Law Firms Follow Money in Credit Mess
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CNYB 02-11-08 A 1,2 2/8/2008 7:49 PM Page 1 TOP STORIES INSIDER Is Mike Spitzer invests a winner or millions in stem loser after cell research Super PAGE 2 ® Tuesday? PAGE 14 Costume jewelry shines on the runway, heads to VOL. XXIV, NO. 6 WWW.CRAINSNEWYORK.COM FEBRUARY 11-17, 2008 PRICE: $3.00 store counters PAGE 3 MADE IN CONNECTICUT Law firms Leon Black’s LBOs fizzle as investor loses his touch follow money PAGE 3 EVERYBODY’S THE BRONX CONFESSIONS The 2 best choices FINE IS BURNING OF A SHOPAHOLIC in credit mess Robert De Niro stars John Turturro and Isla Fisher plays an to develop the in this soon-to-be- Oliver Platt were cast NYC journalist in this Hudson rail yards released film. in last year’s miniseries. upcoming movie. “These problems are going to ex- getty images With millions pand to such a dimension that it EDITORIAL, PAGE 12 at stake, hundreds will consume vast amounts of lawyers’ time.” assigned to bolster Among the first was power- MY FUNNY Film producers house Greenberg Traurig, which subprime practices has 1,750 lawyers. It began build- VALENTINE ing what is now a 48-member BY HILARY POTKEWITZ SMALL BUSINESS roll out of the city group in August. Mintz Levin Cohn Ferris Glovsky and Popeo Dating first came the $211 billion in launched its 25-lawyer practice in services all production costs in 2006—the write-downs of subprime debt, December; Pepper Hamilton fol- rake in Bigger incentives most aggressive incentive program now comes the legal bo- lowed in February with its lover-ly boost Connecticut, in the country—a growing number nanza. 70-member credit crisis re- profits of feature films slated to shoot in In the past four months, sponse team. Many other PAGE 19 other NE states New York have fled to those green- nearly 20 law firms have 500LAWYERS firms, including Bryan er pastures. In the past year alone, set up subprime practices have been Cave, are mulling plans for drafted to sort VALENTINE NO MORE? BY MIRIAM KREININ SOUCCAR New York has lost about $400 mil- comprising more than 500 out subprime their own subprime groups. Unofficial lion in production revenue to Con- attorneys, many of them in suits to date At Bingham Mc- breakup the strike by the Writers Guild necticut and an additional $350 New York. Not since the Cutchen,65 partners make season of America that has shut down million to nearby Rhode Island savings and loan crisis two de- up a subprime practice that didn’t leads some production for more than three and Massachusetts, both of which cades ago have so many law firms exist two months ago. Such top to sell months is expected to end this have lucrative incentive programs moved so fast to create a whole new firms often bill in the range of $600 old rings week,but New York’s film industry as well. discipline. to $800 an hour. Amy Kyle says and gowns has even bigger problems on its Remember the critically ac- “It’s a sea change,” says Marvin she is already drawing additional PAGE 27 horizon. claimed miniseries The Bronx Is Pickholz, the partner in charge lawyers from the 1,000-attorney Since the state of Connecticut Burning? That ESPN show was of Duane Morris’ month-old, 15- firm and is open to hiring more le- started offering a 30% tax rebate on See FILM PRODUCERS on Page 8 lawyer subprime practice group. See LAW FIRMS on Page 8 AT DEADLINE NEW YORK’S THREE MAJOR AIRPORTS COULD SEE reductions in flights if merger talks now under way lead to a Calorie rules hit fine-dining spots combination of Continental Airlines with United Airlines Steakhouses, other and Northwest Airlines with Delta Air Lines.The two chains fear putting merged entities would control info on their menus 40% of the roughly 110 million passengers who pass through the area’s three main BY LISA FICKENSCHER airports and would eliminate overlapping routes. a year ago, when the city’s Board of Health took aim at obesity, fast- A NEW COLLECTION OF food restaurants were on the hot ADVOCACY GROUPS IS seat. But now the McDonald’s of joining forces under the the city are in highfalutin company. banner of the Health Care for A new, broader version of the All New York Campaign in rule, which was passed last month, hopes of passing universal targets some of the toniest eateries health coverage in the state. around town as well as casual full- The Community Service service spots. Cash-consuming See AT DEADLINE on Page 2 restaurants such as Ruth’s Chris See CALORIE on Page 8 06 5 RICK JURMARK says that seafood restaurant McCormick & Schmick’s has been “caught ELECTRONIC EDITION in the crossfire.” NEWSPAPER james cooper james 71486 01068 0 CNYB 02-11-08 A 1,2 2/8/2008 7:49 PM Page 2 AT DEADLINE Continued from Page 1 taking the time needed to do the Society of New York leads a core job properly. group that includes the Ameri- can Cancer Society, Children’s THE NATIONAL PARK SERVICE Defense Fund, Citizen Action SAYS IT EXPECTS TO MOVE of New York and New Yorkers Hamilton Grange, the historic for Accessible Health Coverage. home of Alexander Hamilton, CSS was recently awarded a to Harlem’s Saint Nicholas Park multiyear grant of $750,000 in May and to reopen it to from the Robert Wood Johnson visitors in the fall.The museum Foundation to fund HCANYC. closed two years ago so that architects could evaluate a URBAN LIFESTYLE AND relocation plan, and excavation SHOPPING MAGAZINE work began recently.The home Complex is launching a is being moved about 300 feet. television advertising campaign this week that will promote the A 20-UNIT RESIDENTIAL title’s brand and Web site.The BUILDING WITH TWO approximately $1 million restaurants on the ground floor campaign will air in two-week at 21-23 Peck Slip was sold for spurts, timed to when each issue $16.5 million to Italian real comes out. Complex appears estate company E.D.E. SRI. seven times a year.The 15- Eastern Consolidated brokers second ads will run on at least a Martin Ezratty and Brian dozen channels that reach the Ezratty represented the seller, magazine’s target audience of Peck Slip Associates, and young men, including MTV, Charles Castelli of Century 21 BET,Fuse and ESPN. Castle Real Estate represented the buyer. Building rents range THE REAL ESTATE INDUSTRY IS from $2,000 to $5,000 a month. BECOMING IMPATIENT AS THE neff david city continues to work on a THE AIRTRAIN RAIL SYSTEMS IN THE MIX: Researchers working on stem cell projects at New York University received money in the state’s current round of grants. study of how to reduce SERVING JOHN F. KENNEDY construction costs, which have International and Newark been rising 10% a year. Deputy Liberty International airports Mayor Bob Lieber was recently both achieved record ridership asked at a Brooklyn Chamber of figures last year. AirTrain JFK Commerce forum why “there’s served more than 4.4 million Investment in research been radio silence for months” paid passengers, a 12% increase on a study that many expected over the prior year. AirTrain would be completed last Newark handled nearly 1.8 New York pours big bucks into stem cell science summer.The city Economic million riders, an increase of Development Corp. says it is 13.5%. BY GALE SCOTT CORRECTIONS in doling out nearly $55 million this year for stem cell research, Gov. Eliot Spitzer is Richard Dreiling left his position as CEO of Duane Reade Holdings Inc. for a job at Dollar General. The name of his new employer was misstated in the Feb. 4 “Hot Jobs” profile. establishing New York as one of the leading states seeking to cash in on this emerging field. Because the Small Business Administration supplied incorrect information, dollar amounts The grants are the first installments of $600 million that Mr. Spitzer has promised for stem were misstated for several loans in the Jan. 21 list of the largest SBA-guaranteed loans in cell research over 10 years.That leaves the Empire State behind California, which has fiscal 2007. The correct total loan values are: Howard Johnson, $6,000,000; A. Schneller Sons, $4,816,000; C. Kenneth Imports, $4,374,000; and Family Car Wash, $4,290,000. committed $3 billion over the next decade, but ahead of Wisconsin, which is building a $150 million stem cell research institute, and Texas, with $41 million dedicated for a research facility. New Jersey would have been third on the list, but in November voters there rejected a THIS WEEK IN CRAIN’S referendum to spend $450 million on such research.The state still plans to build a $150 million research facility in New Brunswick. ALAIR TOWNSEND -------------------13 “We’re doing very well under the Spitzer administration, second only to California,” says 29 See NEW YORK on Page 9 THE INSIDER------------------------------------14 REAL ESTATE DEALS--------------15 THE WEEKS AHEAD ----------------15 WEEK IN REVIEW -----------------------16 Tech incubator closing REPORT: SMALL BUSINESS----------------19 $150,000 from the Empire State cial tech provider YellowJacket Software group cites Development Corp. and Rudin Software,graduated in 2007 and re- CLASSIFIEDS ----------------------------------24 lack of state grants; Management, the property’s owner. cently entered a deal to be bought by The facility’s tenants were notified IntercontinentalExchange, an At- NEIGHBORHOOD will probably have to of the shutdown three months ago.