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A&O Shearman will spend $1.1 billion on AI over five years, more than double Kirkland & Ellis’s $500 million, while Cravath named its largest partner class since 2020 and Sheppard Mullin matched Milbank’s pay scale. Firms are still spending through the downturn, even as Weil Gotshal & Manges’s wind-down feeds rivals, with Dallas private equity partner David Gail the latest to leave, for Simpson Thacher.
On the client side, a roughly $3 trillion one-day selloff pushed the Nasdaq into a correction and exposed cracks in AI-infrastructure financing, as ING shopped data-center loans and Microsoft pulled back from neoclouds. Treasuries rallied, oil rebounded on fresh tanker damage, and the Bank of England kept rate risk live.
Now, on to what matters for your practice today.
Today’s Talking Points
-A&O Shearman’s $1.1B AI bet tops Kirkland as firms keep spending through the downturn
-Weil exits roll on — Dallas PE partner David Gail to Simpson Thacher; Cravath, Sheppard set partner class and pay
-$3 trillion wiped in a day as the Nasdaq enters a correction and chip stocks crater
-AI’s financing cracks show — ING shops data-center loans, Microsoft sours on neoclouds
-Energy M&A heats up — upstream deals hit $12.6B in Q3 as EQT and Crescent lead consolidation
-Blue-wave investigations loom while litigation funders catch a regulatory break
-PE’s exit reckoning nears — JPMorgan sees sponsors forced to sell by 2027
-Watch: October payrolls, a December Fed move, Hormuz tanker risk, Anthropic’s IPO window
Talent Strategy
Latest Moves
Weil’s Dallas private equity partner David Gail is set to join Simpson Thacher & Bartlett after more than 18 years, the latest exit as the firm winds down.
Cravath, Swaine & Moore will promote 11 lawyers to partner on January 1, its largest class since 2020, split between five in corporate and six in litigation.
Sheppard, Mullin, Richter & Hampton will match Milbank’s associate scale from January 1, taking senior associate pay to $455,000 after a 13.7% revenue rise to about $1.4 billion.
Reed Smith’s London fund finance practice has lost senior partners, including Chambers-ranked Bronwen Jones and Leon Stephenson, denting a market-leading team.
What today’s moves tell us: the top of the market is paying up for talent and technology even as Weil’s collapse keeps redistributing partners.
Check our Rolodex newsletter delivered on Monday at 7:30 am for a weekly overview of the lateral market and executive moves.
Operations and Strategy
Firms are spending on AI and defending league-table position even as the market turns.
A&O Shearman will commit $1.1 billion to AI tools and services over five years, more than double the $500 million Kirkland & Ellis pledged in May. It is the largest firm technology budget disclosed so far, a bet that reshaping workflows now outweighs protecting junior billable hours later.
Debevoise & Plimpton is fighting to hold a top-20 spot among M&A advisers after fourth-quarter work for Schneider Electric on its $22.6 billion purchase of PTC and for CD&R on its $5.8 billion deal for Option Care Health; it ranked 14th in 2024 and 2025, and its departures have stayed smaller than at Wachtell and Cravath. Weil’s wind-down, meanwhile, keeps emptying out. Dewey & LeBoeuf’s 2012 collapse and Stroock’s 2023 dissolution both showed how fast a flagship franchise clears once the exits begin, which puts partnership-governance, partner-capital and client-transition work on the clock for the firms absorbing them.
Practices
Corporate M&A and Capital Markets
Energy and strategic consolidation are carrying the deal tape through the selloff. Dealmakers and boards are pressing ahead where the strategic logic is clear, and general counsel are watching governance and structure closely.
Selected Press:
US upstream oil and gas M&A rose to $12.6 billion in the third quarter, per Enverus, with EQT’s $13.8 billion purchase of Range Resources and Crescent Energy’s $4.2 billion deal for Devon’s Eagle Ford assets lifting year-to-date value to $80.5 billion.
Cravath, Skadden and Paul Weiss guided Liberty Media’s buyout of founder John Malone’s super-voting shares, a governance reset at the Malone empire.
CD&R and McKesson’s $5.8 billion purchase of Option Care Health drew a $3.1 billion financing led by Goldman Sachs, Bank of America and Barclays.
Germany will take a 50% stake in tank maker KNDS for $7.3 billion, cutting the odds of an IPO, while Permira agreed to buy a majority of Flint Group from General Atlantic for $1.5 billion.
Wendy’s rejected a $1.4 billion take-private from Nelson Peltz’s Trian and adopted a poison pill.
Private Equity, Credit, and Restructuring
Sponsors face a liquidity reckoning and a jumpier credit tape at once. Private equity’s model ultimately depends on returning capital, so stretched holding periods and nearing maturities are forcing the exit question, which keeps fund-formation, secondaries and workout teams in demand.
Selected Press:
JPMorgan’s Charlie Bouckaert said sponsors will be pushed toward liquidity by the second half of 2027, with 33,853 unsold portfolio companies as of September 30 and holding periods near seven years; he expects more continuation funds and secondaries.
Blackstone doubled the early-withdrawal penalty period to four years for new Hong Kong and Singapore investors in its $29 billion BXPE fund, guarding against redemption pressure.
BC Partners European chair Nikos Stathopoulos is relocating to Greece as the firm opens a Greek office, and LIV Golf will wind down after a BC Partners financing fell apart.
Crowded hedge fund trades unwound fast after a rough October: Walleye Capital is returning capital and closing part of its equities business, and five credit portfolio managers left Brevan Howard.
Energy, AI Infrastructure, and Project Finance
The AI buildout’s financing strain is becoming visible, and the work is shifting from equity raises toward debt, power and workouts as politics and the grid, not capital, set the pace.
Selected Press:
ING is auctioning about $500 million of data-center loans, including a slice tied to the Stargate project, as high-yield bonds from CoreWeave and Galaxy Digital sell off on AI-buildout doubts.
Microsoft is pulling back from neocloud partners Nebius, IREN and Nscale, and declined to expand an Nscale site in Ward County, Texas over a pending energy-connection approval, a setback for Nscale’s IPO.
Qatar’s sovereign wealth fund and Brookfield will back a 1-gigawatt data center at the UK’s Drax Power Station, investing about $3.4 billion over five years in what could be Britain’s largest.
Alphabet is planning a second $1.5 billion prepaid energy bond this year, and the election raised the hurdle for data-center IPOs after peers tumbled.
Regulatory, Investigations, and Litigation
The blue wave resets the enforcement map. Investigations work is set to surge, litigation funders get a reprieve, and a reshaped Texas bench and attorney general change the litigation calculus for corporate clients.
Selected Press:
White-collar and congressional-investigations lawyers expect a surge once Democrats gain subpoena power in January; likely Oversight chair Robert Garcia’s message was “lawyer up,” with targets including the Trump family, corporate donors, pharma and the nine firms that pledged $940 million in free work to Trump.
A Democratic Congress is expected to shelve the Republican crackdown on litigation funding, disclosure rules and funder taxes now look “dead on arrival”, even as delayed settlements spark fights between cash-strapped firms and their financiers.
Texas’s incoming chief justice Maggie Ellis wants the state to let the ABA accredit law schools again, AG-elect Nathan Johnson vowed to drop Paxton-era suits against Johnson & Johnson, BlackRock and State Street, and Harmeet Dhillon resigned as head of the DOJ’s Civil Rights Division.
Baker McKenzie and Squire Patton Boggs were hit with proposed class actions over data breaches, while Google, Meta and TikTok sued California to block its youth social-media law and Google was sued over its Gemini chatbot’s role in a student’s suicide attempt.
Where the Work Sits
***
In previous credit cycles the first cracks have shown up as funding and refinancing problems rather than outright defaults, and ING’s data-center loan sale, Microsoft’s retreat from neoclouds and the slide in data-center bonds fit that pattern.
Private equity’s exit backlog is its own pipeline. With roughly 34,000 unsold companies and maturities approaching, sponsors face sell-side processes, continuation vehicles and secondaries, plus fund-structure work behind tighter redemption terms like Blackstone’s.
A Democratic Congress resets the enforcement map. Subpoena power in January feeds white-collar, congressional-investigations and compliance desks across the Trump orbit, corporate donors and pharma, while a reprieve for litigation funders and Texas’s reshaped high court and attorney general change where and how companies choose to fight.
Energy consolidation is the quieter mandate engine. Record upstream deal value and strategic combinations like KNDS keep oil-and-gas M&A, antitrust and acquisition-finance teams busy, with cross-border review the throughline.
Global Markets
A one-day reversal turned the blue-wave rally into a rout, and clients are rereading risk.
Executives and treasurers are weighing an AI-led selloff that wiped about $3 trillion and pushed the Nasdaq into a correction, while CFOs track a haven bid in Treasuries and an oil rebound tied to fresh Hormuz tanker damage. Markets can move for reasons that have little to do with fundamentals, and decision-makers have to be ready for it. Dealmakers are positioning for a likely December Fed move and tougher oversight of AI and data centers.
Selected Press:
US stocks shed about $3 trillion in a day, the biggest one-day market-cap loss this century; the Nasdaq 100 fell 6.4% and the Philadelphia Semiconductor Index dropped 10%, with the VIX up 61%.
Tesla and SpaceX lost about $130 billion combined as Democratic gains in Texas raised regulatory risk for Elon Musk.
Treasuries rallied, easing the 10-year to about 4.84% on bets a divided Congress caps bond supply, while Fed officials Hammack and Barkin signaled more hikes ahead.
Brent rebounded about 4% to near $98 after three more tankers were damaged in the Strait of Hormuz, and US tariffs on Canadian kitchen cabinets are set to double to 50% on January 1.
Stories to Watch
October Nonfarm Payrolls (today) — the marquee labor print after jobless claims held near 57-year lows; a key read for the Fed and deal confidence.
December Fed meeting — Hammack and Barkin signaled more hikes and markets now lean toward a move, raising financing costs for sponsors and issuers.
US-Iran, Strait of Hormuz — three more tankers hit and talk of resumed strikes; Eurasia Group sees Brent at $110-125 on escalation.
Canada tariffs (January 1) — US duties on Canadian kitchen cabinets double to 50%, a fresh trade-compliance flashpoint.
Anthropic IPO (week of November 16) — the AI backlash now threatens the timing of the year’s marquee listing.
Lame-duck judicial confirmations — Grassley’s hearings run from November 10, and President Trump will nominate the ousted Texas justice to a federal bench before the Senate flips.
That’s the rundown. See you next where law meets the markets.
-The BigLaw Markets Team
*DISCLAIMER: BigLaw Markets analyzes publicly available information, filings, press releases, and news stories published by reputable media sources to deliver content that highlights demand for legal services. Certain production processes may be supported by proprietary AI tools and are subject to human editorial judgement and review.
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