| April 22,
April 22, The well-known Los Angeles-based
bankruptcy law firm Stutman Treister & Glatt, which once advised
on the Chapter 11 proceedings of companies including Lehman
Brothers and Enron Corp, has announced it is closing.
"We're in an economy that has had a significant dropoff in
Chapter 11 activity," Stutman shareholder Jeffrey Davidson said
in an interview on Tuesday.
Stutman, founded in 1948, staffs 25 lawyers in Los Angeles
and New York and has represented hedge funds and other
bondholders in bankruptcies including Lehman Brothers
, Delphi Automotive Plc and Residential
Capital, according to firm representatives.
Bankruptcy lawyers say the shuttering of Stutman, scheduled
to take effect on May 1, marks the latest sign that a downturn
in Chapter 11 proceedings has hit the top U.S. bankruptcy law
Chapter 11 filings fell by 36 percent between 2010 and 2013,
from 15,251 filings to 9,811, according to data on the United
States Courts website.
Stutman's Davidson said companies that previously would have
filed for bankruptcy now opt for refinancing because of lower
interest rates offered by banks. That, in turn, hurt business
for bankruptcy lawyers, he said.
The major New York law firm Weil Gotshal & Manges cited a
downturn in bankruptcy work, including business associated with
its role in guiding Lehman Brothers through Chapter 11, when it
laid off 60 junior lawyers and 110 support staff in June 2013.
Davidson declined to elaborate on Stutman's closing, but
referred to a statement in the California legal trade
publication the Daily Journal that said the firm "has determined
that it is in the best interest of our clients, creditors,
shareholders and employees that we cease the practice of law."
Davidson will join the larger bankruptcy law firm Pachulski
Stang Ziehl & Jones, along with Stutman shareholders Isaac
Pachulski and Gabriel Glazer, according to a news release issued
by Pachulski Stang.
The Daily Journal in Los Angeles first reported the news of
(Reporting by Casey Sullivan in New York; editing by Ted Botha
and Matthew Lewis)