Many Shifting to New Specialties : Antitrust Lawyers Get Less Work as Rules Ease

The easing of antitrust rules, which has cheered so many corporate chieftains, has spread a measure of gloom through the oak-paneled sanctuaries of the nation’s antitrust lawyers.

The antitrust practice of many firms has dropped off sharply since the beginning of the Reagan Administration in 1981, forcing lawyers to scramble for work in other specialties. The general trend to deregulation has reduced the demand for legal brain power in related areas as well.

Hardest hit have been major firms in Washington and New York that had a lion’s share of antitrust trial work generated by such far-reaching actions as the U.S. Justice Department’s mammoth efforts to break up American Telephone & Telegraph and International Business Machines. Several hundred lawyers were kept busy by the IBM suit, dropped in 1981 after 12 years of litigation, and the case against AT&T;, antitrust lawyers note.

Cases Drop Off

The antitrust division of the Justice Department filed five cases opposing mergers last year, down from 10 in 1980, the last year of the Jimmy Carter Administration.

Meanwhile, the number of antitrust cases brought by one company against another--which represent more than 90% of all antitrust litigation--have also dwindled as the courts have evolved a more permissive view of antitrust. The number of new private antitrust cases declined to 1,052 last year, from 1,504 in 1976, according to congressional testimony.

The effects of the sharp drop-off in antitrust work continues to be felt five years after it began.

The Washington firm of Bergson, Borkland, Margolis & Adler is now in the process of dissolution after an unsuccessful struggle to replace its antitrust and trade-regulatory practices.

At its peak, the 35-year-old firm had one of the largest antitrust practices in the country. Bergson, Borkland defended the American Broadcasting Co. in a Justice Department suit alleging that the network was indirectly controlling prices of programs it purchased. It represented Alcoa in government suits alleging that two of the aluminum company’s acquisitions were anti-competitive.

Couldn’t Diversify

But the precipitous decline in government suits “really cut down our trade,” says partner Daniel H. Margolis. “We recognized the situation soon enough but were just unsuccessful in diversifying the practice quickly enough. It’s a very painful thing.”

The firm had 45 lawyers in 1980, pared its ranks to about 25 in a 1982 reorganization, and now has 18, he said.

Declining demand for antitrust work has contributed to problems that led to a mass exodus of lawyers from Washington’s Wald, Harkrader & Ross. The firm boomed in the 1970s, but the decline of the antitrust practice and other federal regulatory work pinched profits and caused some to question management.

“Some of us wondered whether the leadership was paying enough attention to running the place like a business,” said a former firm member, who estimated that in the past two years the firm has lost as much as half of its staff of 120 lawyers.

Partner Robert E. Wald contended that revenues from antitrust work have recently regained their peak level of the early 1980s after falling 25% several years ago. He said the firm has replaced work spawned by government actions with work for private antitrust plaintiffs.

Fees Not Reduced

Other antitrust powerhouses that have felt the pinch are Washington’s Arnold & Porter and Howrey & Simon, and New York’s Donovan, Leisure, Newton & Irvine. “We’ve moved staff into a lot of other areas recently, like environmental work and products liability,” says Sanford M. Litvack, a partner at Donovan, Leisure and a former head of the Justice Department’s antitrust division.

Somehow, though, slackening demand for antitrust expertise has not reduced fees. That is because antitrust matters are still considered critical by corporate brass, and they remain willing to pay top dollar.

“Important issues are at stake, and the clients still want highfalutin lawyers,” says Margolis of Bergson, Borkland.