Canadian Lawyer

w w w . C A N A D I A N L a w y e r m a g . c o m M a r c h 2 0 1 4 7 REPORTED HEENAN BLAKIE LAWYER MOVES feBruary 4-20, 2014 RegioNAl wRAp-up 13 13 16 29 21 30 10 11 3 3 3 LaVErY DE BILLY BaKEr & McKENZIE BOrDEN LaDNEr GErVaIS DENTONS GaLL LEGGE GraNT & MUNrOE (NEW FIrM) BcF POWEr LaW (NEW FIrM) GOWLINGS 1 1 1 hIcKS MOrLEY ShEEN arNOLD McNEIL (NEW FIrM) MccarThY TÉTraULT aITKEN KLEE 1 1 2 2 1 1 1 4 aIrD & BErLIS DE GraNDPrÉ chaIT MILLEr ThOMSON GrOIa & cO. rOPEr GrEYELL MaThEWS DINSDaLE cLarK nAtiOnAl GONE SOLO hEENaN BLaKIE LEFT LaW PracTIcE 9 9 OSLEr MEP BUSINESS cOUNSEL (NEW FIrM) 10 LaNGLOIS KrONSTrÖM DESJarDINS Total 475 * 20 FaSKENS A fter months, maybe even years of spec- ulation, one of Canada's most storied law firms, heenan Blaikie LLP, issued a short press release late on the evening of feb. 5 say- ing the partners of the firm had voted for an "orderly wind-up" of its operations. the staid official notice of what was essentially the largest failure of a law firm in Canadian history belied the fireworks and ripples the event sent through the legal profession. As of press time, less than half of the firm's lawyers had found new homes. A few firms took fairly large groups including Quebec regional shop BCf, which added 30 former heenan lawyers, and Dentons, which absorbed at least 29 into various offices across the country and was reportedly talk- ing to at least 15 more. A few new firms arose from the ashes including Gall Legge Grant & Munroe in Vancouver that will be the landing pad for 21 lawyers and some of heenan's biggest names including firm founder roy heenan, former supreme Court of Can- ada justice Michel Bastarache, former B.C. attorney general Geoff Plant, and former Maple Leafs general manager Brian Burke. A deal for between 55 and 70 lawyers with global firm DLA Piper fell through. It was tough on everyone but partners seemed to fare the best. the lives of many young lawyers and support staff, in particular, were thrown into total disarray with some saying they received only a week or two of notice before they had to clear out with scant details on severance. other firms are reaching out but there is only so many they can absorb. that is one of the lessons of heenan's collapse. "Quite frankly I think the firms are going to struggle," says John rider, chief innovator with Cognition LLP and former chief client officer at fraser Milner Casgrain LLP. "the issue is that no firm is full of rainmakers. there is a limited number of people with a strong enough client base to bring over to these other firms." the problem, says rider, is there has been no fundamental change in the way these law firms are delivering legal services. "You don't change these large firms overnight. You can have 25 national law firms of 500 lawyers each or you can have 12 national law firms of 1,000 lawyers each — it doesn't change the underlying issue that the way big law is delivering big services is not what the market is looking for and won't be looking for going forward." while heenan Blaikie had good years immediately after the 2008-09 downturn, they were perhaps the "worst thing that could have happened to them," said one source. But even after a good year, it doesn't take much for things to go south, says Colin Cameron, of Profits for Partners Management Consulting Inc. A 10-per-cent drop in revenue can potentially result in a 25-per-cent loss in profits assuming a 40-per- cent net-profit margin. "to further demonstrate that example, if your revenue is off 20 per cent, your net profit is cut by 50 per cent," he says. "so it could be as simple as that." In addition, others say there was a perfect storm happening on many levels at heenan Blaikie. for example, the firm opened a Paris office just as the european economy was tanking. And when revenues drop, problems can develop quickly given firms' fixed costs, says Cameron. — GAIL J. CoheN gail.cohen@thomsonreuters.com the spliNteriNg of heeNaN Blaikie * aS OF FEB. 6, 2014 (IN FEBrUarY 2013 FIrM haD 540 LaWYErS) POSSIBLY UP TO 15 MOrE

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