Brown Raysman

Thelen new Thelen Reid Brown Raysman Steiner LLP Abovethelaw Above the Law legal blog tabloid.jpgThe rumor making the rounds of lawyer and staff layoffs at Thelen Reid Brown Raysman & Steiner is true. We just spoke to Thelen’s co-chair, Stephen V. O’Neal, who provided confirmation and details.
The firm is in the process of laying off 26 associates and 85 staff members, on a firm-wide basis, “in response to recessionary pressures.” (Unlike President Bush, Mr. O’Neal was not afraid to use the “r” word.) Thelen has approximately 600 lawyers, per its website, so the cuts amount to roughly 4 percent of total headcount.
With respect to the location of the affected lawyers, the cuts affected all major offices. With respect to seniority — one source told us that some first- and second-year associates were fired — Mr. O’Neal said that “some were fairly junior, and some more senior.”
In terms of practice areas, Mr. O’Neal said the layoffs were spread out among groups, but with “some areas more impacted than others,” including certain parts of capital markets and cap-markets-related real estate work. He noted that other practice areas are “thriving and increasing in scope,” including renewable energy, cross-border M&A, China practice, litigation, and workouts / bankruptcy.
With respect to staff layoffs, Mr. O’Neal explained that they are due in part to the economic climate, but in part due to post-merger staff redundancies. The merger of Thelen Reid and Brown Raysman took place in late 2006, making the consolidated firm a little over a year old. But the firm did not do much cutting of staff in 2007.
Last year “was not a year when we tried to make deep cutbacks in anything, even though we had combined two good-sized firms,” explained Mr. O’Neal. “It was a year of building, coordinating, and consolidating. We wanted to understand how best to organize this new entity.” Now that the firm has a better understanding of its staffing needs, and is in the process of consolidating multiple offices in the same cities (e.g., New York), it is reducing staff redundancies.
As for associate severance packages, Mr. O’Neal stated that firm provided a “market-level” package. We floated three to four months as our understanding of market, and he said that the firm is “in that ballpark.”
“We are anticipating a profitable 2008,” said Mr. O’Neal. “We are being prudent businesspeople, and when you are dealing with recessionary pressures, you adjust your business so you will have — and maintain — a strong level of profitability, notwithstanding those pressures.”
We thank the firm for the information and candor with respect to the layoffs (i.e., not casting these departures as “performance-based”). If you have more information, feel free to email us.
Updates: A few additional nuggets:

1. As noted in the comments, total headcount includes partners and counsel, so the percentage of associates laid off is higher than 4 percent. Some of you suggest it’s around 10 percent.

2. We’re a little annoyed at Legal Pad for the lack of an ATL shout-out — in both the blogosphere and the MSM, it’s proper form to credit and/or link to the source that breaks a story first (even if you were working on the same story too) — but we’ll link to them anyway.

They have more on the Thelen layoffs here. Much of the info in their post appeared previously in ours, but they do add that the firm “is also trimming its summer program from eleven to eight weeks and is pushing the start date for first-years from September to January.”

3. A source at the firm tells us that the severance packages were in the two- to three-month range.

Earlier: Prior ATL coverage of layoffs (scroll down)

musical chairs 2 Above the Law legal blog above the law legal tabloid above the law legal gossip site.GIFFrom Biglaw to business:
* Another Wachtell Lipton partner is leaving the firm. Corporate partner Mitchell Presser recently left to join Fox Paine. We now hear that WLRK real estate partner Michael Benner may be leaving to become general counsel at real estate giant Tishman Speyer.
New Partners:
* Dorsey & Whitney: Banking lawyer Mark Jutsen.
Lateral Moves:
* Speaking of Dorsey & Whitney, they’re closing their San Francisco office. Ten IP lawyers from that office are joining Morgan, Lewis & Bockius.
* With the Brown Raysman-Thelen Reid & Priest merger about to become official, two entertainment and IP lawyers are leaving Brown Raysman’s L.A. office. Partner Brian Pass and associate Kevin Straw are joining the Century City office of Sheppard, Mullin, Richter & Hampton.
NY Lawyers On the Move []
As Firm’s Outpost Sinks, 10 IP Attorneys Jump Ship []
Firms’ Merger Spurs More Exits []

thelen reid & priest brown raysman.JPGOn the heels of the Dewey Ballantine/Orrick announcement, news of another law firm merger:

Partners at Thelen Reid & Priest and New York’s Brown Raysman Millstein Felder & Steiner voted to combine the two firms Monday, creating a 617-lawyer firm that, based on last year’s revenue, would have placed 56th on the Am Law 100 list.

The firm will be called Thelen Reid Brown Raysman & Steiner, and will be co-chaired, for 2 1/2 years, by Stephen O’Neal, Thelen’s chairman, and Julian Millstein, Brown’s co-managing partner.

Number 56? Skadden is hardly quaking in its boots.
The first thing you want to know when you hear about a law firm merger: What are the profits-per-partner at the respective firms?
Here are the numbers, from the WSJ Law Blog’s “wedding announcement” (cute):

Thelen Reid, 82 years old, is originally from San Francisco and has 391 lawyers. Its average profits per partner in 2005 were $850,000, according to the most recent American Lawyer survey. The firm has a prominent project finance practice and has a substantial presence in the construction, infrastructure, and energy industries.

Brown Raysman, 27 years old, is from New York. With 226 attorneys, the firm is known for its corporate and technology practices. Last year’s profits per partner at Brown Raysman were $720,000.

kremlin moscow red square.jpgBut here’s the rub: Thelen Reid has a two-tier partnership structure, while Brown Raysman only has one. Ruh-roh…

[Brown Raysman] partners at the combined firm will be slotted into San Francisco-based Thelen’s two-tier system of equity and non-equity partners….

Millstein [of Brown Raysman] said some of his colleagues will lose equity status, though he wouldn’t say how many. At the same time, he said, some Brown Raysman partners who don’t now share in the firm’s profits at all will be given some equity in the combined firm.

So some equity partners are going to be “de-equitized,” while other non-equity partners will be promoted to equity partner status. Interesting.
The environment over at Brown Raysman must be just delightful right now. Like the Kremlin, right before a big purge.
If you have any dirt about the merger to share with us, please drop us a line.
Partners Bless Thelen Reid-Brown Raysman Merger [The Recorder]
LB Wedding Announcement: Thelen Reid & Brown Raysman [WSJ Law Blog]
Earlier: At Least They’re Not Merging With Cheetham & Howe