The Merger of 2006 Undone in 2007

I got the news on my BlackBerry early this afternoon, but it's all over the place now (WSJ, American Lawyer, Bloomberg [where yours truly is quoted]):  The Dewey-Orrick merger is not to be.

I'm sorry. 

I felt from the beginning it held great promise, and could overturn the received wisdom that elite New York City firms never merge.   I still believe the ice may have been broken on that particular conceit, and if so it's excellent long-run news, if disquieting short-run news, to precisely those New York elites.   Another way of saying this is that as supremely lucrative as being at the top of the legal food chain on this miraculous island is, the world changes and the supremacy of the incumbents is always earned every year, not guaranteed as if by primogeniture.

Without any actual information about what went wrong, I have only a few general observations about the merger cancellation:

• It's a truism that the longer consummation of "the deal" takes, the more likely it is that people begin to get seriously cold feet.
• We are about as far removed from a command-and-control, hierarchical managerial model as could be imagined, and if leaders of a firm say, "March," the response will be "Why?" rather than "Yes, sir."  This ties back into the point above.
• The "material exodus" of partners from Dewey that I'm quoted on in the Bloomberg story was bad news for Orrick and bad news for Dewey:  For Orrick, obviously, because they would get less firepower than they hoped to; but equally so for Dewey whose partners might begin to conclude that the maybe/maybe-not status of the deal, with its concomitant talent erosion, might be too high a price to pay.

Will this, then, be taken as a cautionary tale that we as a profession and an industry should dial back on aspirations for ambitious combinations? 

I could be wrong, but my money at the moment is on, "Not on your life."