Thacher Proffitt & Wood LLP, which was hired by the Treasury Department less than three weeks ago to work on the government's $700 billion bailout program, has announced that it will dissolve after the first of the year.
The venerable
Thacher Proffitt said 40 partners from its structured finance, real estate and corporate and financial institutions practice will join Sonnenschein. The three main partners on the Treasury Department contract are among them.
Thacher Proffitt was hired by the Treasury Department on Dec. 10 to provide legal advice on the purchase of asset-backed securities. The agency said the deal would run for six months and that the cost was not expected to exceed $500,000.
It is unclear whether Sonnenschein will seek to assume the Treasury Department contract. Although the firm took on many of Thacher Proffitt's lawyers, it did not acquire the firm, which had been one of the leaders in the field of asset- and mortgage-backed securities. Thacher Proffitt's fortunes skidded in the past few years along with the market for those securities.
The contract with Thacher Proffitt that the Treasury Department posted on its web site concealed the hourly rate the government was paying for legal services and omitted other information about the financial terms.
The portion of the contract that the Treasury Department made public did specify that the government would pay for a maximum of 1,300 hours of legal work.
At the time that Thacher Proffitt won the Treasury Department contract, it was in merger talks with another big firm, King & Spalding LLP, of
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