Weil Gotshal to Wind Down in Shock Fall for Heavyweight Firm

Weil Gotshal & Manges plans to wind down its operations, a staggering collapse for a nearly century-old law firm that was once a New York corporate powerhouse.

The end for the firm whose lawyers advised Microsoft, General Motors and Lehman Brothers follows a raft of prominent partner exits and failed merger talks with New York’s Willkie Farr & Gallagher that triggered a scramble to keep partners on board and find a path forward.

Weil was among the country’s 30 largest firms last year, bringing in nearly $2.1 billion in revenue. The run on the partnership occurred as its longtime leader Barry Wolf was set to relinquish control after a protracted process that raised questions about the firm’s direction.

“Following a careful review of strategic alternatives, the firm’s management committee has recommended to the partnership that the firm pursue an orderly wind-down,” a Weil spokesperson said in a statement. “During the wind-down process over the coming months, the firm will continue serving clients with the dedication and excellence that have defined it.”

Partners are expected to vote on the plan in the coming days, the spokesperson said.

It is not yet clear what Weil’s plans will mean for the hundreds of partners, associates or staff at the firm. Law firm failures lead to losses of jobs for staff and associates and often impose a financial hit on partners who invest capital in their firms. Remaining at a law firm through a wind-down is personally challenging and can carry financial liabilities, part of the reason the most in-demand partners often leave struggling firms first.

Outside Weil’s New York offices, near the southeast corner of Central Park, the mood was somber. One first-year associate, who started at the firm last week, said Wolf and the board were together on Zoom, with its longtime leader doing all the talking and offering no opportunity for employees who joined from their desks to ask questions.

The associate, who like others interviewed asked not to be named out of concern for professional repercussions, left shortly after the meeting ended to start calling mentors in the hopes of securing a role elsewhere.

The associates and staff were told they will receive salary and benefits for 90 days, according to a person briefed on what lawyers were told Wednesday. Those employees will be eligible for bonuses if they remain at the firm until when those would normally be paid near year-end, the person said.

Once known as the world’s elite restructuring law firm, Weil gradually fell behind its peers in profitability and came under increasing pressure as Big Law became defined by ruthless competition for the most sought-after partners, who can command north of $25 million per year.

Weil struggled to compete for those types of lawyers and never found its footing in the new, fast-paced environment of partner hiring. Wolf clung to his view that the firm’s culture, which prized loyalty, was a differentiating factor. He often pointed to the firm’s ability to rehire partners who left as evidence the firm had built something special.

“I view it as a family,” Wolf said in a recent podcast.

John Morley, a Yale Law professor who has studied law firm collapses, said there are legal reasons to quickly decide to wind down the firm even as it seems financially healthy. One is that partner pay can be clawed back in a bankruptcy process. An adviser to Weil told Bloomberg Law the firm believes it can achieve a solvent wind-down.

“Once the end of the firm becomes inevitable, you want to start the wind-down as quickly as possible, because you want to minimize the amount of liability the partners are facing,” Morley said. “There’s a degree of sophistication about law firm collapses now that paradoxically makes collapses more probable.”

Weil’s outward turmoil began earlier this summer when a group of private equity partners departed for competitors Paul Weiss and Simpson Thacher & Bartlett. More partners followed to each of those firms, and more are expected to join them in the coming diaspora of lawyers.

Michael Aiello, Weil’s powerful and polarizing corporate department leader, in September announced he would leave for Cravath, Swaine & Moore. News spread to a broader group of partners in the last week that Ramona Nee — slated to take over for Wolf as executive partner in January — decided against taking the job, prompting wide speculation that she would leave the firm.

The departures from Weil highlight how firms with greater profits can destabilize competitors even if they are just perceived to be weaker than those rivals, said Kent Zimmermann, a consultant to law firm leaders at the Zeughauser Group.

“This is a sign of the times for law firms,” he said. “Even very successful firms get into trouble if they can’t inspire enough confidence among their partners that the firm has a bright future.”

At least seven management committee members have left the firm or were reported as planning to leave since late 2024, around the time Weil began publicly signaling it would seek a successor for Wolf.

WATCH: Before Weil, there was Dewey & LeBoeuf

The Willkie merger talks were called off after the two sides had signed a non-disclosure agreement to discuss a tie up and some leading Weil partners tried to drum up internal support for the combination. The firm then engaged an outside restructuring partner amid marathon strategy discussions.

At least one Weil practice group leader on Tuesday told associates to look for jobs elsewhere while they remained employed at the firm.

The news came as Weil represents Kroger Co., the country’s top grocery chain, in a trial over the failure of its $24.6 billion merger with Albertsons Cos. in 2024.

Aiello, who had been Kroger’s lead deal counsel during the merger process, testified Wednesday, the eighth day of a 10-day trial in the Delaware Chancery Court. Six of his former colleagues lead Kroger’s defense against Albertsons’ claims that it didn’t do enough to ensure regulatory approval for the merger.

The turmoil hasn’t had any visible impact on the trial, with testimony continuing through Friday and closing arguments expected in early 2027. Neither Aiello nor six Weil litigators, who represent Kroger alongside attorneys from Ross Aronstam & Moritz LLP, addressed what was happening at the firm.

Back outside the firm’s New York office, one member of Weil’s restructuring department, who joined three months ago, noted the irony that a firm that’s been a part of some of the largest bankruptcies in history -- Enron, General Motors, Lehman Brothers -- is now going through its own demise.

— With reporting by Meghan Tribe, Justin Henry, Tatyana Monnay, Jennifer Kay, Josie Reich, Zahra Tayeb, and Nacha Cattan.

(Adds firm meeting detail, analyst comments, and lawyer interviews starting in seventh paragraph. )

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