The future of trainees at King & Wood Mallesons is uncertain today as the firm has failed to find a rescue deal.
The firm is now expecting to be dismantled with groups of lawyers heading to individual firms.
Lawyer 2B understands that all lawyers were briefed by managing partner Tim Bednall this afternoon, with the question of what would happen to trainees discussed at length.
It is understood that the firm is in discussion with the Solicitors Regulation Authority and the Law Society about potential options, and are exploring the possibility that a ‘special dispensation’ might be granted to trainees due to qualify in February which would allow them to qualify without completing their final few weeks at the firm.
It is also examining the possibility of ‘transferring’ training contracts to other law firms.
It is also understood that a number of law firms have already approached KWM to offer their assistance taking trainees.
King & Wood Mallesons declined to comment.
There is little consistency as to how trainees are treated in such a scenario.
When Andersen Legal collapsed in 2002, its managing partner Tony Williams personally rang round his City contacts in order to find jobs for trainees and support staff, ensuring virtually everyone at the firm got a job before he did.
After Cobbetts collapsed in 2013, trainees’ jobs were saved by DWF after it acquired the firm in a pre-pack deal.
Halliwells went under in 2010, leaving 92 existing trainees and future-joiners without a job; however, law firms rallied round to offer positions to those affected, with many ending up at Gateley and Barlow, Lyde & Gilbert (now part of Clyde & Co), with two going to Clifford Chance.
King & Wood Mallesons has been in trouble for some months. At the end of October, partners met to discuss the next steps of the firm’s business strategy after halting a planned capital call, due to inject an additional £14m into the business as part of its recapitalisation plans.
At first, it was thought that the Chinese arm of the business might bail the European and Middle East part out. However, the China bail-out failed in November, leaving a rescue merger as the firm’s only option. That too has now failed and the firm is now expected to be dismantled.