London Legal Scene Shaken By Firm Closure
US law firms have made big waves in the London law scene particularly with their stellar pay packets and wage wars, but they are also feeling the heat of the competitive London legal scene with a major firm closing shop in the City.
The biggest American players in the City are continuing to raise salaries for one of America’s oldest law firms is closing its London law operation just three years after a high-profile launch.
Armstrong Teasdale — one of the 200 highest-earning American firms — is understood to have told staff that it will “imminently” close its City office and has suffered reverses with its US business such as the New York office departures recently.
The firm, which was founded in St Louis in 1901, launched in the City in 2021 by taking over a smaller practice, Kerman & Co, that specialised in a range of business law services. At the time, the firm said that the takeover gave it a 50-lawyer strong presence in London.
The move was the climax of rapid expansion outside of the firm’s Missouri base, as it added eight international offices in slightly more than two years.
The demise of Armstrong Teasdale will come as a sharp illustration to US lawyers that there is no guaranteed success in opening a London office, where they have also suffered declining profits — especially for firms outside the main US legal centres of New York, Chicago, Texas and California.
While demand for litigation work rose in early 2024, demand for corporate practices has fallen by almost 4 percent for mergers and acquisitions matters in the first quarter, according to Thomson Reuters Institute’s Law Firm Financial Index.
English and US firms in the City will be struggling with increasing staff overheads as the biggest American players continue to raise salaries for junior lawyers.
American firms currently dominate the league table for junior salary pay, with Gibson Dunn & Crutcher and Paul Weiss in joint top position, offering newly qualified solicitors starting salaries of £180,000. The US law firms’ aggressive partner poaching has lead to significant changes to the way they compensate partners.
But, as the example of Armstrong Teasdale demonstrates, not all US law firms entering the London legal market are going to make easy meat of ‘the Brits’.
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