The reason for why the firm went bankrupt is that it switched from being a partnership to being an LLC. Partnerships don’t go bankrupt except under extreme circumstances. When a partnership’s profits decrease, the payouts to partners simply go down proportionately. And partners will do anything possible to avoid a bankruptcy because they are personally liable.
Dewey & LeBoeuf changed to an LLC so that they could pay massive salaries to chosen shareholder/employees using borrowed money. The result is that those shareholder/employees walk away rich (although without a guaranteed future source of more millions unless they can get hired at a high-level position with another law firm, which might happen or might not), and creditors get left unpaid. It also sucks for the junior employees.
Did it really benefit society to change the rules to allow law firms to become LLCs? I don’t think so. Law firms don’t need access to capital in order to invest in anything value-creating such as R&D or building new factories. They just use the money for zero-sum or even negative-sum competition purposes involving poaching rainmakers from other firms.