The Perils and Principles of Law Firm Valuation: Lessons from Levine v. Platzer

The Perils and Principles of Law Firm Valuation: Lessons from Levine v. Platzer

An article by attorney Peter J. Sluka of Farrell Fritz, P.C., examines a pivotal New York County Commercial Division decision by Justice Jennifer Schecter (Levine v. Platzer, Swergold, Levine, Goldberg, Katz & Jaslow LLP) that underscores how courts assess law firm valuation disputes after dissolution. 

The case arose when Scott Levine, the firm’s managing partner, dissolved the partnership after failed negotiations for a separation, triggering a dispute over the fair market value of his ownership interest.

Without a written partnership agreement, the partners defaulted to New York’s Partnership Law; however, the court ultimately relied on the firm’s Schedule K-1s, which showed Levine’s 40.362% ownership, as evidence of intent to deviate from equal shares. 

The central valuation conflicts concerned contingency-fee cases, accounts receivable, and the firm’s office lease. Each side’s expert presented starkly different figures, with Levine’s expert valuing his interest at nearly $3 million and the firm’s expert valuing it at zero.

Justice Schecter rejected both extremes, faulting the experts for “overly aggressive positions” and finding that “the truth…is somewhere in the middle.” She accepted that contingency-fee cases had real but limited value, favored the firm’s lower receivables estimate, and agreed with Levine that it was “known or knowable” the lease would be assumed by the successor firm.

For managing partners, Sluka’s analysis offers clear takeaways: credibility matters as much as calculation, and courts view a $0 valuation as inherently suspect. As the decision shows, realism, not rhetoric, is the currency of persuasive law firm valuation.