Following Schnader Dissolution, Phila. Midsize Firms Fight to Stay Midsize
August 7, 2023
The Legal Intelligencer
Types : In the News
“There are some other firms similar to Schnader that are probably worried they could be looking at the same fate,” said Brian Levinson, managing partner of the legal recruiting firm Alevistar Legal.
- The firm struggled to institutionalize major clients, according to observers in the marketplace.
- Others noted that it became top heavy with more senior partners who were no longer bringing in as much work.
- Philadelphia is finding itself increasingly a target for large national firms.
Philadelphia’s once resilient midsize market is feeling the pressure.
Over the past few years several of Philadelphia’s stalwart firms—including Drinker Biddle & Reath, Pepper Hamilton and Conrad O’Brien—all chose to merge with firms based outside the state, demonstrating for many that midsize firms in the city must grow to survive. Now, with the news that the 88-year-old Schnader Harrison Segal & Lewis is closing its doors, midsize firm leaders once again find themselves evaluating their best paths forward given the high-pressured marketplace the city now finds itself in.
Montgomery McCracken Walker & Rhoads managing partner Steven Pachman said the “megafirm craze,” where midsize firms feel the need to link up with a large firm to survive, appears to be “in full force and effect.” Although, he said the trend does not appear to be isolated to Philadelphia.
“Wherever you are, it’s that megafirm craze. That’s just what it is,” Pachman said. “Firms are feeling that pressure right now.”
Montgomery McCracken regularly fields interest from larger firms seeking to grow their litigation bench and enter the Philadelphia market, and Pachman himself said earlier this summer that he wouldn’t be surprised if the firm “made a move” in the next six to nine months. But in the wake of the Schnader news, he expressed resistance to the notion that a firm must join a megafirm to survive. Instead, he stressed the importance of servicing all the needs of the firm’s institutional clients.
“Our approach has been that we’re not going to succumb to this megafirm craze,” Pachman said. “We believe we have good systems in place to protect against any midsize firm pressure points.”