,” tweeted Gabriel Shapiro, a former Weil associate and now CEO of legal tech startup MetaLeX Labs. “Guess I should be glad I stopped chasing the brass ring.”