Top Litigation Firms Ready For Big Scores In Subprime Sewer

Crain's New York Business reports how top litigation firms have geared up to handle the flood of current and future lawsuits arising from the subprime mortgage problem:

• First came the $211 billion in write-downs of subprime debt, now comes the legal bonanza. In the past four months, nearly 20 law firms have set up subprime practices comprising more than 500 attorneys, many of them in New York. Not since the savings and loan crisis two decades ago have so many law firms moved so fast to create a whole new discipline. "It's a sea change,“ says Marvin Pickholz, the partner in charge of Duane Morris' month-old, 15-lawyer subprime practice group. “These problems are going to expand to such a dimension that it will consume vast amounts of lawyers' time.“

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• So far, much of the work has involved the investment houses that packaged and sold subprime debt. Law firms are being hired to sue or defend such companies as Citigroup, J.P. Morgan Chase, Merrill Lynch and Bear Stearns. The work will by necessity be spread to many firms, as the lawyers who advised banks in the creation of these instruments will face conflicts of interest and most likely be barred from participating.

For more, see Law firms follow money in credit mess (With millions at stake, hundreds assigned to bolster subprime practices).