Lookzy: all your daily legal news in 0.1 billable hours. Litigation, deals, lateral moves and industry news; we cover it all. 

Welcome to Lookzy.  In today's Lookzy:

• Citi Private Bank releases their annual advisory on the state of the legal industry

• Juul settles thousands of cases

• Partners Group goes shopping for watches

• The SEC is preparing for a major rules change

STATE OF THE LEGAL INDUSTRY

Citi Private Bank's Law Firm Group and Hildebrandt Consulting released their annual client advisory which analyzes the state of the legal industry and makes some predictions about its future.  We've broken down the highlights for you.  

Revenue & Profitability

The legal industry realized "modest" revenue growth in 2022 at a 4.1% average, compared to 14.7% growth over the same period of 2021.  Compared to the strong results experienced in 2021, Citi's expectation is that most firms will see a decline in profitability in 2022.  Given inflationary pressure, firms are also experiencing much greater costs, so they will likely be on the lookout for efficiencies.  

Demand & Leverage

Client demand at U.S. law firms dropped 1.2% overall through the first nine months of 2022, compared to the same period in 2021.  Firms are likely dealing with excess capacity, as we've seen in with layoffs at Cooley and others and general reports of associates often struggling to meet hours minimums.  

Citi expects that excess capacity will quickly correct itself when the market recovers and that firms will restart fights for laterals.  This rings true to us, but the open question is when the market actually rebounds.  

Practice Areas

As you might expect, Citi anticipates that those firms with a heavier focus on down cycle practices (e.g., restructuring) will do better than those who are heavily dependent on M&A and capital markets practices.  While this rings true, we'd emphasize that volatility is likely the bigger factor over the overall level of the market.  

Read the full report for yourself here.  

ECON SNAPSHOT

The difference between special bonuses and layoffs.

THE VERDICT

Arguing today's litigation news

Vaping is expensive.  Juul Labs agreed to settle approximately 5,000 cases related to claims about the addictiveness of e-cigarettes.  Juul noted that it secured an equity investment to help fund settlement of those cases, financial terms of which were not discussed.

"Questionable" discovery.  A NY judge ruled that Arnold & Porter will not be held in contempt, but it may be punished with monetary sanctions or attorney fees for its "poor judgement" and "questionable practices" during opioid litigation discovery.  

Misstatements IRL.  The SEC is reportedly investigating whether IRL, the messaging app, misled investors.  IRL previously raised $170 million from SoftBank's Vision Fund 2 at a $1.17 billion valuation in June 2021.

Absolute priority.  The bankruptcy judge for Celsius, the crypto company, ordered the return of some crypto assets to customers, holding that such assets belong to users rather than treating users who lost funds in the defunct company as general unsecured creditors.  

Securities abroad.  Data shows that investors are increasingly filing securities litigation suits in foreign jurisdictions like the Netherlands and Australia in recent years, and obtaining larger settlements.  

Elizabeth & Sunny.  Ex-Theranos president 'Sunny' Balwani was sentenced to nearly 13 years for fraud, a slightly longer sentence than founder Elizabeth Holmes.  

THE DEAL

Wheelin' and dealin' today's corporate news

Holiday bonus.  The Swiss-based commodities trading company Trafigura is distributing $1.7 billion to shareholders and top traders as a result of huge profits in energy trading. 

Watch M&A.  Partners Group Holding AG, currently a minority shareholder in Breitling, agreed to increase their stake to become the majority shareholder buy purchasing a portion of shares from CVC Capital Partners.  The deal values Breitling at $4.5 billion.  

Ready for a shopping spree.  Thoma Bravo announced that it closed three funds with a total of $32.4 billion in capital commitments, including a $24.3 billion flagship fund that the firm says is the largest technology buyout fund in history.  Kirkland is repping Thoma Bravo.  

Insurance sell-off.  Italian insurer Generali SpA is planning to sell approximately $21 billion of its life insurance portfolio as part of a plan to improve profitability, with the sale process intended to kick off in January.

Equity markets rules change.  The SEC is preparing to introduce major changes next week to equity market rules, which will impact how stocks are bought and sold.  The will represent the first major change to equity market rules in almost 20 years.  

BUSINESS OF THE FIRM

Lateral Moves: 

• WilmerHale hired white-collar partner Richard Burger from DWF.

• Dechert LLP promoted 17 attorneys to partner.

• The U.S. District Court for the District of Delaware announced that AUSA Laura D. Hatcher, who previously worked at DLA Piper and Richards Layton & Finger PA, will succeed Magistrate Judge Mary Pat Thynge when she retires in 2023.

Industry News:

• With the Democrats' win in Georgia providing them with 51 seats in the Senate, expect more Democratic judicial nominations to go through since only a simple majority of the Senate is needed.

• New York's Office of Court Administration announced that the New York court system will launch a portal for members of the public to request access to virtual state supreme court civil proceedings.

• The international legal and arbitration industry in the UK generated approximately $50 billion between 2021 and 2022.

BOILERPLATE

*Googling* how to anonymously report several BigLaw offices...

Alright, back to billing.  That's all, folks!