The partners at Wolf, Block, Schorr & Solis-Cohen L.L.P. decided to dissolve the law firm on Monday. The firm, which had played a major role in Philadelphia’s legal scene for the past 106 years, was forced to fold under the pressure of the credit crisis and an exodus of its partners to other city firms.
As is the case with most of corporate America these days, Wolf Block experienced a severe lack of revenue as housing and commercial real estate markets came crashing down. The news could not have gotten much worse for a firm that relied on real estate work for as much as 50 percent of its revenue during a good year. The lack of diversity was a major contributor to the fate of the firm.
The decline in revenue led to a less than favorable deal between Wolf Block and its lender, Wells Fargo. Wolf Block, like most law firms, used its credit heavily in the beginning of each year and paid it back as fees were collected from clients. When word of Wolf Block’s misfortunes began to circulate around the legal community, many firms in the city began attempts to lure Wolf Block attorneys away. This caused Wolf Block to produce less and make it tougher on the bank to offer them credit. The flight of lawyers coupled with the economic turmoil was too much for the firm, once known as the city’s premiere Jewish law firm.
The size of the firm also acted as a detriment to success because Wolf Block was too small to be diverse, but with about 300 lawyers was too large to forge its own spot in the legal community. Unfortunately in todays economy, many mid-sized firms are in danger of facing the same fate as Wolf Block. George Burrell, a former political advisor to former Mayor John Street (and also a former Wolf Block employee from the 1970s), believes that smaller niche firms will be able to survive the current economic situation. He goes on to say that firms with too many lawyers to be a small firm but not big enough to be a mega-firm will travel a similar path to Wolf Block. In the end Wolf Block’s inability to adapt to a changing economic and legal environment can be blamed for its extinction.
Technorati Tags:
Wolf Block
Similar Posts:
- None Found
{ 0 comments… add one now }