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How Heenan Blaikie’s stunning collapse started with a rogue African arms deal

It’s amazing how quickly Heenan Blaikie fell apart

The stunning collapse of Heenan Blaikie LLP, once one of Canada’s largest and most prestigious law firms, stemmed from a “loss of trust” in management over international business activities including dubious forays into Africa, where former partner Jacques Bouchard and former prime minister Jean Chrétien lobbied governments on behalf of clients, former Heenan partners and associates say.

Founded in Montreal in 1973, Heenan grew from 18 lawyers to more than 500, in offices across Canada and in Paris, where it established a beachhead in 2009. It was considered a rock-solid full-service firm — and a favourite of the Canadian establishment — until a crisis of confidence caused its foundations to crack. Lawyers began leaving, first in a trickle, then in droves, and the whole enterprise came crashing down this month.

Increasing financial pressures and friction between partners in Montreal and Toronto were key factors behind Heenan’s failure, the biggest ever for a law firm in Canada. “Montreal didn’t understand Toronto; Toronto felt the Montreal office was way overpaid and overpraised,” said one former partner.

But many also agree that Heenan’s excursions into Africa caused so much tension and tumult that partners began shaking their heads and taking their leave. “People like me said to themselves, ‘I want to work at a firm that values the practice of law in Canada, not international dictators,’” another former Heenan partner told the National Post. “It’s not what I signed up for.” He quit the firm last year.

There came “a point where confidence and faith started to disappear,” said Jean-Francois Mercadier, managing partner of the firm’s former group in Paris, Heenan Blaikie AARPI. “Partners started to lose any kind of faith in the management of the firm. There was a loss of trust in the partnership, and I think the origin is in the Jacques Bouchard story.”

Related: The End of Big Law: What Happens When the Money Dries Up

via @dlcrawford

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