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- A massive transformation is taking place at elite litigation powerhouse Boies Schiller Flexner.
- Over the past six months, more than 30 partners have exited the firm, which was founded by superlawyer David Boies — best known for his role in cases like Bush v. Gore and the fight for same-sex marriage rights.
- Business Insider spoke with more than 50 people, including current and former Boies Schiller attorneys, about the key issues behind the turnover, and events that help explain the firm's shrinking.
- UPDATE: As of June 11, Dunn, the Uber attorney, and BSF vice chairman Bill Isaacson, departed to join Paul Weiss, and David Pressman, an attorney who represented Lt. Col. Alexander Vindman in impeachment proceedings against President Donald Trump, joined Jenner & Block.
- Click here for more BI Prime stories.
In a Ritz-Carlton banquet hall in December 2019, famed trial attorney David Boies made a proposal to his law partners that caught a number of them off guard.
Speaking in front of about 150 lawyers at his law firm's annual partner meeting in Key Biscayne, Florida, Boies suggested changing the firm's compensation formula, according to five people with direct knowledge of the matter.
The change would have cut how much partners earned from their own hourly fees, which was how some lawyers — namely, those responsible for doing the ground work on cases — earned seven-figure paychecks without generating their own clients.
Instead, more money would go to satisfy top rainmakers, with a discretionary bonus pool set aside to pay other partners as they saw fit.
Boies proposed reducing partners' cut of their hourly fees by as much as five percentage points.
Some in attendance did not see the move as being in their own interest, while others voiced concern because they wanted to better understand the implications of the proposal.
It was not something that had been discussed at an equity-partner meeting the night before, and some were somewhat taken aback by how casually the topic had been slipped into the partner meeting, according to people familiar with their thinking.
Those who voiced concern included Karen Dunn, a partner who represented Uber in a trade-secrets case with Waymo, as well as David Willingham, who had represented individuals charged in the Varsity Blues college-admissions case.
After receiving pushback, Boies tabled the topic.
All the pay talk was a sign of the times for Boies' firm, Boies Schiller Flexner, which had for years been at the center of some of the world's most high-stakes business disputes, including Amazon billionaire Jeff Bezos in the fight against National Enquirer parent company American Media, and Blackwater founder Erik Prince in his defamation lawsuit against The Intercept.
Its attorneys had been discussing how best to transition the firm so that its future wasn't as closely intertwined with that of Boies, who is currently 79. Pay was one of the central features that needed to change, many of those attorneys believed, given that Boies' partners historically were paid to staff cases that he and other founding partners brought in.
Going forward, at least some inside the firm felt partners should be incentivized to bring in new clients.
"The proposal, by definition, was not in the short run economic interest of a partner who was not, themselves, generating business," Natasha Harrison, one of BSF's newly installed co-managing partners, told Business Insider.
![Natasha Harrison, co-managing partner, Boies Schiller Flexner]()
She said that some partners had supported the proposal, and that at the meeting Boies had been elaborating on a note that had previously been shared with partners. At least one attorney who was there acknowledged that the plan was shared in advance, but said it wasn't discussed in detail.
It didn't help Boies' cause, though, that some in the room felt that he should reduce his own pay, taking issue with an arrangement for founders that grants him a cut of revenue, in perpetuity, so long as his name is still on the door.
"That was a huge sticking point," recalls one lawyer. "Everyone calls it, 'The Tail.'"
Harrison said that Boies had reduced his equity shares over the years, to the point where his equity shares were below the percentage of firm business Boies generated.
It wasn't the first time that the lavish affair, where attorneys were treated to specially catered meals, tequila tastings, and a roll-your-own cigar booth complete with custom BSF labels, was overtaken by shop talk about the leadership and direction of the firm.
And at least on one other occasion, the conflicting interests of certain partners were laid bare at the family-friendly annual retreat.
Two years earlier, a tense exchange in which one partner threatened another in a Ritz-Carlton lounge, fueled a division between groups of partners who shared different visions of what BSF would become — and who would lead it.
What has happened within BSF since the 2017 annual meeting — which took place shortly after Boies took heat for his role as long-time lawyer for Hollywood mogul Harvey Weinstein, who has been accused by more than 100 women of sexual misconduct and was convicted in February 2020 of sexually assaulting a former production assistant and raping a onetime aspiring actress — is key to understanding the transformation firm leaders are now trying to pull off.
And the tensions have come to a head over the past six months, according to current and former Boies Schiller attorneys. More than 30 partners have exited the firm, including the only two women of color who were equity partners and other senior partners with a collective book of business in the tens of millions of dollars.
A massive transformation
Business Insider interviewed more than 50 people, including current and former attorneys, staff, and others close to the firm, to learn about the events that have led up to this exodus and a firm-wide restructuring that includes consolidating offices and bringing in fresh talent to ensure future growth.
![Nicholas Gravante, Boies Schiller Flexner]()
Nicholas Gravante, the son of a lawyer who was famous for representing New York organized-crime families; and Harrison, a London-based lawyer, are overseeing the changes after being elected as new co-managing partners in December 2019.
Their efforts include reforming the firm's pay system — discussing changes to partner pay that include better rewarding younger business generators, while offering associates a more lockstep approach, based on seniority and hours worked. And, they are discussing the creation of practice groups to organize attorneys, something the firm has not historically done.
At the same time, they have delivered firm-wide video updates during the coronavirus pandemic, including one recent call in which Gravante gave associates a talk about how to develop business.
"They are modernizing and standardizing things," said BSF associate Demetri Blaisdell. "A lot of people are looking to see what's going to happen. And those of us who are at the firm are still curious to see what the firm will look like if David and Jonathan [Schiller] are no longer managing. It will be very interesting to see what Nick and Natasha do."
Some of the recent partner exits, though, have brought turmoil to the firm at an already tumultuous time, according to sources. The coronavirus pandemic has prompted even elite law firms to institute pay cuts, furloughs, and in some cases layoffs as deal flow dries up and litigators work around court closures.
Though BSF has not laid off attorneys because of the pandemic, it has fired staff members who worked closely with partners who recently departed.
For the firm, which has already dealt with negative press from David Boies' defense of Weinstein and failed medical-technology firm Theranos, the business challenges have come with unwanted solicitations from rivals.
"Neither we, nor our clients, think the future of the firm is in doubt," Gravante told Business Insider. "BSF fully intends to maintain its position as an elite, market leading litigation firm."
Other firm attorneys, too, have expressed optimism about its future, citing litigation opportunities arising from the coronavirus pandemic.
"We know from past experience that when businesses experience disruption — even disruptions less severe than this — what follows is litigation, and often complicated litigation that raises interesting, cutting-edge questions. And that's what we've always done," said Bob Cooper, a partner at BSF in Washington, D.C.
In a league of his own
When Boies was in his prime, firm management almost seemed like an afterthought.
A litigator known for his love of fine wine and playing craps, Boies has always played in his own league in the clubby world of white-shoe lawyers. His rise in the legal profession, which came despite dyslexia and being raised in an Illinois farm town, was a spectacle that the media ate up. In the 1990s, he grilled Bill Gates in the Justice Department's antitrust case against Microsoft, and then came to the side of Al Gore in the Florida recount of the 2000 presidential election.
The firm he formed in 1997, upon departing Cravath, Swaine & Moore, became known for taking on bold cases, giving associates meaningful work, and paying them higher bonuses — often in the six figures.
In some of his busiest years, Boies defended former AIG chairman Hank Greenberg against charges brought by the New York Attorney General that he hid the true financial condition of the insurance giant and duped shareholders. The trial took place in 2016, more than a decade after those charges were first filed.
He also helped secure multi-billion dollar settlements on behalf of American Express in 2008, which had tussled with Mastercard and Visa over antitrust disputes.
The money that flowed from such cases made Boies Schiller one of the most profitable law firms in the industry, with associates and paralegals working 100-hour weeks, holed up in hotel war-rooms before trials.
"Do you want to sleep or do you want to win?" Boies would say.
Any concerns about firm management were muted in a sea of riches.
Questions around transparency
Insiders say there have been years-long efforts to institutionalize Boies' firm, pass down client relationships, and promote younger partners into firm management positions. Attention has been given, in particular, to what Boies likes to call "core client" relationships, which have consisted of large financial institutions and other corporate giants.
But as his firm added headcount and his representations and tactics in working for some clients drew scrutiny, some partners, for a variety of reasons, felt the firm was no longer for them.
Some of them were concerned about the prospects for successfully transitioning the firm from an informally managed one, with power consolidated at the very top, to an institution with checks and balances and transparency into management decisions.
Harrison said that there are currently sufficient checks and balances, pointing to an executive committee, a finance committee, and administrative partners for each office who oversee attorney work.
She also said that the chairman and one-third of the executive committee are elected by secret ballot each year at the firm's December meeting.
"One of the Firm's unique attributes is its informality and collegiality blended with the top lawyers and standards of a 'white shoe' law firm," Harrison told Business Insider.
Others, though, felt that the firm needed additional transparency into decision making.
As of early 2020, equity partners did not know how much the founders were paid, nor did they have an electronic copy of the partnership agreement they signed, causing concern among some partners who wanted better access to financial information, like firm profits, revenue, and equity shares, according to people familiar with the matter.
Adding to the transparency concern were instances of miscalculations of associate bonuses, along with some partners' realization that they were being paid less than what they could earn at competitors.
As for the partnership agreement, BSF co-managing partner Gravante said it is not disseminated electronically to avoid public distribution.
He also said that BSF was common with many law firms in that it has a closed compensation system. The firm has periodically considered at its annual meeting whether to make more information available, like equity shares of partners other than the founding partners, but each time it has gone to a vote, the vote has been to restrict that information to the executive committee, he said.
BSF co-managing partner Natasha Harrison acknowledged that the firm's business support functions have "at times trailed the success of the firm," but that it has and will continue to invest in its infrastructure. She pointed to new hires in HR and the firm's effort to convert to a new financial system in 2021.
"In terms of the formula compensation bonuses – miscalculations are unusual but do happen from time to time; far more often, a lawyer has mistakenly believed there was a miscalculation," she said.
No no-nepotism policy
The transparency concerns, according to some former BSF attorneys, were only one part of the equation.
A lack of a no-nepotism policy also rankled some attorneys, who saw this as emblematic of how the firm was controlled by a few at the top.
Children and personal friends of founders David Boies and Jonathan Schiller have long been employed by the firm in a variety of roles. It had been a longstanding joke among some paralegals and associates, who coined a name for the treatment: "The Friends & Family Plan."
Current management says they are not aware of any other law firm with a written no-nepotism policy, and that no partner had ever proposed introducing a formal policy.
Kent Zimmermann, a consultant to law firms, said that no-nepotism policies exist at some but not all law firms.
"A no-nepotism policy can be helpful because some firms believe that it prevents the appearance of favoritism and actual favoritism," said Zimmermann.
"I think many businesses, and law firms generally, don't want to hire people that they can't fire," he said.
As for Boies Schiller, a handful of insiders pointed to instances that highlight the perceptions of favoritism created by having people with close ties to founders working in prominent roles — the very kinds of situations that no-nepotism policies that may be more common in other industries are designed to ward off.
One of Schiller's sons, Aaron, for instance, was hired as architectural designer to help open the firm's San Francisco office in 2019. He had also been engaged by senior partners to design the firm's New York and Washington, D.C. offices.
By a number of accounts, the offices turned out to be high-quality, but the mere hiring of Schiller left some attorneys wondering how much the firm paid him. Two people familiar with the San Francisco office said there was concern about how hard they could, or should, push back on any draft plans.
Gravante said that Aaron Schiller is an "outstanding, innovative, and award-winning architect, and his selection for the SF office assignment was made entirely by partners other than Boies and Schiller, based on the fact that both his design was preferred and his cost was less."
Aaron Schiller said there was a competitive bid process with senior partners for the three office redesigns. He also said he was unaware of any concerns or criticisms and provided emails from partners praising the San Francisco office design.
"I was selected on the merits by the senior BSF partners responsible for the design and the budget of those offices," he told Business Insider in an email.
Gravante said the original design was reviewed with office lawyers, who expressed a desire for more individual offices, and the design was revised to accommodate their requests.
![Boies Schiller Flexner New York]()
The issue of perceived favoritism had reared its head on other occasions, though, too. This includes when another Schiller son — Joshua Schiller, who has worked at the firm for more than a decade — took on work for certain clients and some in the firm thought favoritism played a role, according to people who worked there.
One of the biggest cases Joshua Schiller worked on included helping to overturn California's Proposition 8 ban on same-sex marriage.
"The only thing I have ever received in credit from the firm has been due to my hard work and the business I have generated, which is substantial," Joshua Schiller said by email.
BSF co-managing partner Gravante told Business Insider that Joshua Schiller was one of the firm's next generation of "outstanding lawyers and business generators."
"While the Firm may have included a limited number of associates connected with the family in its founding years, it has evolved to become an elite professionally run firm," he said. "There has not been a lawyer hired by the Firm in the last five years related to the Founding Partners."
"In terms of the children of Boies and Schiller who the Firm has employed, they each graduated from top law schools (Columbia, NYU, and Yale) and are outstanding lawyers in their own right," he said. "No one has ever expressed resentment or concern around their employment, including pursuant to the Firm's procedure for personnel to express concerns and complaints anonymously."
However, three sources familiar with the matter described an incident which triggered a complaint made by a female associate regarding Joshua Schiller.
In 2017, at an evening New York outing with BSF attorneys, Joshua Schiller made what sources familiar with the matter described as inappropriate comments in front of a female associate. The associate later raised the issue to firm management and Schiller was taken off of a case she was working on, said one of these people, who was directly familiar with Joshua Schiller's reassignment.
"I was having an animated conversation with colleagues after a day of trial, and I do not believe that anything I said was inappropriate," Joshua Schiller said in an email.
Jonathan Schiller did not provide comment for this article. The firm's representative did not provide immediate comment on the events described by the three sources.
Nepotism was one of the many things that some in a younger generation of partners wanted to address when they acquired more power as Boies' reign faded.
Boies' backlash
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In 2017, some of the firm's younger partners who served on a junior management committee included Dunn, a lawyer for Uber and Apple; Damien Marshall, whose clients have included DraftKings and HSBC; and Michael Gottlieb, a partner who was a former US Supreme Court clerk and associate counsel to President Barack Obama.
Their work took on new meaning when Boies' representation of Weinstein came under sharp review, as numerous accusers aired complaints of sexual harassment and assault.
As has now been well-reported, Boies, considered Weinstein's closest legal adviser, had signed off on a contract to hire Black Cube, an Israeli intelligence agency, to investigate reporting from The New York Times about Weinstein's conduct.
The New York Times, which had hired BSF to represent it in an unrelated matter, fired his firm in November 2019. Boies wrote in a memo to his own firm to explain himself, saying that he would never knowingly silence women, and that it was a mistake to contract with Black Cube without having control over its investigators.
The following year, The Wall Street Journal reporter John Carreyrou wrote the book "Bad Blood," which detailed Boies' representation of Elizabeth Holmes, the founder of Theranos, the blood testing startup which shuttered in September 2018. Holmes is facing a criminal fraud trial slated for later this year.
BSF had stopped representing Holmes in 2016, and Weinstein, in late 2017.
Firm fallout
The press coverage surfaced in conversations some BSF attorneys had with their clients, including tech companies, Hollywood studios, and some large financial institutions, according to six people familiar with the matter.
One attorney spoke of clients who said that they couldn't give the firm work because their company wasn't supposed to hire the firm generally, but this person declined to name an example, citing attorney-client privilege.
In late 2019, The New York Times reported that Boies had discussed a plan to secure settlements from powerful individuals caught on video engaging in lewd sexual acts with young girls. The tipster who claimed to possess these contents turned out to be a possible fraudster who never delivered the information he purported to have. Boies later said that the coverage was unfair, telling NPR that, he "didn't do anything deceitful here, and there's no basis for that allegation."
The firm continued to work on at least one high-profile gender-related matter, too: a matter for WeWork that ended in a $2 million settlement for a former employee in 2018.
Business Insider could not confirm any specific clients who had taken issue with Boies' representations.
Divide
When the chatter about Boies' representation of Weinstein started, in 2017, it caused some soul-searching within the firm. Partners discussed how to best move beyond what some considered to be a painful period in the firm's history.
At that time, there was a division emerging between partners in the firm, according to people who worked there at the time. And at the center of it was a lawyer with whom Boies had practiced for much of his career.
Some of the tension surfaced during an effort to collect partners' signatures in a statement of support for Boies following news reports of his role defending Weinstein — a letter that essentially told Boies that attorneys stood behind him and were grateful for all the contributions he had made over the years.
One of the partners leading the effort was Gravante, the firm's then-general counsel and a former Cravath lawyer who had joined BSF in 2000.
After the letter was sent to partners in an email, Gravante and two other senior partners phoned them up individually to make sure they had seen it.
The outreach struck some BSF attorneys as a poor display of judgment, given that some lawyers who the senior partners contacted had never met them. Some noted that bonuses and promotions were soon to be announced, and that timeline could have made junior partners feel pressured to sign.
A BSF spokesperson told Business Insider that the letter to Boies was a short and simple personal gesture of gratitude.
Gravante said that he was aware certain partners were unhappy with him about the letter, but he has never made it a practice to only do what is popular and accepted by all.
"I lead by doing what I think is right for the institution," he said. "And I have long believed that people should vote their conscience."
A firm spokesperson said that partner pay and promotions had been determined by the time partners promoted the letter of support.
Things escalated a couple weeks later, in December, when some partners voted not to re-elect Gravante to the firm executive committee at the annual retreat in Key Biscayne, in a show of hands while executive committee members left the room.
Later in the weekend, one partner who voted against Gravante, Michael Gottlieb, was seen chatting with some lawyers in a Ritz-Carlton lounge, when Gravante approached their standing table.
Gravante laid into Gottlieb with profanities and threatened him, according to people with direct knowledge of the matter. The two soon stepped outside to hash things out, monitored by attorneys who feared the exchange could turn physical.
The two later shook hands that night and the dispute was mediated, but after that point, Gottlieb didn't think Gravante should be in a position of power and other partners took sides, according to people familiar with the matter.
Gravante said he had approached Gottlieb because he was upset about a phone call that took place with him about the letter to Boies and thought Gottlieb spoke to him inappropriately. He said that he's since moved on after they apologized to each other.
"I happily left this kind of drama behind me over a year ago when I joined a new firm that is better aligned with my values, practice, and clients," said Gottlieb, in a statement.
Following the 2017 exchange, the firm instituted a new policy that partners would vote by secret ballot, according to people familiar with the matter.
Soon, two distinct camps crystallized.
Some felt Gravante should continue to serve as a firm leader. He was one of the biggest business generators at the firm, with clients including Starr International. He also had a nice touch when it came to developing new client relationships and had worked by Boies' side since the early years of BSF's existence.
Others, however, felt that leadership shouldn't be about someone's book of business, and that a firm leader shouldn't threaten another partner and expect to continue in firm leadership.
When BSF continued to support Gravante in a firm leadership role, Gottlieb departed for Willkie Farr & Gallagher.
BSF placed Gravante on a four-person management team in late 2018, though the team disbanded after a year. Gravante had talked with other law firms about employment opportunities in 2018, according to two people familiar with the matter, but he was elected co-managing partner in December, alongside Harrison.
Future firm
Throughout 2020, BSF saw a rush of partners exit.
Lee Wolosky, an ambassador under President Obama who implemented efforts to close the Guantanamo Bay detention camp, joined Jenner & Block in February; along with Dawn Smalls, who alongside Wolosky is overseeing Deutsche Bank as part of an independent monitorship resulting from a settlement the bank reached over regulatory investigations.
Willingham, the attorney who represented individuals in the Varsity Blues college-admissions case, joined King & Spalding, along with 14 other BSF partners, two of whom will join at a later date after working out a conflict of interest with a client.
In one goodbye note to colleagues in early April, Stacey Grigsby, a lawyer who had represented Uber, noted she was leaving for Covington & Burling, with the word "voluntarily" in parentheses.
"I think that voluntarily was not lost on anybody," said one person who saw the email.
As partners left, BSF co-managing partners, Gravante and Harrison, said they were restructuring the firm.
Options
Consultants and recruiters tell Business Insider that, even given its smaller size, BSF can still carry on as an independent firm focused on high-stakes litigation. The firm may have grown larger than it should have, and is now re-focusing its resources, some current partners suggested.
On the other hand, there is always the possibility of a combination with a larger firm, as it had entertained in recent years when it spoke with the law firm of Cadwalader, Wickersham & Taft, according to several people familiar with the matter.
Gravante and Harrison said that the firm has no plans for a merger.
"The firm has always been open to listening if something like that presented itself," said Sigrid McCawley, a Florida partner. "But there are no plans."
Gravante declined to comment on the Cadwalader talks. Cadwalader managing partner Pat Quinn did not respond to a request for comment.
The question facing the firm now is whether and how many other partners will leave, and how much revenue those individuals may bring with them if they do. Some at the firm say that more partners are expected to leave, and they describe the attrition as part of a strategic plan.
Bobbie McMorrow, a consultant to law firms, said that the growing pains felt by Boies is, in a way, history repeating itself.
McMorrow has worked with elite trial firms in generational transition planning. "It's always fascinated me for 30 years," she said.
Each story is similar: A prolific trial attorney creates a firm. They get famous and rich by becoming a client magnet, advising governments, business leaders, along with Wall Street and Hollywood executives.
They become so important that they run their firms however they want, in a free-wheeling culture. But when the founder nears retirement, partners disagree about the firm's future.
"It might take 10 or 20 years, but they all get into trouble."
SEE ALSO: The inside story behind a 15-partner exodus at elite law firm Boies Schiller
SEE ALSO: Elite law firm Boies Schiller just cut associates and support staff following a partner exodus
SEE ALSO: WeWork paid over $2 million in cash to a woman who threatened to expose claims of sex, illegal drugs, and discrimination in a horrifying 50-page document
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She said that some partners had supported the proposal, and that at the meeting Boies had been elaborating on a note that had previously been shared with partners. At least one attorney who was there acknowledged that the plan was shared in advance, but said it wasn't discussed in detail. 
Nicholas Gravante, the son of a lawyer who was famous for representing New York organized-crime families; and Harrison, a London-based lawyer, are overseeing the changes after being elected as new co-managing partners in December 2019.
