The National Law Journal reports that eight firms have opened up offices in Los Angeles during the recession. Is this really going to work? We’ve already established that the San Francisco legal market is about as relevant as an aging hippie. Are we sure that L.A. is the promised land?
According to the NLJ, firms have been capitalizing on the glut of available lawyers in California:
To do so, many firms, such as Snell & Wilmer, Atlanta’s Alston & Bird, Philadelphia’s Blank Rome and Lathrop & Gage of Kansas City, Mo., took the opportunity to snag lawyers who recently became available, largely due to dissolutions and economic conditions.
It’s one of those days. We told you that we expected Blank Rome layoffs to come today. And here they come.
Blank Rome just confirmed that it has laid off 79 people: 27 associates, 52 staff.
And that’s not all. The firm is pushing back start dates for incoming first year associates until “at least” January 2010. No word on whether there will be any kind of extra money for those not-quite-yet first years.
But wait, there’s more. Blank Rome will also be scaling back its 2009 summer program from ten weeks to six.
I know that Friday the 13th is supposed to be a bad luck day, but honestly somebody needs to make a Saw-style movie about Thursday the 12th.
Now that K&L Gates finally announced its layoffs, it’s time to adopt a menacing flight pattern over another firm. We are hearing that Blank Rome is preparing to announce layoffs.
Our sources are telling us that 25 – 50 attorneys will be let go from Blank Rome late this week or early next week. We don’t have a conference room schedule handy to pinpoint the date, but the firm is buzzing that Thursday, March 12th is the most likely day.
The firm has not responded to Above the Law’s multiple requests for comment.
This would be the second round of layoffs at Blank Rome. Back in January, the firm laid off a number of associates and staff. As we saw yesterday, a lot of firms that have already made cuts are going back for seconds.
This round of layoffs is expected to focus on associates. According to some tipsters, that is very different than the last round.
As we noted in yesterday’s Morning Docket, even the New York Times has taken note of the salary freeze trend at law firms. The Times reached out to Above The Law’s own David Lat for the story:
Although many associates are angry about the freezes, others are relieved, said David Lat, founding editor of AboveTheLaw.com, a blog about law firms and the profession.
“There is this sense that firms didn’t act prudently during the boom and now they are getting religion, and that it’s better late than never,” Mr. Lat said. “Many associates we have spoken to think the freeze probably saved jobs.”
At the beginning of the month, we did a round-up of firms that have frozen 2009 salary rates at 2008 levels. That list was 16 firms long. Since then, quite a few other firms have announced freezes. Due to frequent requests, we’re updating the round-up list since the number of firms with freezes (that we know of) has more than doubled, to 33 32. Check out the as-comprehensive-as-we-can-make-it list, after the jump.
Last night and this morning, tipsters informed us that significant layoffs were taking place at Blank Rome. A firm spokesperson is now able to confirm the news:
As we continue to focus on helping our clients manage through these challenging economic times, and in order to position the Firm for continued success in 2009, it is important that we take the necessary steps to adjust our attorney and staff complements in the context of our clients’ current and anticipated needs. These are purely economic decisions – this is a group of talented attorneys and staff who have made valuable contributions to our Firm.
Our tipsters report that at least 12 associates and staff have been let go so far. But:
Also, there is an unconfirmed report that when this ends the total of layoffs will be 50. Good lord.
The firm could not provide us with official numbers of how many people will be let go by the end of the day.
But we do understand that the layoffs will affect all departments and class years — we know some non-equity partners have already been shown the door. Blank Rome’s Philadelphia office was hardest it, but layoffs happened in New York as well.
Maybe if Mos Def would pay his bills, this wouldn’t be happening.
We’ve previously reported on law firms having difficulty getting clients to pay their bills. It’s not just happening to firms working on deals that go bust; it has also happened to a firm representing a celeb after his marriage went bust. From Am Law Daily:
Blank Rome is suing rapper/actor/activist Mos Def for over $60,000 in unpaid legal bills stemming from his 2006 divorce from Maria Yepes.
The couple ended their 10-year marriage that year in a Brooklyn court, with Judge Sarah Krauss pleading with them to settle their differences outside her courtroom.
Reports say that the Brooklyn-born Mos Def (real name: Dante Smith) owes the money to Blank Rome in the form of unpaid fees and retainers. The Emmy, Golden Globe, and Grammy award-nominated entertainer retained lawyers from the firm’s well-regarded matrimonial practice, which advises high-end clients on divorce, mediation, property distribution, paternity, visitation rights, and trusts and estates.
This is Mos Def’s second month in a row of legal troubles. In November, Las Vegas police issued an arrest warrant after Mos got in a scuffle with a photographer. In more bad news, his portrayal of Chuck Berry in the recently released music biopic extravaganza Cadillac Records was panned by the Los Angeles Times.
We wonder if this will make him rethink the title of his upcoming album, rumored to be titled Ecstatic.
Our continuing coverage of no offers suggests that a 90% offer rate is actually outstanding. Today we have news from two more firms that fell short of 90% but still made offers to the majority of their 2008 summer associates.
Our tipsters were right on the money with the information that Blank Rome no offered 4 summer associates out of a class size in the mid-20s. According to Blank Rome spokesperson Topper Ray:
Our 2008 summer associate class was comprised of 28 summer associates -24 2L’s and 4 1L’s. 20 out of 24 2L’s received offers.
Ray also confirmed that the 4 1Ls received invitations to summer with the firm next year.
In this market an 83% offer rate isn’t terrible, even though Blank Rome was able to extend offers to all of their 2007 summer associates. The news was a little worse at another Philadelphia powerhouse, Pepper Hamilton. According to Pepper Hamilton spokesperson Polly Coxe:
In 2008, Pepper Hamilton extended offers to 20 of 27 summer associates in Philadelphia (two students withdrew from consideration before we made offer decisions). Firm-wide, we made offers to 30 of 38 summer associates. This is approximately the same number of offers we extended the past two years.
More from the streets of Philadelphia after the jump.
This isn’t super-exciting news, since the key point — an increase in starting salaries — was previously announced.
But in case you’re interested, the pay raise (and bonus) memo of Blank Rome — which announced an increase in first-year associate salaries last fall, but said it was still “reviewing the compensation levels for all Associates to make appropriate incremental increases based on class year” — appears after the jump.
Yesterday Blank Rome announced associate pay raises, of varying sizes, that will take effect in 2008. The firm will move to a starting salary of $160,000 in New York, but not in Washington. In the Philadelphia mother ship, starting pay will be $145,000.
The billable minimum at Blank Rome is 2000 hours. Here’s the memo: MEMORANDUM
TO: All Attorneys
FROM: David F. Girard-diCarlo, Chairman
Carl M. Buchholz, Managing Partner and Chief Executive Officer
RE: Associate Compensation
We are pleased to announce that the Firm will be increasing starting salaries for Associates, effective January 1, 2008. Starting salaries for Associates in New York will be increased to $160,000, in Washington to $150,000, and in Philadelphia to $145,000. All other offices will be appropriately adjusted to reflect their respective markets.
In addition to increasing starting salaries, we are reviewing the compensation levels for all Associates to make appropriate incremental increases based on class year. Adjustments will be made effective January 1, 2008, and the information regarding these adjustments will be communicated directly to Associates by the Practice Group Leaders once they have been determined. These adjustments will be in addition to the merit increases and bonuses being awarded to our Associates.
We’ve previously covered Denver and Hartford. Today our series of posts profiling associate compensation in various smaller legal markets — smaller than New York or Washington or Los Angeles, at least — turns to Philadelphia.
What’s going on in the City of Brotherly Love? Based on some recentarticles we’ve read, it seems that the standard starting salary in Philly hovers between $135,000 and $145,000. At $135K: Schnader Harrison Segal & Lewis; Ballard Spahr Andrews & Ingersoll; Duane Morris; Blank Rome; Wolf, Block, Schorr & Solis-Cohen; and DLA Piper. At $145K: Morgan, Lewis & Bockius; Dechert; Drinker Biddle & Reath; and Pepper Hamilton.
Will Philly move to the $160K scale anytime soon? If so, when? And who will lead the charge?
In the cheesesteak metropolis, starting salaries aren’t the only issue. Per a commenter:
[W]hen you do [Philadelphia], please make sure to point out our mid-level comp which sucks. We get about a 5k raise per year (though [in] some years we do get 10k but not most). After 7 years we’re just clearing 200k.
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The holiday season is upon us, and yet again, you have no idea what to get for the fickle lawyer in your life. We’re here to help. Even if your bonus check hasn’t arrived yet, any one of the gifts we’ve highlighted here could be a worthy substitute until your employer decides to make it rain.
We’ve got an eclectic selection for you to choose from, so settle in by that stack of documents yet to be reviewed and dig in…
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