New Partner Announcements: What Do They Say About the Health of Law Firms?

‘Tis the season — not just for getting your holiday shopping started, but for many law firms to announce their new partners. Earlier this month, we commented on the announcement by Wachtell Lipton of six new partners. Given the firm’s relatively small size, six is a robust number, suggesting that all is well at WLRK despite the downturn.

Partnership announcements can shed light upon the financial health and practice-group priorities of law firms. Many firms like to say that they pick partners based solely on the talents of the lawyers in question, independent of such factors as the economy. Then again, many firms also like to say that dismissals of lawyers are strictly “performance-based.”

In our Wachtell post, we invited you to share your firm’s new-partner news with us (by email). A few of you did. E.g., Cleary Gottlieb (eight new partners); Cravath (three new partners).

Some tipsters were even more helpful, offering analysis of what the partnership news says about the firm. For example:

Not sure if you’re are keeping track of how many partners firms are making, or if it’s even a good metric, but Ropes & Gray made 12 new partners, several in corporate and private equity — the press release is on their website. Also, their start date [as partners] has been confirmed and is not pushed back. Thanks for all the good work.

So it sounds like Ropes Gray is faring relatively well. But then again, we already knew that.

A dissection of the Wilson Sonsini partnership announcement, after the jump.

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After reviewing the partnership announcement of Wilson Sonsini, a tipster had this take:

* “[T]his class clearly reflects the difficult economic times — it’s the smallest class in four years. This class also reflects the large number of lateral partners hired in the last year and a lower amount of partner attrition. In recent years, there has been a strong relationship between partner attrition and the number of new partners. There were fewer slots available and more of them were taken by laterals.

* “[T]he primacy of the corporate practice has been firmly reestablished. The litigators for years complained about second-class status and it was harder for litigators to make partner. Several years ago, the litigators were able to reach parity in the number of new partners and were able to maintain parity for a couple of years. Since then, however, the litigation practice has declined along with the number of securities class actions. This partnership class reflects the return to the old system, with four new corporate partners and one new litigation partner.”

* “[N]ew partner classes often offer insights into a firm’s strategy. Many years ago, it was pretty unusual for WSGR to promote any IP licensing lawyers to the partnership. In recent years, this has become more common…. Similarly, it is much more common in recent years for employee benefits lawyers to be promoted than in the past. Conversely, there are far fewer litigators being promoted.”

* “Reading between the lines, it seems clear that, as before, WSGR expects the corporate practice to lead the way. However, it appears WSGR now sees licensing as a leading practice rather than as the support group it was previously. It also appears litigation is declining in relative

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importance.”

If your firm recently announced new partners, and you’d like to parse the announcement for us, please email us (subject line: “New Partners”). Thanks.

Cleary Names New Partners and Counsel [DealBook / New York Times]

Cravath, Swaine & Moore LLP Announces Three Elected to Partner – Legal Announcements [LawFuel]

Ropes & Gray elevates 12 to partnership [Ropes & Gray]

WSGR Names Eight New Partners [Wilson Sonsini Goodrich & Rosati]

Earlier: Who wants to be a millionaire? Meet Wachtell’s new partners.