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Latham & Watkins pulled its fifth partner from Wachtell Lipton since February 2025, hiring executive compensation partner Erica Aho -- the latest in a string of early-tenured departures that signals a broader talent shift at the top of Big Law. Sidley Austin crossed $3.74 billion in revenue and is now targeting $4 billion.

On the client side, OpenAI has been working with Cooley, Wachtell, Goldman Sachs, and Morgan Stanley as it prepares to go public very soon. Nvidia reports earnings today after committing $90 billion to AI deals potentially attracting attention from antitrust authorities, and SpaceX tapped Goldman Sachs alongside Gibson Dunn and Davis Polk to lead what could be the largest IPO ever.

Now, on to what matters for your practice today.

Today’s Talking Points

-Latham Pulls Fifth Wachtell Partner

-Steptoe Adds Four Winston Sanctions Partners / Distressed Debt Hiring Heats Up at Gibson Dunn and Willkie

-Sidley Targets $4B Revenue / Paul Weiss Rebalancing Accelerates / Wachtell and Elite Firms Rethink Partner Pay

-OpenAI prepares to file for IPO in next few days or weeks / UK M&A Triples to $192B / Tech IPO Pipeline Builds

-AI Convertible Bond Surge Hits $34B / Citi-BlackRock HPS Launch $17.5B European Private Credit Program

-CRE Distress Mounts at $130B / BlackRock TCPC Under Federal Probe on Valuations

-30-Year Yields at 2007 Highs / Hormuz Closure Nears Three Months / UN Cuts Global Growth Forecast

-Nvidia Earnings Today / SpaceX IPO Prospectus Expected Wednesday

Talent Strategy

Latest Moves

Latham & Watkins hired executive compensation partner Erica Aho from Wachtell Lipton -- the fifth partner to leave the firm for Latham since February 2025. The continued exodus of early-tenured partners marks a notable talent drain at one of Big Law's most selective partnerships.

Steptoe added four sanctions and white collar partners from Winston & Strawn in Washington: Cari Stinebower, Christopher Man, Mariana Pendas Fernandez, and Dainia Jabaji. Latham also hired Kirkland litigator Carson Young in Houston for complex commercial litigation.

Other moves: Willkie Farr added finance partners Greg Gartland and April Doxey from Winston & Strawn in Chicago. Simpson Thacher expanded its NY banking practice with Marten Olsson. Orrick hired two partners for Paris life sciences. Cleary Gottlieb added regulatory partner Greg Larkin from Goodwin in Washington.

What today's moves tell us: Firms are competing for private capital expertise and trade-sanctions capability, with sponsor-side and national security work driving the latest hires.

Operational Strategy

Revenue targets are climbing, compensation models are shifting, and firms are rethinking how they manage external counsel relationships.

Sidley Austin crossed $3.74 billion in revenue last year and has its sights on $4 billion. Chair Yvette Ostolaza said the firm is focused on strategic lateral hiring with formal integration plans and is willing to pull back from underperforming practices and geographies.

As Bloomberg Law reports, the Paul Weiss rebalancing has accelerated. Leadership changes, notable exits, associate cuts, and continued controversy over the firm's deal with the Trump administration have compounded the firm's identity shift toward a top M&A and private equity platform. Litigators are feeling the effects. Separately, according to Legal Business, Wachtell and other elite firms are tearing up traditional lockstep partner pay models as the competition for top talent forces even the most conservative partnerships to adapt.

In the Gulf, partner promotions are declining as Middle East tensions mount. At least one US firm has lowered its billable-hour threshold from the typical 2,100-2,200 range and shifted to a three-year performance average. And Revolut legal chief Tom Hambrett is replacing its traditional law firm panel with a performance-based system of quarterly reviews on pricing, quality, and engagement with the company's products.

Practices

M&A and Capital Markets

The mega-deal pipeline is building across energy, tech, and cross-border transactions as IPO momentum accelerates.

Wall Street is preparing for a tech IPO wave after Cerebras' $6.4 billion raise. OpenAI is expected to file its IPO prospectus in the coming days or weeks after working with cooley, Wachtell, Goldman Sachs, and Morgan Stanley bankers. SpaceX tapped Goldman Sachs for the lead left role on its IPO next month (expected to be the largest ever) with Morgan Stanley, Bank of America, Citi, and JPMorgan rounding out the top banks. The prospectus is expected as soon as Wednesday. AI-linked companies are also driving a record pace in US convertible bond issuance, which reached $34 billion in the first four months of 2026, more than double the prior year.

NextEra Energy's $67 billion bid for Dominion Energy is the largest utility acquisition in US history, with Kirkland and McGuireWoods advising. The combined enterprise value will reach $420 billion. Foreign bids have driven UK M&A to $192 billion in 2026 -- tripling from the same period last year -- led by deals for Intertek, Schroders, and Unilever's food unit. Linklaters and Hogan Lovells are advising on the GBP 2.7 billion Tate & Lyle takeover.

Private Equity and Credit

Private credit partnerships are expanding into Europe while US valuations face new scrutiny.

Citi and BlackRock HPS are launching a program to offer up to EUR 15 billion ($17.5 billion) in sub-investment grade debt to corporate and PE clients across the UK and mainland Europe over the next five years. HPS, acquired by BlackRock for about $12 billion, already manages a $129 billion direct lending portfolio. Blackstone is separately investing $5 billion in an AI cloud venture with Google based on the tech giant's specialized chips.

Federal prosecutors are examining BlackRock TCP Capital Corp (TCPC) over private credit valuations. Executives have been interviewed by the Manhattan US Attorney's office, and shares have dropped 29% this year. Regulatory scrutiny of the $1.8 trillion private credit asset class is tightening after redemption shocks at semi-liquid vehicles forced some managers to gate retail investors.

Restructuring and Distress

CRE lenders are accepting steep losses as the higher-for-longer rate environment eliminates hopes of a market rebound.

Commercial real estate lenders are moving faster to offload troubled US assets, with some accepting prices as low as 15% of loan payoff amounts. The pile of distressed commercial-property debt sits at $130 billion. Sales of distressed offices jumped 45% in Q1 year-over-year, and CMBS loans in foreclosure hit $17 billion -- up from $7 billion in 2024 and the highest since the post-GFC resolution period. According to Moody's, over one-third of distressed exchange deals end up in default.

Regulatory and Investigations

Regulatory activity spans energy trading, AI competition, and securities oversight.

The CFTC is investigating $800 million in suspicious insider oil trading. Nvidia's $90 billion AI deal spree faces regulatory hurdles as the chipmaker would simultaneously act as customer, supplier, and prospective shareholder in some agreements. The SEC is floating reduced disclosure requirements to boost IPOs while also proposing broader changes to company reporting rules. State attorneys general are stepping up merger enforcement, prepared to block or dissolve deals even when federal regulators have signed off.

Where the Work Sits

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The NextEra-Dominion deal alone will generate high-end M&A, energy regulatory, and financing mandates for months. The surge in UK cross-border M&A -- now at $192 billion -- is driving demand for sophisticated transactional teams on both sides of the Atlantic, particularly in corporate governance and antitrust review. The tech IPO pipeline building behind Cerebras, SpaceX, and OpenAI will keep capital markets and securities practices busy through the second half of 2026. OpenAI’s upcoming IPO filing alongside SpaceX and Anthropic, is set to open the liquidity window for mega deals, keeping elite capital markets teams busy.

Private credit work continues expanding at the top end of the market. The Citi-BlackRock HPS program opens a new front for leveraged finance and fund formation teams across European markets. The TCPC federal probe and ongoing redemption shocks are creating billable work for investigations, securities litigation, and fund regulatory practices. The $130 billion CRE distress pile is generating M&A, restructuring, workouts, and foreclosure mandates across New York, LA, and Sunbelt markets.

Nvidia's $90 billion deal portfolio carries antitrust and competition risk across multiple jurisdictions, and its dual role as buyer and supplier will require careful regulatory navigation. The CFTC oil trading investigation, SEC reporting overhauls, and state AG merger enforcement activity are feeding white collar, regulatory, and compliance practices. Sanctions work continues to grow as Hormuz tensions persist and geopolitical alignments shift.

Global Markets

Bond markets are repricing for a world where inflation stays higher for longer, with the Hormuz closure now approaching a tipping point.

The US 30-year Treasury yield climbed to 5.19% -- the highest since 2007 -- as the Strait of Hormuz blockage nears three months. The global bond rout pushed Germany's 30-year bund to 3.68%, the UK gilt above 5.77%, and Japan's 30-year to a record. HSBC warned that even with a swift reopening, the impact on inflation and growth will be lasting, and said a Fed rate hike in 2026 cannot be ruled out. Barclays raised its crude oil estimate to $100 a barrel. US mortgage rates hit a seven-week high at 6.56%.

The UN cut its 2026 global growth forecast to 2.5% from 2.7% and raised inflation projections. UK inflation dropped to 2.8% in April but is expected to climb again as the Iran war lifts fuel costs. Indonesia's central bank delivered a larger-than-expected rate hike, and Iceland also raised rates. On the geopolitical front, Xi Jinping and Putin signed more than 20 trade and technology agreements. The EU reached a provisional deal to implement its US trade agreement, likely avoiding threatened tariff hikes. Trump threatened Iran with a 'big hit' if no deal comes soon.

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 newsletters that highlight the drivers of demand for legal services.