IFLR 1000
The Guide to the World's Leading Financial Law Firms

	Schulte Roth & Zabel Sidley Austin
	Akin Gump Strauss Hauer & Feld Bingham McCutchen Dechert Katten Muchin Rosenman Morgan Lewis & Bockius Paul Weiss Rifkind Wharton & Garrison Seward & Kissel Skadden Arps Slate Meagher & Flom
	Davis Polk & Wardwell Fried Frank Harris Shriver & Jacobson Goodwin Procter Proskauer Rose Ropes & Gray Weil Gotshal & Manges Willkie Farr & Gallagher

	Debevoise & Plimpton Kirkland & Ellis Simpson Thacher & Bartlett
	Cleary Gottlieb Steen & Hamilton Davis Polk & Wardwell Ropes & Gray Weil Gotshal & Manges
	Akin Gump Strauss Hauer & Feld Gibson Dunn & Crutcher Latham & Watkins Morgan Lewis & Bockius Morrison & Foerster Paul Weiss Rifkind Wharton & Garrison Proskauer Rose Schulte Roth & Zabel

	Dechert Ropes & Gray
	Bingham McCutchen Goodwin Procter K&L Gates Morgan Lewis & Bockius Willkie Farr & Gallagher
	Debevoise & Plimpton Kramer Levin Naftalis & Frankel Paul Hastings Janofsky & Walker Sidley Austin Simpson Thacher & Bartlett Stradley Ronon Stevens & Young Stroock & Stroock & Lavan Sullivan & Cromwell

As regulatory reforms begin to take effect, the landscape of investment funds is undergoing dramatic changes. One attorney notes that hedge fund managers, who were previously subject to relatively lax governance, are "struggling to cope" with the new requirements. "We very definitely have a lot more regulation proposed in just 12 months than I have seen in the past 20 years," says another partner.

Under Dodd-Frank, US hedge funds with assets of over $150 million will have to register with the Securities and Exchange Commission. Registered hedge fund managers will be subject to regular inspections and will have to provide greater disclosures about their business operations. The deadline for registration, which was originally set for July 2011, has now been extended to March 2012. The costs of compliance will barely make a dent in the profits of multi-billion dollar funds, but some lawyers worry that smaller start-ups may no longer be a viable business proposition. "The chances of two guys in their garage starting a hedge fund are very low these days, compared to what they were three years ago," says one attorney. While some see the registration requirement as detrimental to a free market, others believe they may ultimately be good for investors. "We are seeing a better quality of manager," says another lawyer.

With derivatives used by investment funds as a portfolio management tool, regulations which authorise the SEC to demand greater transparency about short-selling and securities lending will also impact funds. Outside of the US, derivatives are often used as a means of gaining exposure to an underlying hedge fund. "The Volcker Rule is going to have a dramatic effect on private funds," says one attorney. "We have got to see if those are viable businesses in the next few years."

Investors are also demanding greater transparency and pushing for reductions in fees. The financial crisis exposed issues relating to operational risk, for hedge funds in particular. Attorneys report that their clients are experiencing an increase in due diligence requests. In addition, the increasing crossover between the pension market and money management has resulted in pressure to drive down fees and reduce unnecessary risks. Although pension plans traditionally stuck with conservative investments, low interest rates and existing commitments to retirees with defined benefit plans have them towards more speculative funds in desperation for yield. "There's a little bit of pressure on pricing in the US, which is causing more arrangements between money management firms and providers of servicing pension-related assets," says one attorney. "The competition is very big. Employers have got leverage and are using it to drive down prices."

With stiff competition domestically, some funds are looking to expand into international markets. "I think quite a few fund families are looking to expand internally and set up operations in Europe or Asia," says one attorney. "We have got a relatively mature, regulated fund industry in the US, and for expansion there are opportunities in Europe and Asia."

Another trend is the increasing launch of exchange-traded funds (ETFs), which are one of the fastest-growing investment products around. Assets in ETFs have now surpassed $1 trillion, and several big firms are moving towards launching their own ETFs. Although ETFs have the advantage of being less expensive for investors than their more actively-managed rivals, it remains to be seen whether they will steal a significant chunk of the mutual fund market. However, some lawyers have suggested that this cheaper competition may generally force fees down. "I think the ETF market is going to continue to expand," says one partner. "This part of the business cycle tends to be the part where there's more acquisition activity and I see some of that in the pipeline already."

Under the leadership of Roger Joseph, Bingham McCutchen has developed a robust practice in both registered funds and hedge funds. The firm's investment management lawyers have experience with nearly every asset class.... [more]

Under the leadership of Roger Joseph, Bingham McCutchen has developed a robust practice in both registered funds and hedge funds. The firm's investment management lawyers have experience with nearly every asset class.

In December 2010, Bingham recruited partner L Kevin Sheridan to its New York office from Goodwin Procter.

Recent highlights include representing WCAS Fraser Sullivan Investment Management as portfolio manager on a multi-tranche CLO transaction worth over $400 million. Other notable work includes advising Pioneer Funds and Pioneer Investments on the potential sale of the US asset management business by parent company, UniCredit.

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Cleary Gottlieb Steen & Hamilton is one of the go-to firms for private equity fund formation. "Cleary has the Texas Pacific Group, which is a fabulous client," says one peer.... [more]

Cleary Gottlieb Steen & Hamilton is one of the go-to firms for private equity fund formation. "Cleary has the Texas Pacific Group, which is a fabulous client," says one peer. The firm has particular strength in representing sponsors of funds focused on equity and debt investments in emerging markets. It has also been involved in the regulatory developments including the SEC's 'pay to play' rules and the European Union's AIFM Directive.

One competitor describes partner Michael Gerstenzang, who regularly represents TPG, as "an absolutely great lawyer". Gerstenzang has also advised JPMorgan, Deutsche Bank, KKR, and Fortress on establishing private investment funds.

A team led by partner Bob Raymond advised Helios Investment Partners on forming its second private equity fund, Helios Investors II. The fund closed in June 2011with commitments of over $900 million, making it the largest pan-Africa investment fund raised to date. It pursues investments throughout Africa, and has already closed a number of landmark transactions.

The firm also counselled on the formation of TPG Partners VI, TPG's latest flagship private equity buyout fund. The fund has commitments of $18 billion and is focused on opportunities in the US and Europe.

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Davis Polk & Wardwell is a well-known name in private equity and a respected presence in hedge funds. The firm has been involved in private equity fund formation matters since they began in the mid-1980s.... [more]

Davis Polk & Wardwell is a well-known name in private equity and a respected presence in hedge funds. The firm has been involved in private equity fund formation matters since they began in the mid-1980s. One competitor says, "They have a handful of big clients and their private equity is very good."

One client, who works with the firm in private equity fund formation, says, "We always feel like we get their best lawyers. They have always made us feel like we were their top priority and when we needed to reach their partners – including the head of the firm – during the nights or weekends, they have always been there."

The firm represented private equity GSC Investment (GNV) as the issuer on the sale of a controlling interest in the company to investors associated with Saratoga Partners. The transaction involved the sale of new equity representing over 35% of the shares of GNV, negotiation of a new investment advisory relationship with Saratoga, and negotiation of a new credit facility with a third-party lender. The transaction was approved by GNV shareholders of GNV and was finalised in summer 2010.

Davis Polk also advised the Securities Industry and Financial Markets Association (SIFMA) on the application of the Volcker Rule to banks and their investments in, and sponsoships of, private equity funds. The firm drafted comment letters for SIFMA in connection with the proposed rules. It is also advising the Asset Manager Group at SIFMA, a group of asset managers whose combined assets exceed $20 trillion, on proposed rulemaking concerning swap transactions.

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Debevoise & Plimpton's fund formation group, which one competitor describes as "second to none", is at the centre of the firm's practice. The firm's world-renowned private equity group represents an impressive range of clients investing in all corners of the globe.... [more]

Debevoise & Plimpton's fund formation group, which one competitor describes as "second to none", is at the centre of the firm's practice. The firm's world-renowned private equity group represents an impressive range of clients investing in all corners of the globe. One rival remarks, "They are absolutely in tier one for formation. They are joined at the hip with Clayton Dubilier & Rice."

Peers are impressed by Michael Harrell, who co-chairs the firm's private equity funds and investment management groups. Another competitor says, "Michael Harrell at Debevoise, we see all the time. He's a leading practitioner."

In a fund which closed in June 2010, the firm represented Oaktree Capital Management in establishing the Oaktree PPIP Private Fund, a $4.6 billion fund making investments in CMBS under the US Treasury's Public-Private Investment Program. The fund was formed to purchase troubled securities central to the US financial system.

Debevoise also advised Stone Point Capital on the formation of Trident V, a $3.5 billion financial services buyout fund. This was one of the ten largest funds to close in 2010.

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Dechert is respected by rivals as a top-notch registered funds practice, and a strong presence in hedge funds. The firm has particular strength in exchange-traded fund formation and is known as an innovator in exchange-traded commodities.... [more]

Dechert is respected by rivals as a top-notch registered funds practice, and a strong presence in hedge funds. The firm has particular strength in exchange-traded fund formation and is known as an innovator in exchange-traded commodities. It pioneered the development of registered fund of hedge funds, organised the first unit investment trusts to invest in equity securities, and organised the first operational funds of funds.

In August 2010 the firm expanded its capacity with the hire of partner Holland West from Shearman & Sterling.

Peers says the firm's funds practices benefit from its relationships with key figures at the SEC. "They are a little bit faster off the mark in terms of anticipating regulatory changes and that additional regulatory focus may help inform their clients of their place in the market," says one rival. "I think they have picked up their share of the market because of the ties they have with senior people in Washington." The firm successfully submitted a petition to the SEC to exempt certain Canadian mutual funds from SEC regulation.

Dechert's lawyers represent some of the largest mutual fund groups in the world. Assets managed by its top clients range from over $100 billion to $1.5 trillion.

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Competitors say the investment fund practice of Gibson Dunn & Crutcher is flourishing under the leadership of co-chairs Ed Sopher and Jennifer Bellah Maguire. “I have very high regard for some of the partners,” says one competitor.... [more]

Competitors say the investment fund practice of Gibson Dunn & Crutcher is flourishing under the leadership of co-chairs Ed Sopher and Jennifer Bellah Maguire. “I have very high regard for some of the partners,” says one competitor. “I have worked with Jennifer. She’s quite seasoned. I like her a lot.” A client says, “They are all very practical and business-orientated, providing more than just legal and technical advice. They come up with novel ways to structure around problems or issues.” In October 2010, the firm recruited partner Chezard Ameer from Ashurst.

The firm represents clients in a wide range of funds, including hedge, private equity, oil and gas, real estate and hybrid. Representative work includes acting as counsel to Credit Suisse in relation to CS Strategic Partners V, a $3 billion secondary fund, and advising sovereign wealth funds in relation to various funds worth up to $10 billion.
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With over two decades of representing the management companies of sponsors, private equity is a key practice area of Kirkland & Ellis. Around 60% of the firm's 600 corporate lawyers regularly work with private equity sponsors.... [more]

With over two decades of representing the management companies of sponsors, private equity is a key practice area of Kirkland & Ellis. Around 60% of the firm's 600 corporate lawyers regularly work with private equity sponsors. Since 1995, it has represented over 280 sponsors in raising over $350 billion of capital for more than 536 funds. One competitor says, "K&E is very established in this space."

The firm regularly represents leading institutional investors in connection with their investments in private funds. At the IFLR Americas Awards 2011, which celebrate innovation, Kirkland & Ellis was named Private Equity Team of the Year.

Peers credit long-time partner Jack Levin, who has handled fund formation matters for big-name clients including Madison Dearborn Partners, First Chicago, and Bank of America, with helping to build the firm's first-rate practice. Levin, together with other Kirkland lawyers, has written two widely-read treatises on private equity. "They probably came to the private equity fund formation earlier than others because of Jack Levin," says one competitor. "They clearly have a significant private equity practice."

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Paul Weiss has a reputation as a strong contender in hedge funds and private equity fund formation. The firm has a reputation for innovation and has developed detailed database which tracks current market trends.... [more]

Paul Weiss has a reputation as a strong contender in hedge funds and private equity fund formation. The firm has a reputation for innovation and has developed detailed database which tracks current market trends. One competitor describes Paul Weiss as a place "funds come to because they have difficult issues and they want quality."

One client highlights the firm's "unparalleled expertise". The client says, "They have seen it all and done it all. They treat us like an important client."

Peers pointed to partner Marco Masotti, the deputy chair of the corporate department, as a leading lawyer in the alternative asset management industry. "He's got some good clients," notes one rival. Masotti and associate Lindsey Wiersma represented Wellspring Capital Management in the final closing of Wellspring Capital Partners V, the largest fund in its 16-year history with $1.2 billion of capital commitments. Work on the project concluded in October 2010.

Other highlights of the firm's work include representing the management team of the Lehman Brothers Real Estate private equity funds in the spin-out from Lehman Brothers Holding and certain subsidiaries. The matter closed in May 2010.

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As a dominant force in the hedge fund space, rivals say that Schulte Roth & Zabel is "unquestionably in tier one" for hedge funds. The firm has over 40 years of experience in investment fund formation, and many of its practice areas benefit from its strength in this area.... [more]

As a dominant force in the hedge fund space, rivals say that Schulte Roth & Zabel is "unquestionably in tier one" for hedge funds. The firm has over 40 years of experience in investment fund formation, and many of its practice areas benefit from its strength in this area. "They are certainly heads and shoulder above everyone else in the hedge fund market and they have grown the funds formation part of that," says one competitor.

A client of the firm says, "I think they are very smart, and very logged into what's happening in the industry." The client singles out "exceptional" partner Stephanie Breslow, co-head of the investment management group and a member of the firm's executive committee, for praise. "She's very smart, very analytical, and understands the hedge fund business," he says. In 2010, the firm added partner Daniel Hunter, who works with hedge funds, hybrid funds and private equity funds, to its New York office. Founding partner Paul Roth, who chairs the firm's investment management group, is described by one peer as "the dean of the bar".

The firm represented the asset management division of Credit Suisse in its acquisition of a significant non-controlling, minority interest in York Capital Management for $425 million in up-front consideration. York is a global hedge fund with approximately $14 billion in assets under management. The transaction, which was the first of its kind to be structured in compliance with Dodd-Frank, closed in November 2010.

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As what one peer describes as "a big player in the hedge fund area and the private equity space", Sidley Austin is one of the strongest contenders across all categories of investment funds. The firm is a powerhouse in hedge funds, and also has a strong practice in registered funds.... [more]

As what one peer describes as "a big player in the hedge fund area and the private equity space", Sidley Austin is one of the strongest contenders across all categories of investment funds. The firm is a powerhouse in hedge funds, and also has a strong practice in registered funds. Its focus in 2010 has been on advising on regulatory initiatives impacting the investment management industry in the United States, Europe and Asia.

Sidley Austin has expanded its team this year with the addition of several partners. In September 2010, Mark Whatley and David Tang joined its hedge fund practice in San Francisco. Alyssa Grikscheit, who advises in emerging markets and cross-border transactions, including fund formation, M&A and joint ventures, joined the firm's New York office as a partner in August 2010. Janelle Ibeling and Daniel Spies were made partners in Chicago in January 2011.

One client appreciates what he describes as the firm's "very accessible, very responsive 24-7 coverage", adding, "We have definitely been a demanding client and they have risen to the challenge every time."

The firm is advising the Garrison Investment Group in connection with the formation of a series of hybrid funds specialising in distressed investments in real estate, corporations and other financial assets. The funds have a total value of $644 million. Other notable work includes representing Roc Capital in its $700 million hedge fund launch, which was one of the first spin-outs of a bank's proprietary trading desk. The spin-out involves Deutsche Bank's quantitative strategies desk.

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With a multi-talented team involved in what rivals describe as a "broad array" of funds, Simpson Thacher & Bartlett is a behemoth in private equity fund formation, and has a strong practice in other types of funds. "They have a fairly broad-based practice dealing with private equity, credit, debt, some hedge funds," says one competitor.... [more]

With a multi-talented team involved in what rivals describe as a "broad array" of funds, Simpson Thacher & Bartlett is a behemoth in private equity fund formation, and has a strong practice in other types of funds. "They have a fairly broad-based practice dealing with private equity, credit, debt, some hedge funds," says one competitor. "Simpson does a lot of private equity fund work and fund formation work."

Clients also appreciate the breadth of the firm's experience. "Because of the range of work they do in the marketplace, they have insights that other firms might not have," says one. "They are an extremely good source of what's best practice in the market." The client identifies partner Michael Wolitzer as "particularly outstanding".

The private equity practice more than doubled its revenue between 2005 and 2010, and remains active despite a 16% decline in the overall private equity fundraising market. The firm recently advised Carlyle Asia Partners III, a $2.55 billion fund formed to make privately-negotiated equity and equity-related investments in Asian companies.

In another highlight, the firm represented Castle Creek Capital Partners IV, which focuses on recapitalisation, growth equity and buyout investments in US-based community banks and was $331 million at its final close.

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Sullivan & Cromwell represents investment funds including real estate funds, hedge funds and private equity funds, and has a particularly good reputation in registered funds. A client of the firm singles out Whitney Chatterjee for praise.... [more]

Sullivan & Cromwell represents investment funds including real estate funds, hedge funds and private equity funds, and has a particularly good reputation in registered funds. A client of the firm singles out Whitney Chatterjee for praise. “She's a young partner and her knowledge of the industry, attention to detail, overall intelligence and care really stand out,” says the customer. “As far as I am concerned, she's top of the line.” Another client remarks of department leader John Baumgardner, “His knowledge of the industry and the law is phenomenal.”

The firm recently counselled Pershing Square and Fairholme Capital Management in their $3.925 billion capital commitment for the stand-alone plan of General Growth Properties and Fairholme’s subsequent sale of its $1.7 billion position in General Growth Properties.

Other notable work includes defending certain trustees of The Vanguard Group in shareholder litigation, which was dismissed with prejudice by the Delaware Chancery Court. The plaintiffs alleged breach of fiduciary duty, negligence and waste, but the court held that some of the plaintiffs’ claims were derivative, and dismissed all claims for failure to make a demand on the board of trustees. Plaintiffs argued that the fact that trustees of the nominal defendant funds were also trustees of The Vanguard Group and every other investment company within the complex, created irreconcilable conflicts. The court rejected the argument.
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Weil Gotshal & Manges is a force to be reckoned with in private equity fund formation. The firm's fund formation group benefits from the expertise of its highly-respected private equity buyouts practice.... [more]

Weil Gotshal & Manges is a force to be reckoned with in private equity fund formation. The firm's fund formation group benefits from the expertise of its highly-respected private equity buyouts practice. "They have a decent number of private equity big names," remarks one competitor. Weil Gotshal regularly advises clients on the regulatory implications of Dodd-Frank and the Wall Street Reform and Consumer Protection Act, including the implications of the Volcker Rule and registration requirements under amendments to the Investment Advisers Act of 1940.

The firm represented long-time client Brookfield Asset Management in the formation of Brookfield Americas Infrastructure Fund, a $2.5 billion fund focused on opportunistic investments in infrastructure assets located primarily in North and South America. The fund closed in September 2010.

Other noteworthy work includes advising another regular client, The Gores Group, on the formation of Gores Capital Partners III. This private equity fund targeted $1.5 billion of commitments and focused on underperforming and undervalued businesses in the US and Europe, primarily in the technology, telecommunications, industrial, business services, media, healthcare and security sectors. It closed in January 2011.

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