Established Irvine Law Firms Dissolve : Professions: Two practices specializing in different fields split up as partners disagree over direction.
IRVINE — Two Irvine law firms that had earned well-regarded reputations for their expertise in separate fields have dissolved, splintered by partners with divergent views on the direction of their practices.
Bankruptcy specialist Lobel, Winthrop & Broker, which had 13 lawyers, started to disintegrate last fall when partner Jeffrey W. Broker left, and the end came recently when partner Marc J. Winthrop formed his own firm.
This week, the 20-lawyer business litigation firm of Callahan & Gauntlett fell apart when co-founder David Gauntlett and two other lawyers left to form their own practice.
Such law firm breakups have become more common in recent years as the legal profession continues to struggle with recessionary pressures, forcing them to rethink old forms of conducting business and to try to find ways to reduce fees.
“Clients now say they hire lawyers, not law firms,” said Tom Clay, a consultant specializing in law firm management at Altman, Weil & Pensa in Newtown Square, Pa. Clients also want value, he said, and business-savvy lawyers are looking at their costs.
“They look at the economics and figure out that the overhead will be a fraction of what it was with a larger firm, and that is what their clients want,” said Clay. “People do not want to pay such high prices for legal service anymore.” That is partly what Winthrop hopes to capitalize on in creating a new, smaller firm.
Both Winthrop and former partner William N. Lobel said the final breakup came when the partners no longer could agree on the direction to take the firm. Winthrop said he wanted to begin representing small and medium-sized companies that need legal advice on handling their debts.
“There are middle market companies who would benefit from Chapter 11 but can’t afford it,” said Winthrop, who as part of Lobel Winthrop helped reorganize companies such as Rusty Pelican Restaurants and Pacesetter Homes. To give smaller companies access to his services, Winthrop is cutting his billing rate by $45 to $350 an hour.
Winthrop is also advising four area school districts that stand to lose money they had invested in the beleaguered Orange County bond portfolio.
Lobel will continue to represent corporate debtors in bankruptcy matters. “I have not changed a thing,” he said. “The only difference is the name.” The new name, Lobel and Opera, includes Robert E. Opera, who became a name partner after Jeffrey Broker departed.
David Gauntlett left his position as partner at Callahan & Gauntlett, known for its work in intellectual property rights, to found Gauntlett & Associates. Gauntlett will continue, along with two former Callahan & Gauntlett attorneys, to specialize in the same field of law.
Callahan formed a partnership with two former associates, Stephen E. Blaine and J. Craig Williams. Callahan, Blaine & Williams, which also includes the remaining 17 lawyers, will continue to work in the field of intellectual property.
Neither Gauntlett nor former partner Daniel Callahan would elaborate on the dissolution of the firm.
More to Read
Inside the business of entertainment
The Wide Shot brings you news, analysis and insights on everything from streaming wars to production — and what it all means for the future.
You may occasionally receive promotional content from the Los Angeles Times.