The boutique boomlet

John DeQ Briggs' decision to leave the 700-plus-attorney law firm Howrey LLP, where he chaired the antitrust practice, for boutique firm Axinn, Veltrop & Harkrider LLP is worth noting for two reasons: It highlights the strength of small, specialty firms in an otherwise "bloody" legal environment; and it comes as dealmakers prepare for a new era of antitrust enforcement.

On the first point, layoffs at large firms are coming almost as fast as cuts on Wall Street. As demand for services dries up, and facing pressure from clients to cut costs, big firms including Cadwalader, Wickersham & Taft LLP; Cooley Godward Kronish LLP; Orrick, Herrington & Sutcliffe LLP; and dozens of others are aggressively downsizing.

With less overhead, lower rates and more focused practice areas, boutique firms are better positioned to weather the downturn, says Briggs, and some are even seeing their practices grow. "Smaller firms are more nimble," says Briggs. "They're not battleships. They're destroyers." For obvious reasons, boutiques specializing in bankruptcy, restructuring and antitrust are in great demand. That includes Axinn Veltrop, where as a managing partner, Briggs will team up with partner John Harkrider to recruit talent and build up the firm's antitrust and regulatory practice in the nation's capital.

Which brings us to the second point. It's well known that President Barack Obama plans stepped-up antitrust enforcement. He's mentioned it on numerous occasions. But Briggs, who previously chaired the American Bar Association's Section of Antitrust Law, says to expect not only more enforcement from the new administration but also a shift in how deals are reviewed.

"For the past 25 years, the areas of inquiry were around products and pricing. In that environment, gaining efficiencies was a good thing," says Briggs. "Antitrust was indifferent to the state of the economy or tax receipts or the unemployment numbers."

Not anymore, says Briggs. With unemployment edging toward 8%, the social implications of a merger will also be a consideration under an Obama administration, particularly when both buyer and seller are distressed. To illustrate, Briggs uses the hypothetical case of competing but struggling auto suppliers. Alone, each company might limp along for a couple of years by cutting 1,000 jobs. By merging, the new organization would cut only 700 jobs and be better positioned for long-term survival.

"Today, because of the jobs it would save," says Briggs, "that deal might have a chance of getting approved."