Back in December, some associates at Kirkland & Ellis expressed some displeasure about their bonuses. Now, make no mistake, the K&E bonuses still beat the market by a healthy amount; they just didn’t beat the market by as much as they usually do (at least according to some sources; under an individualized bonus system, reactions will vary).
In our bonus post, we wondered about K&E’s financial performance in 2013. Could the firm — which could very well be the nation’s finest law firm — have had a less than stellar year?
Associates might not be the only ones dissatisfied with their compensation. Sources point to a fair number of prominent partner departures over the past few months, in one of K&E’s top practice areas….
In early December, prominent private-equity lawyer Kirk Radke left Kirkland for Willkie Farr & Gallagher. The move raised eyebrows among Biglaw observers, given Radke’s high profile and the move’s odd timing. As Jennifer Smith noted in the WSJ Law Blog, “December isn’t the most obvious time of year for a well-compensated partner to hop from one law firm to the next,” since bonuses and other discretionary comp often go out just after that.
Radke’s departure set tongues wagging within the firm as well. “Pretty huge departure,” one Kirkland source told us. “Guy was one of the founders of the New York office, was basically the head of the corporate practice, and sat on the management committee. Huge rainmaker.”
Today brings news of more notable Kirkland departures, again from the Wall Street Journal:
Kirkland partners Stephanie McCann and Leonard Klingbaum are making the jump to McDermott Will & Emery LLP. Ms. McCann advises private-equity firms and their portfolio companies on financing, while Mr. Klingbaum represents companies, lenders and private-equity firms in debt-finance transactions.
“We have been quietly building and upgrading our private-equity capacity,” McDermott co-chair Peter Sacripanti told Law Blog in an interview. “We have also been building the bankruptcy practice, and one of the components of that is distressed debt.”
Other private-equity partners have left Kirkland in the past few months as well. For example, last month Albert Cho, who helped launch K&E’s private equity practice in Asia, moved over to Weil Gotshal.
According to one of our Kirkland tipsters, “[t]here’s definitely more going on under the hood.” This source predicted additional partner departures within the next month or so.
In fairness to Kirkland, partner departures happen all the time, especially early in the year. As our in-house columnist (and former Biglaw partner) Mark Herrmann recently wrote, “When a partner at a law firm moves laterally in January, that’s like leaves changing in autumn.” And Kirkland has been on the receiving end of a number of major partner departures too:
[Kirkland has] been building up its private equity group with some notable additions from big-name law firms, including Sean Rodgers (formerly of Simpson Thacher & Bartlett LLP) and Rick Madden (formerly of Skadden, Arps, Slate, Meagher & Flom LLP).
The firm has been hiring prominent partners outside the private-equity space as well. Last summer, for example, Kirkland won the Robert Khuzami sweepstakes, snagging the former head of enforcement at the SEC for a reported $5 million a year.
And Kirkland can afford to pay such compensation because the firm continues to thrive. As noted by the WSJ, “Kirkland appears to be doing just fine. Last year Kirkland worked on 68 global buyouts worth a combined $50 billion in the first three quarters of 2013, “dwarfing its nearest competitors,” according to legal publication Law360.”
So what’s going on at Kirkland & Ellis? Is there trouble in paradise, or is it just business as usual? Let us know, by email or by text message (646-820-8477). Thanks.
Prominent Private Equity Lawyer Kirk Radke Jumps to New Firm [WSJ Law Blog]
McDermott Woos Two Kirkland Finance Partners [WSJ Law Blog]
Weil Adds Hong Kong Partner [American Lawyer]
Earlier: Associate Bonus Watch: Kirkland & Ellis
Shatters Kinda Scratches The Bonus Market Ceiling
Musical Chairs: A Promising Young Partner Parts Ways With Cravath
Reading The Tea Leaves When Heads Roll