We’ve finally finished reading the full American Lawyer article (subscription) about the internal machinations at Cadwalader, Wickersham & Taft. With great access to firm chair Chris White, Nate Raymond weaves together a brilliant tale of greed, homogenization, and the differences between running a law firm and running a business.
We encourage you to read the full article. For those busy trying to hang onto their jobs, we’ll give you a few excerpts.
One thing is very clear: the partners over there are totally screwed too, at least as much as you can be “screwed” while making millions of dollars a year:
At Cadwalader, the push for profits is relentless. The average Cadwalader partner brings in around $5 million in revenue, and has to worry all the time about maintaining those numbers. “We expect people to produce,” Link says, unapologetically. “Cadwalader is a meritocracy.” High performers are rewarded with shares and bonuses-at the expense of those farther down the food chain.
Talk about a pie eating contest where the prize is more pie.
As we reported yesterday, there is just no way of knowing right now if the defection of Andrew Perel is an outlier or a precursor. Yet White talks about his departed partners in language usually reserved for junior associates:
White contends that many of the partners who leave are people who couldn’t keep up. “In some respects, peer pressure doesn’t go away [when you're a partner],” he says. “When you’re in an environment where everyone is performing at a very high level, and you’re accustomed to performing at that level, it becomes difficult when you’re not performing at that level.”
More about the new (!) Cadwalader business plan, after the jump.
Only now does Cadwalader seem to have the institutional drive to truly diversify their practice:
Cadwalader’s pure-play strategy is in tatters. The firm is shifting focus, speeding up a diversification effort it had previously felt no urgency to complete. White, as chairman, is counting on recent lateral acquisitions, especially R. Ronald Hopkinson, who was lured from Latham & Watkins to launch a private equity practice from scratch.
Putting it all together, once again we see that getting laid off rarely has anything to do with the individual attorney. Cadwalader’s die was cast years ago, with Project Rightsize, and the 96 associate causalities in July were simply in the way when the wheel came ’round.
Next time, it might be partners and decision makers who are out on the street.
But the big question that has yet to be answered is whether anybody will learn anything from the Cadwalader experience. White says that Cadwalader is “prudent” in managing risks. Come again?
If other firms have been as prudent as Cadwalader, the worst is yet to come.
After the Fall [American Lawyer]
Does the Future Belong to Cadwalader? [New York Law Journal]
Earlier: Prior ATL coverage on Cadwalader