Indiana’s Combined Law Firm Market Sees Activity Despite Pandemic

Lawyers Josh Levin and Michael Diehl had two choices when deciding whether to open a new law firm: wait out the pandemic or take a leap of faith.

The partners decided to jump – and did not regret it.

Joshua Levin

“Since no one knew, and still doesn’t know, when the end (of the pandemic) will be, we decided to roll the dice to get things done, and it worked,” Levin said.

Levin & Diehl LLP officially opened its Indianapolis law practice in February 2020 after getting the wheels rolling in December 2019 before COVID-19 took over in the United States. The former solo criminal defense attorneys joining forces are just one of the few combinations that have taken place in Hoosier State since the pandemic hit nearly two years ago.

Combinations were expected to return to the legal market in 2021, but reports have revealed that law firm mergers continued their slow growth last year, remaining below historical averages.

Law firms completed 41 mergers in 2021, according to data compiled by legal consultancy Fairfax Associates. The total was up slightly from 40 in 2020, but well below the historic average of 55 mergers per year over the previous decade.

Despite the downturn, Indiana’s legal community has still seen some combinations happen during the pandemic.

Among them, Bingham Greenebaum Doll has partnered with Dentons to launch the Golden Spike project. Taft Stettinius & Hollister brought together Briggs and Morgan, and Faegre Baker Daniels merged with Drinker Biddle & Reath.

Meanwhile, Indianapolis firms Katz Korin Cunningham and Cantrell & Mehringer joined while Clendening Johnson & Bohrer in Bloomington merged with Hehner & Associates in Indianapolis.

Looking ahead, some in the legal community predict that law firm mergers will return to pre-pandemic levels in the coming year.

Impacted market

The combination of Wooden McLaughlin and Dinsmore & Shohl has been described as one of the most significant mergers between two domestic-only law firms during the COVID-19 pandemic. In January 2021, Dinsmore added Wooden’s 47 attorneys and offices in Indianapolis, Evansville and Bloomington.

Rabinowitch

Misha Rabinowitch, managing partner of the firm’s Indianapolis office, said that while there has been some movement among partners or groups of partners in Indiana, there hasn’t been a lot of combinations at most. scale like theirs in the Hoosier State law firm’s M&A market since the pandemic hit.

“Part of it could be timing,” Rabinowitch said. “We started our discussions before the pandemic. But I also attribute that to the fact that we found the right cultural fit.

Indianapolis attorney Brandon Tate of Waldron Tate Bowen Funk Spandau LLC said he hasn’t necessarily seen the impact of the pandemic on the law firm’s M&A market. Indiana.

“I look at the mergers that have happened during the pandemic, and I would be of the opinion that, if anything, the pandemic has potentially facilitated the ability to merge with tech companies are forced to obtain and catch up , that makes it easy to transition things like case management, file storage, and policies and procedures from two companies into one,” Tate said..

Indianapolis attorney Ann Marie Waldron of Waldron Law merged with the real estate firm of Tate Bowen Funk & Spandau in January 2021, resulting in the creation of Waldron Tate Bowen Funk Spandau LLC.

Brandon Tate

The new firm underwent the necessary transition of a merger at the height of the pandemic as changes in the practice of law were still developing, Tate said.

“With the change that’s happened in the middle of the pandemic, I think it’s actually helped guide our office through the new legal landscape, as we’ve been forced to delve heavily into new technologies and options for support that might not have been fully assessed without the merger. “, said Tate.

They were lucky, he added, in that the merger took place in a single building. This prevented the newly merged company from taking a heavy toll from the COVID restrictions on the physical move itself.

About 63% of mergers in 2021 were small, with at least one of the firms having between five and 20 lawyers, Fairfax reported. That’s slightly less than in 2020, when 68% of all mergers involved a firm with five to 20 lawyers.

Mergers have declined by an average of 25% in recent years across the law firm world, said Ron Nye, managing partner of the Major legal advisory group, Lindsey & Africa’s Chicago office.

“In large part, that’s probably because it’s been very logistically difficult for companies to come together and have the required meetings that are involved in merger transactions,” Nye said.

“Legal recruiting remained very strong in 2021, but the stakes are higher when you’re talking about mergers and companies feel they can do business remotely or even entirely remotely,” he continued. “With an individual partner or a small group, it’s more difficult.”

Jason Lopp

Similar to other Indiana suits, Jason Lopp and eight other attorneys left the McNeely Stephenson firm in January 2020 to open New Albany Church firm Langdon Lopp Banet. Treating the new venture like a startup, Lopp said the team in late 2019 accelerated everything needed to launch the new venture.

Then the COVID-19 pandemic hit and, like the rest of the world, Lopp said his team was nervous about what would happen to their business. The biggest concern stemmed from cases halted during the temporary closure of in-person court proceedings.

“A lot of our business has been put on hold, which obviously affects the money coming in,” he said. “But looking back, we feel pretty lucky about the timing because, coming from making decisions around insurance, technology and establishing management roles, we were able to manage the transition quite well.

“It was a bit of a blessing in disguise,” Lopp said. “But it was obviously nerve-wracking there at first.”

Lopp agreed with Tate that investing in technology early in the transition process has given his company the flexibility to work from home compared to more established businesses that have had to scramble to update. Another benefit of fusion during the pandemic, Lopp said, was improved decision-making skills.

“So many changes happened so quickly in the first six months,” he said. “All of that decision-making had to happen pretty quickly, and so now that things have calmed down a bit, we’re able to make decisions more quickly, I think, because we’ve been up against this gauntlet of having to do it. do in March, April and May 2020.”

What awaits us?

As for the future of Indiana’s law firm M&A market, Lopp said attorneys will have to accept that cutting-edge technology and virtual approaches to practicing law are here to stay.

“Firms that don’t make these changes or haven’t already, I think, will continue to struggle and would be willing to lose lawyers to go to these other firms,” ​​he said.

Rabinowitch said he thinks Indiana’s legal landscape will see more movement in the M&A market in the coming year.

“Coming out of the pandemic, I think it takes longer for these transitions to mature. They don’t happen overnight,” he said. “It will take time, but I think we will see some activity.”•

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