August 5, 2009 1:40 PM
With Jan Baker Aboard, Latham Seeks to Break On Through to the Debtors' Side
Posted by Brian Baxter
When D.J. "Jan" Baker left Skadden, Arps, Slate, Meagher & Flom in May to join Latham & Watkins, many in the legal industry wondered what it would mean for Skadden, which had just lost two M&A lawyers to Kirkland & Ellis.
But Baker's departure was more a sign that Latham, always a stalwart on the creditors' side in corporate bankruptcies, was getting serious about building up its presence on the debtors' side.
"There's been a recurring question mark in the restructuring world as to when Latham would move towards developing a debtors practice in New York," says Baker (pictured right). "The answer is now."
Two months into his new digs in the Lipstick Building in Manhattan, Baker is settling in at a firm he describes as "remarkably similar" to Skadden.
"The client practice and legal issues are the same everywhere," says Baker, who will cochair Latham's insolvency practice with Mitchell Seider in New York and John Houghton in London. "The hard part is figuring out how to operate the coffee machine and place a long-distance phone call."
Although Latham is no stranger to debtor bankruptcy work, moving the firm in that direction could lead to growing pains. The firm has strong debtors practices on the West Coast and in Chicago, but not in New York--something Baker is determined to change.
That means spending time talking to banks, financial advisers and friends at other firms in the tight-knit New York bankruptcy community. It's a task well-suited to the veteran bankruptcy lawyer, who joined Weil, Gotshal & Manges 25 years ago and opened the firm's Houston office. He left for Skadden in 2000 as Skadden was expanding its restructuring practice to challenge Weil's traditional hegemony in the field.
Baker landed at Latham as a result of longstanding connections to members of the firm. He's known Latham partner Robert Rosenberg, the firm's former global insolvency cochair, for 30 years (Rosenberg was lead counsel to the creditors' committee in the Delphi bankruptcy case) and worked with Latham banking practice cochair Marc Hanrahan at Skadden. He's also known Latham bankruptcy cochair Mitch Seider since Seider was an associate at now-defunct Houston bankruptcy boutique Sheinfeld, Maley & Kay 20 years ago.
The recruitment was subtle at first, Baker says, beginning with a bunch of old bankruptcy buddies asking his advice on how to build a debtor practice. It wasn't long before Baker realized he was the carpenter they had in mind.
"We found Jan's consensus-oriented approach very consistent with our own," says David Heller, global chair of Latham's finance department. "A lot of our clients in the capital markets had nothing but positive things to say about him."
Even before Baker's arrival, Latham had its fair share of work on the debtors' side, including cases in Delaware and New York.
In recent months, the firm has handled Chapter 11 cases for health club chain Bally Total Fitness, flash memory maker Spansion, and outdoor retailer Eddie Bauer. The debtors' assignments, which tend to be more lucrative than their creditor counterparts, have paid off. (Court records show Latham has billed Spansion $4.2 million since the company filed for bankruptcy in March. Eddie Bauer, which was sold to a private equity buyer last month after 46 days in bankruptcy, has paid the firm $2.6 million.)
Baker will also continue to work with former Skadden colleagues on the bankruptcy case of Spectrum Brands, an Atlanta-based company that makes Rayovac batteries and Remington razors. Spectrum, a longtime Skadden client, filed for Chapter 11 earlier this year and has a reorganization plan stayed pending an appeal. Not wanting to leave the company in the lurch, Baker, who was leading the Skadden team, agreed to stay on.
Baker is confident his new firm can work both sides of the bankruptcy equation but knows it may take some time to catch up.
"Ten years ago there was Weil Gotshal and everybody else was a step behind," he says. "Over the last ten years, Kirkland and Skadden have done a fabulous job in making it really a three-horse race. And it was exciting for me to be at Skadden to help make it happen."
So is Baker the jockey Latham needs to make it a four-horse race?
Baker would love to think so, but knows the transition may take ten years. Of course, a decade from now, Baker's not sure what he'll be doing, although he anticipates he'll still be practicing law.
"It's like a litigation friend of mine once told me: all lawyers, whether they're litigators or deal lawyers, are born with a certain amount of trials or deals they're prepared to do," Baker says. "You never know how many that it is until you get to the point where you say, 'I'm done.' Presumably, one of these days I'll wake up and realize I want to go do something else."
Just not yet. Latham has work to do.Make a comment