The latest layoffs involve both lawyers and staff, based out of two large legal markets, New York and Washington, D.C….
Here is what we’ve heard about the layoffs at Dickstein Shapiro:
- The firm has laid off staff and associates this month.
- A sizable percentage of associates in the New York office were laid off.
- The associate layoffs in D.C. were “fewer, but significant,” according to a source at the firm.
- These reductions were discussed in an internal memorandum circulated earlier this month.
We have not seen this memo, but if you have a copy, please feel free to email us. We reached out to the firm, which provided this comment through a spokesperson:
We periodically review the firm’s staffing to ensure that it is properly aligned with changing firm and client needs and make adjustments accordingly. We also continue to invest in practice areas which enhance our competitiveness and long-term success.
What might be driving the cuts? In terms of financial performance, last year wasn’t a bad year for Dickstein Shapiro, as noted by The BLT:
On paper, Dickstein Shapiro’s fiscal year 2012 financial metrics represented a big change from 2011. Whereas gross revenue held steady in 2011, last year it dipped 3.2 percent to $258.5 million. But revenue per lawyer, profits per partner and net income all showed strong growth. Revenue per lawyer climbed 7.7 percent to $840,000 and profits per partner increased 3.8 percent to $950,000. Net income had the largest gain of any metric category, jumping 8.9 percent to $55 million.
“From the perspective of our firm, we thought it was a good year,” chairman Michael Nannes said. “We know it’s a challenging time.”
But Nannes made these comments in February. In April, the Federal Circuit tossed a $482 million jury award to Bruce Saffran, a Dickstein client who sued Johnson & Johnson for patent infringement.
The case meant a lot to Dickstein. As we noted last year, it would have resulted in a big contingency fee had the verdict been upheld. In the wake of the Federal Circuit ruling, perhaps the firm felt cutting headcount would be prudent.
(Also note the mention in The BLT story of how attorney headcount at Dickstein declined by more than 10 percent in 2012. While that theoretically could be due to voluntary departures, such a sizable net decline strikes us as confirmation of the layoffs we covered last year.)
Are we going to see an entire week with a layoff story every day? We’re working on more such stories, sadly. If you can provide information or corroboration, please email us or text us (646-820-8477). We keep our sources confidential and anonymous. Thanks.
J&J Wins Reversal of $482 Million Patent Verdict Over Stents [Bloomberg News]
In 2012, Dickstein Shapiro’s Gross Revenue Dipped, But Net Income Grew [The BLT: The Blog of Legal Times]