After riding the technology wave to become one of the Bay Area's most prominent and profitable law practices, the San Francisco firm of Brobeck, Phleger & Harrison said Thursday that it will dissolve like the boom times that built it.
"Brobeck will likely wind down its operations according to a process that will be defined in the next few days," spokesman John Pachtner said. "The continued down economy, the troubled technology sector and the departure of many of the firm's partners make it unlikely that Brobeck will be able to continue as a free-standing law firm."
Once home to 870 attorneys, Brobeck in recent months witnessed a dramatic flight of partners. Now down to 500 lawyers, it had hoped to survive by merging with Morgan Lewis & Bockius, a more traditional and financially stable East Coast firm. But talks broke down Wednesday, Pachtner confirmed.
Its officers are meeting with its bankers, including its largest lender, Citigroup Inc.'s Citibank, today to renegotiate the terms of its loans, said to total $90 million.
Like many of its technology clients, who rose and fell during the Internet boom, Brobeck's troubles are rooted in its aggressive expansion during the 1990s. An old-line banking and litigation firm, Brobeck saw Silicon Valley start to take off and jumped in to provide legal help in the 1970s.
Cisco Systems Inc., Sun Microsystems Inc. and Irvine-based Broadcom Corp. were among the firm's clients. Brobeck played a key role in helping to bring Broadcom public in a spectacular initial public offering in 1998. It also played pivotal roles in turning start-ups such as Buy.com, 1-800-Flowers.com and Stamps.com into public companies.
But clients left Brobeck as they sought to pare expenses or went bust. As work dried up, attorneys began leaving.
The firm lost about 60 partners last year. In November it instituted measures to stem the tide by making it financially difficult for partners to resign. Left with significant debt, the firm began shedding employees.