Last week, we wrote about reductions to the ranks of lawyers and staff at WilmerHale. We noted that the cuts, made in connection with twice-annual performance reviews, seemed to focus on IP litigation and on the Boston and Palo Alto offices.

Today we bring you additional information about the reductions, which look a lot like stealth layoffs. They seem to be more widespread, in terms of offices and practice areas, than previously reported.

And they might be due to some earlier overhiring, reflected in an interesting email we received….

Here is what we’ve heard from WilmerHale sources:

1. Lawyers have been cut in the Washington and New York offices as well as Boston and Palo Alto.

2. Although many IP litigators were dismissed, the cuts were not confined to IP; other departments have been affected as well.

3. Although a number of the affected lawyers were senior, including a number of counsel or soon-to-be counsel, some relatively junior associates were hit as well.

4. The firm’s internal messaging is consistent with its public statements: it’s denying that any “layoffs” have occurred.

Regardless of what you call them, the cuts have affected morale, even among lawyers who were not sent packing. As one tipster told us, “People are freaked and looking to leave, even if not in the direct bullseye of the layoffs. Senior associates in particular are looking for exit opportunities.”

“Some folks aren’t freaking out,” this source added. “But those of us who survived the 2009 layoffs know better.”

Interesting comments were posted to our earlier story (including some very specific comments, perhaps from a current or former WilmerHale associate, explaining how the firm’s performance review process works). Here’s one noteworthy comment, offering an explanation for the reductions in IP:

Wilmer probably over-hired laterals in patent lit from 2010-12, based on the Apple/Samsung cases that kept probably over 50 attorneys busy. With those cases dying down, it’s hard to find replacement work for 50+ attorneys, even as busy as patent lit is nationally

A dozen small troll cases in bogged-down district courts doesn’t match the workload caused by those Apple/Samsung cases, that were often tried in the ITC.

This is consistent with what we’ve heard directly from our WilmerHale sources.

“A year ago, the firm was begging for help in getting as many IP litigators in the door as possible,” a tipster told us. “At the time, some of us noted that Apple-Samsung wouldn’t be around forever. Sadly, looks like that came as a surprise to management — or it was the plan all along to thin the ranks when Apple-Samsung wrapped up.”

We got our hands on an email dated June 18, 2012, that corroborates this claim. The message trumpets WH’s hiring of lateral candidates and urges associates and counsel to help recruit more. Here’s an excerpt (the full email is posted on the next page):

To date in 2012, thirty-five U.S. lateral associates through counsel have started. We currently have more than thirty offers out, with over twenty of those offers accepted. Our pipeline is also very strong with more than forty candidates currently under review or going through the interview process.

While this is terrific progress, as you know, the Firm remains very busy and thus, continues to recruit talented associates through counsel across all Departments and U.S. offices. Given the demand, the firm is temporarily offering a referral fee of $20K for associate, senior associate and counsel referrals that are received by July 30 and start with us by October 15.

The list of openings in the email specifically mentions WilmerHale’s interest in hiring “Intellectual Property Associates, Senior Associates and Counsel.” It also notes that “we have open searches for Technology Specialists and Staff Attorneys,” touting a $3,000 referral bonus for such positions.

Now, just a year or so later, WilmerHale is openly laying off staff attorneys and quietly dismissing IP litigators. Paying referral bonuses for lawyers only to lay them off a year later does not seem like a particularly efficient approach to human resources management (although, in fairness to the firm, hindsight is 20/20).

In our prior post, we posed some questions to our readers: “What is the difference between “layoffs” and “firings”? What label applies to what happened at Wilmer? And are similar things happening at your firm?” Here is what one source said to us:

There’s no way the WH layoffs are normal. I suppose you could say it’s “performance based” in that if you had to get rid of 90 percent of your team you’d try to keep the top 10 percent of performers. But clearly the expectations have been changed. I’m reluctant to say they are stealth layoffs because they are pretty obvious.

Clearly WH made the calculation that it’s better to deny and risk being seen as dishonest than to admit and cement a reputation as a firm that conducted layoffs. I guess that makes sense, if you think about the way people seem to have remembered these things. Unfortunate though.

Unfortunate indeed — and, sadly, not the only such reduction taking place in Biglaw. We’re hearing lots of reports of stealth layoffs these days, including many that we never report on because of insufficient sourcing, a lack of detail, or conflicting accounts. If you can help us cover this important subject, please email us or text us (646-820-8477). Thanks.

(Flip to the next page to read the full memo about WilmerHale’s interest in lateral candidates.)


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