‘The Firm’ not so firm: It’s breaking up

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The firm is not so firm after all.

Several sources from legal, business and political circles have claimed that the Villaraza Cruz Marcelo & Angangco, or CVC Law office, easily the country’s richest and most powerful law firm, is in turmoil and on the verge of breaking up, with senior partners Avelino “Nonong” Cruz and Simeon Marcelo threatening to leave the 33-year-old law partnership over management and financial differences.

A top government official close to the partners said that 15 partners belonging to the so-called “government bloc” of Cruz and Marcelo were planning to leave CVC Law.  This would leave the rival faction led by chair and CEO F. Arthur “Pancho” Villaraza with only eight partners.

“CVC Law or The Firm has parted ways,” declared the government source, who requested anonymity because he was not authorized to speak in behalf of the law firm.

No comment

Asked for his reactions on the dispute, CVC Law managing partner Bienvenido I. Somera Jr. replied in a text message that he “can’t comment at the moment.”  Several attempts to reach Villaraza through an intermediary also yielded the same result. Marcelo did not return the Inquirer’s calls.

Cruz served as presidential legal counsel and defense secretary during the term of former President Gloria Macapagal-Arroyo, who used to be The Firm’s most powerful client, while Marcelo served as solicitor general and ombudsman during the same administration.

A lawyer and fraternity brother of Villaraza at the University of the Philippines law school’s Sigma Rho fraternity said the partners were bickering on how to divide the profits of the company.

Bigger slice of profits

The lawyer, who requested anonymity, said the group of Cruz and Marcelo had claimed that they had brought in more government clients to the company and therefore deserved a bigger slice of the profits.

The lawyer said The Firm’s top brass held several “ill-tempered” meetings over the past few days, and that their separation was just a formality.  Cruz, he said, had even pushed for the immediate sale of the law firm’s multibillion peso headquarters, the 12-story CVC Law Center at the Fort Bonifacio Global City which was completed three years ago.

An insider from The Firm confirmed that the partners held a “tempestuous” meeting last Wednesday where the seniors partners were supposed to start the separation proceedings.

Purely business vs advocacy

Some partners, however, decided to take a few more days to rethink their stand in the hopes that the two sides would soften their stance and agree to a compromise.

But the insider said that the partners were not squabbling over money because the division of properties would only matter after the partnership had been dissolved.   For the past two years, the insider added, the government bloc had been at odds with the Villaraza group’s policy of treating the partnership as a purely business enterprise.

The government bloc had maintained that The Firm could “still do well and do good” by taking on cases primarily for advocacy rather than just for profit, the inside source said.

Another source however said that The Firm is divided into one faction led by Villaraza and Raoul Angangco, with eight partners on its side, including Somera, who acted as The Firm’s chief operating officer, and often served as a bridge to the rival faction led by Cruz and Marcelo.

 

‘Discontent over treatment’

“Most of the law firm’s partners who had served in government are on [the Cruz-Marcelo] side,” the source said, adding that 15 partners are in this faction.

The source said that the looming dissolution of CVC Law was caused by “discontent” in the Cruz-Marcelo camp over what some partners have described as Villaraza’s “style of treating his other partners.”

Said the source: “The split was caused by fundamental differences in the direction of The Firm and [its] manner of practicing law. The rift has little to do with money matters.”

The source said that the troubles at The Firm and its 23 partners had been brewing for the last few weeks, and that attempts were made to resolve the impasse.  So far, such efforts have failed, the source added.

PR fallout

More recently, both sides have been trying to come to an agreement on how to divide the company, including how to dispose of its headquarters at Bonifacio Global City in Taguig City, while limiting the public relations fallout of the dissolution. But such talks had also failed to break the deadlock.

“It now looks like the breakup would happen soon,” the source said. “This could be fast.”

Rumors of the breakup were fanned by the glaring absence of Cruz, Marcelo and other partners from the “Casa Artusi” series of dinners hosted by The Firm for its blue-chip clients at its ultra-exclusive Rainmakers Lounge at the CVC Law Center’s penthouse.

Guests who asked why only Villaraza and allied partners Augusto A. San Pedro Jr. and Franchette Acosta were around at the event were told that Cruz and Marcelo would be holding separate dinners for their clients.

The Firm was formed in 1980 by Villaraza, Cruz, Tommy Rossel, Romy Barza and current Supreme Court Associate Justice Antonio Carpio.

Falling out with Gloria Arroyo

After its office burned down in 1982, The Firm moved to the LTA Building in Makati owned by the family of former First Gentleman Jose Miguel Arroyo, and stayed there until 2010 even after a falling out with former President Macapagal-Arroyo in 2005 that forced Cruz and Marcelo to quit her administration.

Villaraza and Carpio served as legal counsel for several allies of then President Ferdinand Marcos in the 1980s, but was relatively low-key during the terms of Presidents Corazon Aquino (1986 and 1992) and Joseph Estrada (1998 to 2001).

It was during the term of President Fidel V. Ramos that CVC Law again rose to prominence when Carpio was appointed presidential legal counsel.  The Firm was largely credited with breaking up the decades-old monopoly of Philippine Long Distance Telephone Co. during this period. It was also during this time when CVC Law earned the monicker, The Firm, after a bestseller written by American author John Grisham.

 

Estrada impeachment

The Firm also took part in the impeachment trial of Estrada when Marcelo served as one of the prosecutors.

The law firm’s roster of big-ticket corporate clients include Pilipinas Shell Petroleum Corp., the Rizal Commercial Banking Corp., several companies under the Lopez group, among them ABS-CBN Broadcasting Corp., Sagittarius Mines Inc. and several high-profile individuals.

CVC Law served as the external counsel of the Bangko Sentral ng Pilipinas in its latest round of legal battles with the shuttered Banco Filipino Savings and Mortgage Bank. It was also part of the successful operation to shut down the P14-billion Legacy scam in 2009.

Last year, The Firm served as advisers during the impeachment trial of former Chief Justice Renato Corona.  With a report from Daxim L. Lucas

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Disclaimer: The comments uploaded on this site do not necessarily represent or reflect the views of management and owner of INQUIRER.net. We reserve the right to exclude comments that we deem to be inconsistent with our editorial standards.

  • regie

    di po ba ang legal profession is not a trade or a craft but a profession?

    • Horst Manure

      Yes professional parasites.

  • NAGMAMARUNONG

    SORI NA LANG!!! GANYAN TALAGA ‘PAG WALANG BIGAYAN.

  • http://twitter.com/Negastarr NegaStarr

    So saang faction si Justice?

    • kismaytami

      Siyempre, sa may mas malaking taya. LOL!

      • http://twitter.com/Negastarr NegaStarr

        Sgma rho vs sigma rho. This is fun.

  • Horst Manure

    Checked the barrel found out no pork left….like all judicial connection just as effective as a chocolate teapot, sounds like the whole organization ran on government contacts so one can only imagine what went on behind the doors.

    • buttones

      Yes indeed, that’s probably what’s happened, the bottle’s empty, there’s nothing left, ‘let’s split up and find new watering holes to feed at- there is a fool born every minute that need our services”….

  • tongky80

    its not about the money, its the sharing!

  • kilabot

    in a partnership of crooks,
    someone wants to lord it over the others,
    and wants more of the loot for himself,
    as if his stomach is much bigger than the others.

  • parefrank

    Let them crash. They have meddled in so many political matters that they have been already a second executive branch. And usually always with the administration in power so that hardly anyone has a chance against them, no matter being right or wrong.

  • Albert Einstien

    it’s LAW of the JUNGLE….and law firms are lions, they are NO EXCEPTION…in fact ..there is a concept.. .” MONEY is my COUNTRY, MONEY is my GOD… “- by filthy rich TRAITORS…

  • ApoNiLolo

    As usual, like all business partnership, it all comes down to MONEY! >: D

  • http://www.pulisnapogi.blogspot.com/ Pulis Na Pogi

    kill all lawyers…

    only then this country can rise again…

  • kabayandinako

    Sa isang hearing sa korte, may witness na pulis na tinatanong ng kalabang abogado:
    Abogado: Kung may tiwala ka sa mga kasamahan mong pulis, bakit naka susi ang locker mo sa presinto?
    Pulis: Kasi po yung presinto, nasa building nitong korte, at paminsan-minsan po may pumapasok na mga abogado.

    • D3marketers

      Nyahahaha ayos!

  • http://www.facebook.com/ernesto.y.tolentino Ernesto Y. Tolentino

    Correction, please. Ruby Tiong-Tan, then chief of Express Telecommunication (Extelcom), was mainly responsible, with the assistance of the law firm of Felipe Gozon, for breaking up the monopolistic hold of PLDT on the local telecom industry

  • gerp

    is this a news???… if this lawyers do their part to make our country become a strong nation, pwede siguro…pero kung kasama sila sa corruption and tinutuwid ang mali ng mga kurakot na official ng gobyerno…dapat di na sinusulat ito..ganito na ba ang PDI ngayon?

    • $33680178

      @gerp unfortunately, a lot of “news” get written through the initiative of interested parties. that is how things have always been. it will take a long time before things change.

  • Love God

    Any empire that built by evil means must come down some day. That is the law of God. Likewise The Firm was very notorious during the term of the past admin.

  • tarikan

    Mr. Gil Cabacungan, sir. With due respect, I think it is “on behalf” not “in behalf”. I find this phrase ‘in behalf’ only in the Philippine print media. Outside of the Philippines it is “on behalf”. “In behalf” I think for most people is passe’.

    • Filpino

      “in behalf” or “on behalf” it does not matter, as long you understand the context in a filipino way. Kaya nga magtagalugan nalang tayo ng magkaintidihan agad.

      • tarikan

        No, no my friend please don’t get me wrong. Mr. Cabacungan was writing in the English language, it won’t hurt that much if he followed the correct way not the “other way”. Journalists are very good role models especially in written English. If he was grammar deficient in English, what good would he bring to the reading public?

    • jus_sayinagain

      Both expressions are commonly used anywhere English is properly spoken and written….and they mean slightly different things.

      “In behalf of” means “for the benefit of” or “in the interest of.”

      “On behalf of” means “in place of” or “as the agent of.”

      Example:

      “On behalf of” my parents, I am donating a million pesos to be used “in behalf of” tree restoration in the park.

      In the case of the writer, you can be the judge. The anonymous gov’t source was not authorized to speak “as an agent of” the firm. You are correct in that regard!

  • JuanTamadachi

    The firm got too big for it’s britches, hence the inevitable split.

  • disqus_WIkXYUshrh

    The Firm is no longer firm but loosely operating with depleted clients because they can not penetrate deeply in Noynoy’s administration.

    Ang dami pang storyang gustong palabasin. Don’t break up the Firm and may be just wait for Nognog or Bong bong to win the 2016 presidential tourney.

    But if you think Mar Roxas will win with Bam or Kris Aquino as VP in 2016, then it is better to consider closing the loose Firm. NOW NA.

  • disqus_WIkXYUshrh

    Better consult Mr. Lauro Vizconde on what to do with your now loose Firm

  • wawa2172

    The Firm became influential during The Pandak admin and still is with PNoy admin. They have captured meaty projects and have milked the government with their high paying services including the Corona impeachment trial and of course representing the government in cases against The Pandak. Pera at hatian sa kita ang pinag aawayan sa The Firm. Cruz and Marcelo have grabbed a lots of project with the current government that would enable them to stage a coup to break up The Firm. Well sana malusaw na ito pati na ang mga lawyers na nag papasasa sa pera nang bayan.

  • http://www.facebook.com/iyen.dev Iyen Dev

    The main issue here is credibility. CVC will never be remembered, their faces will be erased, names of partners will be forgotten.The best way for them is to kill themselves too!The tower of Babel is crashing down…turn them into ashholes!

  • Pablo Juan

    I’m surprised they didnt hire the fortunes and topaksyo.

  • Ben Smith

    Crocodiles and sharks in designer suits.

  • penoy2012

    malakanyang’s hands are full of dirt in this mess.

  • RealChangePH

    Some of the comments here are truly hilarious. I cannot believe that people are sooo naive that they actually believe all the nonsense that the firm “cannot penetrate” the Aquino administration and all that nonsense.

    The Aquino administration is just as corrupt as the Arroyo administration. And all the usual names like the firm are still so deeply mired in government, that the pay-off is probably likely much bigger now.

    I’m sick and tired of all these paid “daan na matuwid” hacks spreading their nonsense all over the internet.

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