I’ve been trying to be optimistic about the future of Biglaw in 2010. There’s no harm in hoping for the best.
But I’m positive that 2010 will see more outsourcing of American and British legal jobs to India. And from the perspective of junior Biglaw associates or current law students, that trend does not lead them to a good place.
The Times of London (gavel bang: Am Law Daily) has an excellent expose on Pangea3, an Indian company doing work that used to be done by junior attorneys in the U.K. Once again, we see that law firm managers — and their clients — have compelling cost reasons to ship legal work overseas:
Much of the work that Pangea3 and similar firms deal with, such as drafting derivatives contracts or conducting due diligence for mergers and acquisitions, was once the preserve of trainees and associates at big City law firms. Some of those firms racked up annual revenues of more than £1 billion during the boom years, in part by billing out teams of junior lawyers for up to £300 an hour for even the most routine tasks. …
Whereas a new recruit at a “magic circle” firm in London can expect a starting salary of about £60,000 — rising to more than £90,000 at the best paid firms — Pangea3 can pay a good Indian law graduate as little as £350,000 rupees (£4,700) a year.
Those are powerful numbers. And apparently it’s not even all that hard to start one of these companies.
Details after the jump.
Ed. note: ATL has teamed up with the 10th Justice to predict how the Supreme Court may decide upcoming cases. CNN has called FantasySCOTUS the “hottest new fantasy-league game.”
Welcome to the sixth installment of Predictions of the 10th Justice, brought to you by FantasySCOTUS.net. The league has over 3,400 members, who have made predictions on all cases currently pending before the Supreme Court.
By conducting a rigorous statistical analysis of 26 of the most hotly contested cases this Term, we have developed a descriptive model to elucidate how frequently a Justice will vote in the majority, and how this affects the building of majority coalitions on the Court. Additionally, these statistics paint a picture of how Justice Sotomayor, the newest addition to the Court, will vote, and which coalitions she will join. Finally, this analysis aims to answer the elusive question of how often Justice Kennedy will be in the majority.
Great news for Biglaw partners and the associates who love them. Early returns suggest that despite the global economic meltdown that wrecked multiple American industries, profits per partner remained relatively stable in 2009.
Biglaw partners made out okay. They survived. And they’re looking forward to even more profit in 2010. The WSJ Law Blog reports:
Here’s one thing that’s not in dispute: 2009 was awful for firms. A survey by Citi Private Bank’s Law Firm Group of 50 of the country’s 100 largest firms, as measured by revenue, found last year’s revenue at the firms was down an average 4% from 2008. These same firms, according to Citi, averaged 7% revenue growth in 2008, and 12% growth from 2001 to 2007. And the profit picture would have been worse had firms not aggressively cut expenses, by an average of 7% in 2009, says Dan DiPietro, the Citi’s Law Firm Group advisory head.
I think a four percent haircut, in the middle of the worst recession anybody can remember, is actually strikingly good for Biglaw partners. A lot of associates saw salary cuts of 10% or greater — to say nothing of all the people who saw salary cuts of 100%, i.e., who lost their jobs. Relatively speaking, I think a four percent drop in revenue — with the possibility that PPP won’t even fall by that much — is good news.
Of course, some firms beat the curve….
If you are a federal law clerk, now is the time to start thinking about your next career move. Law firm positions for clerks finishing up in fall 2010 are filling up fast, and if you are among this group, this Job of the Week is for you. Position: Litigation Associate Location: New York, DC, LA or Chicago Bonus: These positions qualify for Lateral Link’s $10,000 placement bonus. Description: Several top firms (including prominent national firms and several NY boutiques) have engaged Lateral Link to identify judicial clerks to join their associate ranks. Clerks should have previous big firm experience and be coming from a federal clerkship. Outstanding academic credentials.
If you are currently clerking, please sign up for Lateral Link at www.laterallink.com, and a Lateral Link search consultant will contact you about these positions. If you are currently a Lateral Link member, please view Position #5808 and request to be contacted by your personal search consultant. Earlier:Prior Job of the Week listings
Given the current uncertainty in the economy and financial markets, and the impact on law firms, we are still in the process of evaluating associate salary levels for 2009. We expect to make a decision on this issue sometime during the first quarter of next year.
Well, here we are, in the first quarter of 2010, and Sidley’s associate salaries remain frozen in place.
But maybe that is about to change? Multiple tipsters report that Sidley is holding an all-associates town hall today. The scuttlebutt is that associate salaries are on the docket, and the firm-wide memo announcing the meeting also specifically states that salaries will be discussed:
You are invited to attend a meeting on Friday, January 15, 2010 at 2:00 pm EST to report on year-end results, U.S. associate salaries, and other matters.
Could this be good news? Sidley has done it before. Despite laying off 229 people back in March, Sidley hasn’t been the kind of shop where morale goes to die during the recession.
But our tipsters expect the worst. Details after the jump.
Ed. note: Above the Law is a bit estrogen-deprived this week, with both Kash and Marin on vacation. So your above-signed writer, who is more in touch with his feminine side than Elie, was called up for duty. He apologizes for not being able to do justice to this subject. UPDATE (6 PM): The New York State Bar Association has changed the title and description of the panel in question. Details after the jump.
Women in the law: you’ve come a long way, babies. Many of you are partners, even managing partners, at top law firms. Some of you are professors, even deans, at leading law schools. One if you is the Solicitrix General; two of you sit on the Supreme Court.
But maybe you still need some advice for navigating the mean, cutthroat, male-dominated world of the legal profession. Ideally these tips should come from, you know…. MEN.
At the upcoming annual meeting of the New York State Bar Association, the Committee on Women in the Law is sponsoring a program called “Weathering Tough Times: Strategic Planning for Your Practice.” It includes this panel:
So, how do you think women lawyers reacted to the prospect of enlightenment from a “distinguished panel of gentlemen”?
So the firm has returned to the old fail-safe option: layoffs. Am Law Daily reports that the firm laid off approximately 20 attorneys and 20 staffers.
The firm-wide email from Seyfarth Shaw describes the layoffs as needed to better position the firm to take advantage of “opportunities” in the market:
We see opportunities for creating or strengthening client relationships in all of our departments; however, we also know that we must approach these opportunities with the most effective use of our people and their skills.
As a result, we implemented today a separation of approximately 20 attorneys and approximately 20 staff members from a total of about 1,500 people nationwide. In some cases, these decisions were made to better match current or anticipated workloads; others were made as a result of our annual performance management process for attorneys. The separations were spread across multiple offices and practice groups. We have talked to each person affected prior to the distribution of this e-mail.
One Seyfarth Shaw tipster who still has a job told us that they preferred layoffs of some people over additional salary cuts for everybody.
Clearly, we’ve moved well beyond the “survivor’s guilt” stage of Biglaw layoffs. At this point, people are just trying to hang on.
Read the full Seyfarth layoff memo, after the jump.
On Wednesday, we commended the firm of Paul Hastings for moving so quickly to support Haiti earthquake relief efforts. Since then, a number of other top law firms have pledged their support to this worthy cause.
(Okay, Rush Limbaugh questions the worthiness of the cause. But we suspect that Limbaugh’s position — like that of Pat Robertson, who blames the earthquake on Haiti’s supposed pact with the devil — is a minority view.)
The WSJ Law Blog and Am Law Daily have gathered information about what various law firms are doing to help Haiti. We’ve combined their reports with information we’ve received from our own sources, to create a more comprehensive list.
Check it out, after the jump.
* First, Dominic Carter lost his job as political anchor for New York 1. Now, he’s been sentenced to one month in jail. The lesson: don’t beat your wife. [Daily News]
* Gilbert Arenas, the Washington Wizards guard, has been charged with felony gun possession. [Washington Post]
* In other basketball-related legal news, Shaquille O’Neal wants people to stop appropriating one of his nicknames, The Big Shaqtus. [Courthouse News Service]
* Debt collection law firm closes. Aww. So sad. [ABA Journal]
* Law firm salaries are in retreat. I-banker salaries? Not so much. [Washington Business Journal]
* So it kind of makes sense that law firms plan to raise rates in 2010. [Law.com]
We have previously predicted that, when the American Lawyer releases its data on profits per partner in 2009, we’ll see some declines over 2008. Last year was not a pretty one for the profession (although most of you think this year will be better).
But could our prediction be wrong? Is it possible that, owing to various cost-cutting measures — including, but not limited to, lawyer and staff layoffs — some firms will report significant increases in profit per partner in 2009?
Quite possibly. Take the case of Locke Lord. The Executive Committee recently informed the LLBL partnership as follows:
The Firm ended 2009 with Net Income of $171.9 million. This total represents a $23.4 million (or 16%) favorable variance to the Revised Budget. This number is also $6.4 million over last year’s Net Income of $165.5 million. The Firm outperformed last year’s AmLaw results with Profits Per Partner of $979,000 as compared to last year’s $956,000. In addition, the average compensation per partner increased from $597,527 in 2008 to $643,820 this year.
As a result of the Firm’s outstanding performance, the Executive Committee has approved a year-end distribution of $60.0 million. This represents an increase of approximately $14.0 million over 2008′s year-end distribution.
The $60 million distribution was funded today. Happy Thursday, Locke Lord partners! (According to the 2009 Am Law 100 rankings, the firm has 136 equity partners and 165 nonequity partners.)
The full LLBL memo appears after the jump.
* Cleary U.K. associate goes ape$hit at a Freshfields event. Totally nutters. Lots of pointing.
[Am Law Daily]
* Apple — with a little help from Orrick — tells Valleywag that paying people to steal trade secrets is illegal. [Gizmodo]
* … Which means Orrick, indirectly, wins Valleywag’s prize for confirming that Apple is indeed working on a “tablet.” [Valleywag]
* Here are some “basic” interviewing tips. I think some people could benefit from remedial interviewing tips. You know, important advice like “take a shower with soap,” and “Don’t talk about nice rack you saw while sitting in the lobby.” [Law.com]
* I spent about five minutes trying to figure out how to make this funny, then I realized there is nothing that I could to heighten the comic appeal of the headline as is: “East Boston Cat Called to Jury Duty.” [WHDH]
* Yet another wonderful reason not to go to law school [BL1Y]
Marin is away this week. She’s on vacation. But don’t worry, she reports that she’s having a miserable time. She wilts when people aren’t constantly asking her to fix their miserable lives.
Without Marin, a confused law student turned to Slate’s Dear Prudence to help her out with some troubles. Apparently this law student spent the winter break interviewing for summer associate positions. One firm asked her to come into the office for what turned out to be a wholly inappropriate test run. Click here to check out the situation and advice (scroll down to the last item).
After the jump, I wonder what Marin would say.
We’ve spent a lot of time discussing DLA Piper’s new compensation structure for its associates. I’ve assumed that DLA Piper’s changes have the support of DLA partners. I mean, we’ve received leaked memos from DLA partners defending the plan. But it’s wrong for me to think of partnerships as monolithic groups, especially at a firm as big as DLA. Partners don’t uniformly support every single move that leads to increased profits per partner — even when the decision is merely about keeping partner billing rates high. The ABA Journal reports:
Labor and employment partner Richard Hafets worked at DLA Piper for 34 years, but he has some gripes about the firm that is spurring him to jump to Jackson Lewis along with three other partners and four associates.
At DLA, Hafets told the Maryland Daily Record, the firm’s billing rates were so high that the employment lawyers were being priced out of the market.
“It was either stay here and see our practice stagnate at best and wither at worst, or try to find a way to revitalize our practice by reducing our rates,” Hafets told the Daily Record. He said he will be able to drop his billing rates by more than $100 an hour at the new firm.
From time to time, we hear that this kind of situation is one of the most underreported aspects of the legal recession. Some Biglaw partners feel that the rates they are forced to charge make it difficult to develop or grow business with cash strapped clients.
In this situation, Hafets blames the entire DLA model for crowding out his business. Details after the jump.
In addition to being one of the world’s most successful law firms, Skadden is also a public-spirited one. The firm just donated $100,000 to Haiti relief efforts, for example. (More on that later.)
The Skadden Fellowship Foundation, described as “a legal Peace Corps” by The Los Angeles Times, was established in 1988 to commemorate the firm’s 40th anniversary, in recognition of the dire need for greater funding for graduating law students who wish to devote their professional lives to providing legal services to the poor (including the working poor), the elderly, the homeless and the disabled, as well as those deprived of their civil or human rights. The aim of the foundation is to give Fellows the freedom to pursue public interest work; thus, the Fellows create their own projects at public interest organizations with at least two lawyers on staff before they apply.
Fellowships are awarded for two years. Skadden provides each Fellow with a salary and pays all fringe benefits to which an employee of the sponsoring organization would be entitled. For those Fellows not covered by a law school low income protection plan, the firm will pay a Fellow’s law school debt service for the tuition part of the loan for the duration of the fellowship. The 2010 class of Fellows brings to 591 the number of academically outstanding law school graduates and judicial clerks the firm has funded to work full-time for legal and advocacy organizations.
The 2010 class of Skadden Fellows was just announced. Congratulations to the 27 winners, selected from 20 different law schools. Yale had four, Berkeley (aka Boalt Hall) had three, and Stanford and Fordham had two each.
Check out their names, law schools, and sponsoring organizations — maybe you know some of them? — after the jump.
Is the customer always right? In the legal profession, not necessarily. As a lawyer, sometimes your job is to talk some sense into your client — and to refuse to move forward if your client, ignoring your advice, orders you to prosecute frivolous (or borderline frivolous) litigation.
Perhaps this is a lesson that needs to be learned by Kirkland & Ellis. The super-prestigious firm, known for its world-class litigation practice, recently got benchslapped by the Seventh Circuit. From Judge Posner’s opinion (PDF):
[T]he defendants’ motion for sanctions should not have been denied. The plaintiffs’ lawyers [at Kirkland] may secretly agree, for they make no attempt to counter the arguments for sanctions made in the defendants’ brief even though the district judge denied the motion without explanation. They follow suit by merely asking us, without explanation, to affirm the denial.
The motion complained that Carr is harassing the defendants with repetitive litigation, including a suit — this suit — that borders on the frivolous, even though he is an immensely successful lawyer represented on appeal by one of the nation’s premier law firms, Kirkland and Ellis, as well as by his son Bruce Carr of the Rex Carr Law Firm, which the plaintiff formed after the break-up of his old firm.
At least Judge Posner referred to K&E as “one of the nation’s premier law firms.” Slap that up on the Kirkland website?
Add Dickstein Shapiro to the list of firms that have decided to do away with lockstep associate compensation. As of January 22, Dickstein will adopt a new merit-based compensation system. Like many firms that have abandoned lockstep, Dickstein will be using a three-tiered system, similar to Orrick’s compensation structure.
Starting salary for new Dickstein associates will be $145,000. Or maybe it will be $160,000. Honestly, I can’t tell you with certainty what new associates will be making.
It’s not my fault, I read the original memo and everything. I talked to friends and sources and a spokesperson for the firm. I prayed on it. I just can’t seem to pin down one solid number of first year salaries.
After the jump, why don’t you guys take a look at the memo. Maybe you’ll have more success divining its meaning than I did.
Is suing a former client for unpaid bills a wise idea? Maybe not. As John Marquess, president of Legal Cost Control, told the New York Law Journal, “If I were advising any law firm, I would tell them suing a client over fees is a no-win situation. It’s going to get you adverse publicity you may or may not recover from. And if it went before a jury, juries hate lawyers.”
And what if your ex-client is, say, a green company devoted to the cause of sustainable forestry? Going after that client seems like an even worse idea from a PR perspective. Al Gore would not approve.
But Debevoise & Plimpton decided to move forward anyway with its $6 million lawsuit for unpaid fees (see last item). Now the firm is on the receiving end of some unpleasant counterclaims. From Am Law Litigation Daily:
On Wednesday morning, Debevoise’s erstwhile client, Candlewood Timber Group, filed an answer and counterclaims against Debevoise, seeking damages of $55 million. And some of Candlewood’s allegations about its former law firm aren’t very flattering….
Candlewood now asserts that Debevoise made critical errors, missed major points, and billed excessively for the work of inexperienced lawyers. The firm’s deficiencies, according to Candlewood, forced the company to accept less in a settlement than it should have. The company’s counterclaim contrasts Debevoise with Candlewood’s Delaware counsel–Bouchard, Margules & Friedlander—which successfully represented the company for two-and-half years at a total cost of $450,000. “Over a 10-month pretrial and trial period–during which time D&P had the assistance of BM&F and later Susman–D&P managed to bill for more than 15,000 hours, the equivalent of 10 lawyers working full-time for the ten-month period,” Candlewood’s counterclaim alleges.
Fifteen thousand hours? Not bad. It may not be a Siemens, but this is still the kind of matter that should throw off millions in fees (too bad for Debevoise that they weren’t paid, at least not in full).
More about Candlewood’s claims — plus highlights from the retainer letter, including D&P billing rates — after the jump.
When I think of the Conservative Political Action Conference (CPAC), I think of, well, conservatives. When I think of Liberty University, which claims Jerry Falwell Jr. as its chancellor, I think of conservatives. So when Liberty Law School sponsors a CPAC event, I don’t expect there to be major conflicts between the two organizations.
And, apparently, I would be totally wrong about that. A tipster sent us this link from OneNewsNow:
Liberty University Law School has withdrawn as a co-sponsor of next month’s Conservative Political Action Conference (CPAC) in Washington because a Republican homosexual activist group is being allowed to co-sponsor the event.
If there are some people who think the anti-gay-marriage movement is nothing but bigotry in drag, it’s because of institutions like Liberty Law School.
More details after the jump.
Yesterday the United States officially halted the deportation of Haitian illegal immigrants, on a temporary basis. The New York Times reports:
Homeland Security Secretary Janet Napolitano said Haitian deportations would be halted “for the time being,” without specifying a time period. Immigration officials said it was clear they could be putting Haitians’ safety at risk by sending them back to a country staggering from the vast destruction of the quake. About 30,000 Haitians in the United States are facing deportation orders, immigration officials said.
One could argue that there is a great and unfair disparity in U.S. immigration policy regarding Haitians as opposed to other Caribbean nations, like Cuba.
But it’s usually a bad idea to make long-term policy in the middle of a tragedy and crisis.
Still, the move from the Obama Administration here is different than the reaction of the Bush administration when hurricanes ravaged the island in 2008. Details, and a correction, after the jump.
* Taxing banks for fun and profit — remember McCulloch v. Maryland? Obama will propose a tax on big banks, to recoup taxpayer losses from the Wall Street bailout. [New York Times]
* Josh Levin and Dahlia Lithwick discuss yesterday’s Supreme Court argument in the American Needle case, regarding the application of antitrust laws to the NFL. Conclusion: the justices should just stick to baseball. [Slate]
* Meanwhile, on remand from the SCOTUS, the “fleeting expletives” case was argued before the Second f**king Circuit. [How Appealing]
* The feds decide not to go for trial #5 against John A. “Junior” Gotti (pictured). [CNN]
* “Zoolander” meets “Legally Blonde”? Male model goes to Yale Law School. [Yale Daily News]
* A profile of executive pay czar Ken Feinberg. “Where there is death and suffering, or merely bankruptcy and financial ruin, there, oddly enough, is Kenneth R. Feinberg.” [Washington Post]
* Haiti relief efforts continue. If you’d like to contribute, it’s as easy as texting “Haiti” to the number 90999. [Bits / New York Times]
In 2009, a small group of Harvard Law School students noticed an absurd monopoly in the bar prep space, held by an unchallenged leader with a non-evolving product. In response, these students teamed up with Harvard Law alumni to launch BarMax on January 14, 2010.
The mission: democratize bar prep by embracing new technologies to provide the very best bar exam review courses at a fraction of the cost normally associated with these courses.
Since then, with the encouragement of thousands of students and an unwavering commitment to their success, BarMax has established itself as a comprehensive alternative to the stagnant, over-priced status quo.
As we continue to expand, we do not want to lose sight of the basic premises that led us to create BarMax in the first place. If you are a law student who believes that there is something fundamentally wrong with being forced to take out yet another loan to pay for a $4,000 bar exam prep course, you are not alone.
Ed. note: This post is authored by Evan Jowers and Robert Kinney of Kinney Recruiting, sponsor of the Asia Chronicles. Kinney has made more placements of U.S. associates and partners in Asia than any other firm in the past five years. You can reach them by email: asia@kinneyrecruiting.com
Happy Chinese New Year! We were extremely busy the past few months, including most of our US based team working from our Hong Kong offices during November and December.
As a follow up from our recent post, which listed our 62 US associate and counsel placements in Asia last year (vast majority in HK / China), please note that thus far in January ’12, we have already made seven US associate and counsel placements in Asia. This is an especially impressive number, considering the biglaw lateral hiring market in Asia is down right now (see state of the market brief overview below). These new placements are of new hires in Hong Kong, Beijing and Shanghai, who were interviewing with their new firm for a month or more and they are spread out among different practice areas, including project finance, litigation, fund formation, M&A and cap markets. We are close on four additional new associate placements, in Hong Kong, Tokyo and Shanghai, that we expect to close soon. We do not discuss partner placements in these articles, but the pace of partner recruitment in Asia (a large part of our business) has continued.
Hedge Fund In-House Openings in Hong Kong
We are seeing a small run of new in-house openings in Hong Kong at hedge funds. We are currently filling three different in-house positions at three different hedge funds in Hong Kong, two of these searches we are handling on an exclusive basis. All three will most likely be filled by a US associate, with about 4 to 6 years of experience. Mandarin not required. Candidates from NYC and London will be considered, but at one of these funds the new hire will likely come from Hong Kong / China or Singapore (with HK being the strong preference).
Please feel free to reach out to us at asia@kinneyrecruiting.com if you are interested in these hedge fund openings. As you probably would expect, the competition for these spots will be fierce and the funds will be very selective when choosing which candidates to interview.
I’ve been trying to be optimistic about the future of Biglaw in 2010. There’s no harm in hoping for the best.
Continue reading “Outsourcing: It’s Cheap and Easy to Do.”
Great news for Biglaw partners and the associates who love them. Early returns suggest that despite the global economic meltdown that wrecked multiple American industries, profits per partner remained relatively stable in 2009.
On Wednesday, we 
We have previously 
Marin is away this week. She’s on vacation. But don’t worry, she reports that she’s having a miserable time. She wilts when people aren’t constantly asking her to fix their miserable lives.
In addition to being one of the world’s most successful law firms, 
* Taxing banks for fun and profit — remember McCulloch v. Maryland? Obama will propose a tax on big banks, to recoup taxpayer losses from the Wall Street bailout. [
