Thelen has officially announced they will dissolve.
According to the release, Thelen:
[B]reached a partner departure covenant that restricts the number of partners who may depart the firm within any twelve month period.
In other words, the bank pulled Thelen’s line of credit, much like they said was not going to happen.
Most disturbingly, Thelen apparently does not think it is obligated under federal regulations:
Although not necessarily required, Thelen is seeking to pay its employees 60 days salary under federal and state WARN Acts. The firm is also seeking to pay all accrued vacation pay. The response to date from the bank is that it will fund employee salary through Nov. 30, but will not pay accrued vacation pay. Both of these issues are still under discussion.
We’ll see how that flies in court, which is undoubtedly where this will end up.
After yesterday’s news that Thelen Chairman Stephen O’Neal was in talks to move to Howrey, the Thelen partnership met today.
That meeting is still ongoing, but early reports are that a partnership committee recommended dissolution to the full partnership.
The firm has been maintaining that they had a plan that would avoid dissolution ever since their proposed merger with Nixon Peabody fell through.
Update (5:05): As we understand it, Thelen has two different options from this point.
Option 1 is the plan they have arguably been pursuing: breaking up the firm practice group by practice group to interested parties. As we reported yesterday, this is the best option to save associate jobs. However, that plan is dependent on Thelen’s banks signing-off on the plan and maintaining their line of credit. Did Stephen O’Neal’s aggressive and ultimately public pursuit of his own lifeboat at Howrey scuttle that option? Once everybody is told that the managing partner could be leaving in ten days, why would other potential suitors compete for full Thelen practice groups? Instead, it’s easier to wait for an official dissolution and cherry-pick the rainmakers. This is what happened to Heller.
Option 2 is essentially what happened to Heller. If the full partnership accepts the recommendation and dissolves, this would likely trigger the WARN Act. As we know from the Heller situation, employees are entitled to 60 days notice. Many people predicted that Thelen would move to dissolve this week, last week one tipster told us that Thelen wanted to wrap up their operations before the end of the year. If true, that all but necessitates an official dissolution announcement this week. But, as Heller teaches us, just because you get 60-days warning doesn’t mean you get 60-days pay. We know that various Thelen associates were told that this type of dissolution was not going to happen. But … it appears to be happening.
With all the attention focused on the 2009 summer class, and current associates getting laid-off, and full service law firms dissolving, we’ve kind of lost sight of the 2008 summer class. Many of them have still not made a decision about their future employment.
We’ve received reports from multiple tipsters that say Locke Lord’s Houston office made offers to less than 50% of their summer class:
I thought you should know that [Redacted] Locke Lorde in Houston, TX only extended offers to 14/30 of their 2L summer associates – including no-offers to some who had spent their 1L summer with them.
As we understand it, 27 of those summers were 2Ls.
Apparently the relationship between Locke Lord and their 2008 summers was one of mutual unhappiness. We’ve been told that of the 14 offers, only four have been accepted at this point.
You’d expect a little better than 4 out of 14 in this market.
A “profile” of one of the summers that did receive an offer after the jump.
This is not the best time to be losing Bankruptcy rainmakers. But according to the ABA Journal, that is exactly what is happening to Kramer Levin Naftalis & Frankel. The three partners are: David Feldman, Eric Wise and Matthew Williams. David Feldman was formerly the co-chair of Kramer Levin’s bankruptcy group.
Gibson Dunn’s press release heralding the new hires reinforced the trio’s rainmaking capacity:
“This group has an established practice and a tremendous reputation in the distressed debt arena and will give Gibson Dunn a strong foundation in this growing area,” said Michael Rosenthal, Co-Chair of the Business Restructuring and Reorganization Practice Group.
Update (3:51): As many commenters pointed out, bankruptcy superstar Luc Despins is leaving Milbank for Paul Hastings. According to the National Law Journal:
Luc A. Despins, well-known in the profession for his representation of the creditors’ committee in the bankruptcy of Enron Corp., is the latest marquee name to be poached as firms rush to ramp up restructuring practices in response to the worsening economy.
According to our sources at Milbank, no associates will be leaving with Despins. The firm could not be reached for immediate comment.
Bankruptcy lawyers are the new IP attorneys. They’re very much in demand.
We previously discussed Maryland’s Halloween sex offender ordinance, which requires convicted sex offenders to turn off their lights and display the sign (shown to the right) warning children to stay away on Halloween.
Missouri has a similar law. They require sex offenders stay inside between 5 and 10:30 p.m., prohibits them from participating in Halloween related activities, and wants them to turn down the lights and post a “no candy here” sign.
According the WSJ Law blog, District Judge Carol Jackson struck down parts of the law yesterday. In particular, the judge was concerned with the vagueness of the law:
Apparently, Judge Jackson was concerned that in some cases, parents could be punished for Halloween activities with their own children, such as “carving a pumpkin in the privacy of your kitchen with your 5-year-old child.” She questioned whether such parents might have to send their kids away on Halloween to avoid prosecution. “It’s not too much to expect criminal laws to be clear,” she said.
The judge did not note what many of our commenters already have: telling sex offenders to turn down the lights is a terrible idea.
Seriously, the whole thought process behind trampling civil liberties requiring these extra regulations for convicted sex offenders is the fear about sex offender recidivism. If we are truly worried that sex offenders are ticking time bombs waiting to explode all over little children, shouldn’t their houses remain well-lit at all times?
Also, why should sex offenders be forced to stay home on Halloween? It seems like a great time for them to fulfill their Megan’s Law requirements, just like Will Forte suggested.
A firm-wide memo from Charlie O’Neil, managing partner of Chadbourne & Parke, announced that the firm was instituting a legal and non-legal hiring freeze in response to the economic downturn.
The lengths O’Neil went to try and bury this important piece of firm information are slightly amazing. The firm-wide email was entitled “How Are We Doing?” and the first 4 paragraphs read like the “Yay Us” emails we’ve seen from firms like DPW and STB.
However, in the sixth paragraph, O’Neil gets to the part where he talks about keeping control over firm expenses:
That said, expenses have been under constant review and we have taken a number of steps to better position us for the remainder of this year and next. Among the more significant is the decision to delay much of the planned technology upgrade. We recognize the need to improve technology and certain of the more important upgrades will continue. Others, including the upgrade to new desktop computers and software, will be postponed. We will review this decision in 2009 as the economic picture becomes clearer. Should conditions improve we will begin the upgrade sometime in 2009; otherwise it will be delayed until 2010. We will be issuing new guidelines pertaining to controls over Firm business expenses, including travel. We will also more closely monitor and limit certain other expenses which in a more robust economy might otherwise be acceptable We have also instituted a freeze on hiring legal and non-legal personnel. To the extent a practice area has need of additional legal personnel, we will seek to temporarily shift lawyers from a less-busy practice area to assist, rather than hiring laterally. We will take the same approach with non-legal personnel and departments. We welcome your thoughts on other cost saving measures.
Catch that? I bet O’Neil hopes you didn’t.
More after the jump, including the full Chadbourne memo and the firm’s response.
A piece of general advice for judges, lawyers, presidential candidates, and almost everyone else: avoid using the terms “you people” and “that one.” They tend to raise hackles. And get you removed from the bench.
The North Carolina Supreme Court removed Judge Mark H. Badgett from the bench after he ordered a Hispanic man accused of domestic violence to pay child support when none was requested, saying “you people always find a way,” and, “I don’t know how you treat women in Mexico, but here you don’t treat them that way.”
After defendant Floyd Mandez Carreon objected, Badgett ordered a deputy clerk to take Carreon’s wallet from his pocket, hand over $140 in cash to Kathy Mendez Carreon, and let her take down Floyd’s Social Security number.
Ordering a deputy clerk to rob a defendant isn’t kosher? Another “whoops” moment after the jump.
When Harvard law school announced that they would be dropping their letter-grading system in favor of a pass/fail system, we noted that the school had not yet decided how to apply the new system to current law students:
But the crucial question is whether this new system will be applied retroactively to the classes of 2009 and 2010.
Well, today Harvard decided. After discussing the pros and cons of applying the new system to current 2Ls, Dean Elena Kagan announced:
In light of these strong arguments on both sides of the question, the School will adopt something of a middle course, suggested by a number of second-year students. (I should note that second-year students offered several other creative approaches to the issue, and we seriously considered all of them.) In 2008-09, members of this class will continue to receive traditional grades. In 2009-10, members of the class will receive grades under the new grading system, with the result that the entire school in that year will operate on this new system. Graduating honors will continue much as now, based on performance from all three years. This approach will allow students in the position I have described above to show the kind of improvement in their academic records most easily recognized by judges and other employers (because based on the same metric). At the same time, it will enable the entire Law School, including members of the class of 2010, to participate in, and gain the educational benefits of, the new system beginning next year. I understand that some may view this solution as akin to cutting the baby in half, and it will disappoint some students on both sides. But it seems to me to respond appropriately to the most powerful concerns on either side and thus to represent a judicious, even if by no means perfect, resolution of the issue.
This is a big difference from what Stanford instituted this September. Remember, SLS decided to retroactively apply their modified pass/fail system to the 1L grades of current 2Ls.
Harvard’s balancing act is designed to give 2Ls the best chance at getting jobs and clerkships in this tough market. But transcripts of 2010 law school graduates will still look … a bit weird. At least 2010 SLS transcripts will all be on the same system, somehow.
Which do you prefer?
Read Kagan’s full memo, including her discussion about what happens to 3Ls and LLMs, after the jump.
A year ago tomorrow (Wednesday), Cravath kicked off the 2007 bonus season by announcing bonuses which ranged from $35K to $60K and “special” bonuses that ranged between $10K and $50K.
Don’t expect Cravath to come out of the gate early this year. We asked Cravath whether they would be bonus leaders this year, but they declined to comment, citing their longstanding policy of not talking about associate compensation issues.
But remember how surprisingly early last year’s bonus announcement was for Cravath. In 2007 they announced on October 29th, but in 2006 they didn’t announce until December 11th. In ’06, Milbank came out with the first bonus announcement, but they waited until December 8th to announce.
From what we are hearing, bonus announcements could come even later in 2008 than they did in 2006. Sources are telling us that their firms are trying to wait until the last possible minute to announce bonuses. Managing partners are still trying to lock down their fee collections, which are lagging given the economic difficulties.
In addition, some firms are still trying to figure out which clients will exist going forward.
With all the uncertainty, late bonus announcements seem likely.
* A Guantanamo prisoner and his attorney are boycotting their own trial. They have to be in court, but they aren’t saying a word. It was not the best strategy for voir dire. [Associated Press]
* Musical chairs: Colorado Assistant U.S. Attorney Haley Reynolds to head to Iraq. [Denver Post]
* Edward “frying pan” Halverson pleaded guilty to beating his ATL Judge of the Day Hall of Famer wife, and will spend the next 3 to 10 years in prison. Apparently, the fight was a result of delayed dinner plans. [Las Vegas Review-Journal]
* Auditors prepare to be sued. They are “classic litigation targets when finances go awry, and the swift collapse of seemingly sound financial institutions is expected to clog the courts for years to come.” [Compliance Week]
* If the Phillies end up blowing this thing, beleaguered Philadelphia sports fans will have an excellent cause of action for secession. [ESPN]
Jiminy jillickers! ATL editors are going all over the place over the next month or so. Or at least all over the Eastern Seaboard. If we aren’t heading to your neck of the woods on these trips, never fear, we may hit you up on the next time around. We’ve already hit up Houston, Chicago, Seattle, San Francisco, and Los Angeles in the past year.
Kinney Recruiting’sEvan Jowers is currently in Hong Kong for client meetings and still has a few slots available through October 22. Evan will also be in Hong Kong November 14 to December 15. Further, Robert Kinney has been in Frankfurt and Munich this week and is available for meetings with our Germany based readers.
One of our key law firm clients has referred us to one of their important clients in the US, Europe and China – a leading global technology supplier for the auto industry – in order to handle their search for a new Asia General Counsel and Asia Chief Compliance Officer.
Kinney is exclusively handling this in-house search.
This position will have a lot of responsibility and include supervision of eight attorneys underneath them in the Asia in-house team. The new hire will report directly to the global general counsel and global chief compliance officer, who is based in the US. The new hire’s ability to make judgement calls is going to be as important as their technical skill set background.
The position is based in Shanghai and will deal with the company’s operations all over Asia and also in India, including frequent acquisitions in the region.
It is expected that the new hire will come from a top US firm’s Shanghai, Beijing or Hong Kong offices, currently in a top flight corporate practice at the senior associate, counsel or partner level. Of course, the candidate can be currently in a relevant in-house role.
The JOBS Act created new tools for companies to publicly advertise securities deals online. As a result, thousands of new deals have hit the market and hundreds of millions in capital has been raised, spurring a wealth of new business development opportunities for attorneys.
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The Jumpstart Our Business Startups Act (JOBS Act) went into effect in 2013 and permits Regulation D offerings of securities to be advertised publicly. This means that funds and companies can now use social media, emails and web sites to market transactions to new “accredited” investors.
However, with these new powers come new pain points. InvestorID FirmTM provides a secure, fully hosted, cloud-based platform with a breadth of tools for your clients, including: