Cosy Clients: The Relationship between Paul Weiss and Apollo​


By Robyn Ma​

The Story

Private equity firms are lucrative clients for law firms. In fact, Paul Weiss has secured over $100 million in legal work annually from its relationship with private equity firm Apollo Global Management.

Leon Black, CEO of Apollo, has also turned to the firm for advice on investments managed by Elysium Management, his family office. With over $400 billion assets tucked away, Apollo has hiked up Paul Weiss’ earnings and its dealmaking profile. However, according to a series of articles by Insider over the past week, their “cozy relationship” has raised alarm bells.

Over-reliance on one client creates dangers for law firms. In this case, with “tens of millions on the line”, a practice group was created specifically to service Apollo at Paul Weiss, which allegedly drastically altered the firm’s “internal makeup” (Insider). Former Paul Weiss lawyers say this led to situations where the firm had to choose between representing the company or its executive (Insider).


What It Means For Businesses And Law Firms

The lengths of Paul Weiss’ willingness to protect this important client are also evidenced by its treatment of Sujeet Indap and Max Frumes, coauthors of The Caesars Palace Coup - a book investigating a botched $31 billion leveraged buyout (an acquisition financed with borrowed money). Apollo was one of the private-equity firms involved, with Paul Weiss advising. According to Vanity Fair, when the authors reached out to Paul Weiss for an interview, they received a letter accusing them of planning a defamatory attack and requiring all manuscripts and confidential sources sent over. Indap said it felt “unsettling to be threatened” by the firm (Vanity Fair).

Apollo’s first introduction to Paul Weiss came in 2008 when the firm represented the company in a litigation over a failed merger. Bard Karp, the firm’s chairman, later worked with Apollo’s general counsel, John Suydam, to stage a “coup” in an attempt to bring in more work for Paul Weiss. In 2011, he welcomed several partners from O’Melveny & Myers, a firm with close ties to Apollo, and quickly “tilted the power balance within the firm” (Insider). Associates were purportedly taken off other matters and staffed in the ‘Apollo seat’, and those pursuing the partnership track were encouraged to prioritise Apollo-related tasks (Insider).

One former Paul Weiss attorney described this as analogous to “when a parasite takes over its host [...] chang[ing] the whole culture of the corporate department” (Insider).

What does this story mean for you? Well, we know in private equity that client relationships are extremely important, so much so that when one partner jumps ship, this can be extremely lucrative for new firms if they bring over new business. However, law firms must be mindful of the impact that some of the biggest clients can have on the culture within a law firm. This can leave lawyers feeling 'always on' to service the clients' every need and struggling to manage work for 'less important' clients. There are also serious repercussions if law firms become too embedded in a client relationship, from conflicts of interest to an underdeveloped practice area that is overly reliant on a handful of clients.

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