Money
talks.
And
apparently,
when
Kirkland
&
Ellis
is
doing
the
talking,
even
the
fortress
of
Wachtell,
Lipton,
Rosen
&
Katz
can’t
hold.
The
Financial
Times
is
reporting
that
Kirkland
&
Ellis
has
landed
themselves
quite
the
lateral
bounty:
Joshua
Feltman,
the
Chair
of
Wachtell’s
Restructuring
and
Finance
Department,
dangling
a
guaranteed
pay
package
of
$80
million
over
three
years
to
lure
him
away
from
his
longtime
home.
Let
that
number
sink
in
for
a
moment.
Eighty.
Million.
Dollars.
Guaranteed.
Feltman
joined
Wachtell
as
an
associate
back
in
2002,
made
partner
in
2010,
and
rose
to
chair
the
firm’s
elite
Restructuring
and
Finance
group.
Over
that
time,
he
helped
lead
some
of
the
most
consequential
restructurings
of
the
last
two
decades,
including
Toys
“R”
Us,
AMC,
Expedia,
and
Express.
He’s
not
just
a
rainmaker;
he’s
the
kind
of
lawyer
whose
name
is
synonymous
with
an
entire
practice
area.
He’s
a
recognized
leader
in
the
burgeoning
field
of
“liability
management,”
having
advised
on
some
of
the
largest
and
most
novel
transactions
in
the
area,
from
Envision
Healthcare
to
AMC
Theatres.
So
why
would
someone
at
that
perch
leave?
Well,
let
me
count
the
reasons…
and
they
basically
all
come
in
the
shape
of
dollar
signs.
The
timing
of
this
hire
is
no
coincidence.
David
Nemecek,
who
rose
to
legal
industry
prominence
advising
distressed
companies
on
using
liability
management
exercises
to
avoid
restructuring
and
bankruptcy,
left
Kirkland
&
Ellis
in
February
to
join
Simpson
Thacher
(along
with
fellow
partners
Christine
Bae
and
Jacob
Ruby).
Nemecek
is
considered
the
architect
of
modern
liability
management
exercises,
creative
out-of-court
restructurings
that
have
become
an
important
revenue
stream
for
elite
firms
and
redefined
how
private
equity
sponsors
manage
stressed
portfolio
companies.
The
move
positions
Simpson
Thacher
to
directly
challenge
Kirkland’s
long-held
dominance
in
that
space.
Bloomberg
Law
reports
that
at
least
nine
partners
with
leadership
roles
in
restructuring
or
liability
management
have
moved
law
firms
since
late
2024,
shuffling
practices
at
firms
including
Fried
Frank,
Willkie
Farr
&
Gallagher,
Latham
&
Watkins,
Simpson
Thacher,
Ropes
&
Gray,
and
Debevoise.
It’s
being
describes
as
a
“super
cycle”
of
lateral
moves
across
restructuring
practices.
With
an
economy
teetering
on
the
edge
(tariff
chaos,
market
volatility,
corporate
debt
maturities
piling
up),
a
top-flight
restructuring
practice
its
essential
countercyclical
planning.
Feltman
noted
earlier
this
year
that
an
uptick
in
Chapter
11
activity
seems
inevitable,
both
to
address
unsuccessful
liability
management
transactions
and
in
the
face
of
upcoming
maturities
for
substantial
debts
incurred
between
late
2020
and
2022.
So,
the
work
is
coming,
but
who
is
going
to
get
to
bill
for
it
remains
unanswered.
Kirkland,
stung
by
the
Nemecek
defection,
clearly
decided
it
needed
to
swing
big
for
a
replacement.
When
a
firm
that
already
pays
its
average
equity
partner
$11
million
offers
an
individual
attorney
a
guaranteed
$80
million
over
three
years
—
roughly
$26.7
million
annually
—
it
says
everything
about
how
valuable
top
restructuring
talent
is
right
now
and
how
much
Kirkland
wanted
to
plug
the
gap
left
by
Nemecek’s
departure.
Wachtell
is
undeniably
a
remarkable
institution,
and
has
long
been
regarded
as
the
crown
jewel
of
Biglaw
profitability.
It
operates
with
fewer
than
90
equity
partners,
zero
offices
outside
Manhattan,
the
highest
profit
margin
in
the
Am
Law
100,
and
revenue
per
lawyer
reported
at
over
$5
million,
the
highest
in
the
industry.
But
as
we
keep
seeing,
there
is
something
that
even
the
most
elite
partnership
culture
cannot
fully
inoculate
against:
enough
guaranteed
money,
deployed
by
a
firm
with
$10.56
billion
in
annual
revenue
that
genuinely
has
room
to
spend
it.
Kathryn
Rubino
is
a
Senior
Editor
at
Above
the
Law,
host
of
The
Jabot
podcast,
and
co-host
of
Thinking
Like
A
Lawyer.
AtL
tipsters
are
the
best,
so
please
connect
with
her.
Feel
free
to
email
her
with
any
tips,
questions,
or
comments
and
follow
her
on
Twitter
@Kathryn1 or
Mastodon
@[email protected].