Ed. note: Above the Law has teamed up with Law Shucks, which has done excellent work translating all of the layoff news into user-friendly charts and graphs: the Layoff Tracker.

This week, economists missed on the good side — initial jobless claims fell by more than expected. The 502,000 applicants are the fewest since January 3, and the four-month rolling average is at the lowest level since November 2008.

It’s tough to grasp half a million people filing for first-time benefits as good news, but these are troubled times, so we have to cheer where we can. Don’t get too excited, though. Even news that looks good at first glance probably isn’t. The 139,000 people who came off the continuing-claims roster more likely did so as a result of benefits running out or giving up the search than actually finding work.

But don’t be surprised if that number starts creeping back up. A bill was passed last week that will extend benefits by 14 weeks in all states, and six additional weeks in states where the unemployment rate is greater than 8.5%.

All in all, it was a relatively good week in BigLaw, with no layoffs reported. Nonetheless, firms continue to flail about trying to fix their economic models, and we document the efforts after the jump.

Oh no. Is it really time to crank up the salary freeze watch again? I thought that the big question this winter would be whether firms that froze salaries last year would be unfreezing pay for 2010. And whether or not the raises were a “true up” raise that put people up to where they would have been absent last year’s freeze.

Instead, could we be looking at a winter where firms that did not freeze last year decide to freeze this year? A tipster reports on some disturbing news coming out of Covington & Burling:

Covington just announced salary freeze for all offices but NY; NY TBD. All-associates meeting.

Above the Law reached out to spokespeople at Covington. Read the firm’s statement after the jump.

The stalk-and-eventually-marry-your-doorman phenomenon continues to enthrall the NYT weddings editors. This week they shine the spotlight on yet another bride — this time a producer at CNN — who found love in the lobby. LEWW encourages female Biglaw associates to embrace this trend. You’re in and out of office buildings all day, ladies — open your eyes to the lusciousness perched behind those security desks!

And now, this week’s finalist couples:

1. Monique Mendez and Graham O’Donoghue

2. Ashlee Conley and Andrew Veit

3. Anne Claiborne and Andrew Grotto

Read all about these newlyweds, after the jump.

For those who have been following the Supreme Court case American Needle v. NFL (previously blogged about in more detail here, here, and here), this Friday clothing manufacturer American Needle Inc. will file its opening brief, arguing that the Seventh Circuit Court of Appeals was wrong to define the NFL as a single-entity under Section 1 of the Sherman Act.

As many of you know, I have long agreed with American Needle’s view that the NFL should be treated as a collection of 32 separate clubs, and not as a single entity. To me, this issue was best resolved by the Second Circuit back in the 1982 case North American Soccer League v. Nat’l Football League, in which that court held “the sound and more just procedure is to judge the legality of [sports league] restraints according to well-recognized standards of our antitrust laws rather than permit their exemption.”

Currently, the Second Circuit’s view remains in the overwhelming majority, as seven previous courts have upheld this view and rejected the NFL clubs’ single-entity argument. The Seventh Circuit meanwhile remains alone in its iconoclastic position that single-entity status should be determined one league at a time, one function at a time.

American Needle’s counsel on this matter in the law firm Jones Day. The National Football League meanwhile is represented by Covington & Burling LLC—a firm where former NFL commissioner Paul Tagliabue serves as Senior Of Counsel.
_______________________________________________________________________________
Marc Edelman is a Professor at Barry Law School in Orlando, FL. He previously was a Visiting Professor at Rutgers School of Law-Camden. His bio is available here, and his publications, here.

Yolanda Young is back with a vengeance, and an amended complaint against Covington & Burling.

The brief synopsis on Young is that she was a Covington & Burling staff attorney who sued the firm for racial discrimination. Covington has denied the charges at every point. The firm briefly got the suit tossed, but it was reinstated.

Young’s basic allegations remain the same:

Through its pattern and practice, Defendant, Covington & Burling LLP, systematically relegates its black attorneys to its lowest rung of practicing attorneys — the position of staff attorney. Firm policy bans the promotion of staff attorneys to the position of associate and, ultimately, to partner. This prohibition adversely impacts Defendant’s black attorneys by consigning the majority to earning less money, performing less challenging work, and enjoying less opportunity for professional growth than Defendant’s nonblack attorneys.

This time around, Young argues that black staff attorneys at Covington are more qualified than their white colleagues:

Young points out that while Covington uses a combination of law school grades, journal membership, and clerkship experience to determine the assignment of its attorneys, many of their partners — who decide how an attorney should be assigned — lack such credentials, but presumably are able to perform adequately at partner-level.

Young also asserts that black practicing attorneys, as a group, typically graduated from higher ranked law schools than their white colleagues and that, more often than their white counterparts, black staff attorneys attended law schools from which Covington’s partners, counsel, and associates graduated.

I think I know what is going on here. See, this is a revenge fantasy lawsuit. And Covington has been typecast in the role of Major King Kong.

After the jump, Young brings charts to back up her claims, and announces her full intentions exclusively to Above the Law.

Moving right along with our Vault open threads, it’s time to take a look at the firms ranked #6 - #10.

6. Weil Gotshal
7. Simpson, Thacher & Bartlett
8. Cleary
9. Covington & Burling
10. Kirkland & Ellis

Weil’s strong move up the Vault charts — the firm was ranked #9 last year — shows the power of high profile work. The Lehman bankruptcy and the General Motors restructuring were just two of the many recognizable matters Weil has had its hands on in the past 12 months.

But Weil also seems to have timed the Vault rankings quite well. The firm didn’t start deferring incoming first years until March, didn’t start laying off staff until May, and didn’t start laying off associates closing offices until the end of June.

Regardless of whether or not those moves catch up with Weil next year, right now is Weil’s time to shine in the warm recruiting light of sixth place. Congrats.

Let’s look at the other firms after the jump.

* Crocs have no teeth when it comes to fighting legal battles. The footwear company has settled five design defect lawsuits filed by parents whose children suffered escalator injuries. [On Point News]

* Yolanda Young’s suit against Covington & Burling is back on. [BLT]

* The ATL editors are not the only legal groupies in New York. [New York Times via Gothamist]

* Blago’s judge is prepared for theatrics in the court. [Associated Press]

* Looks like Rihanna and Chris Brown may be violating the judge’s “two-way” stay-away order. [New York Post]

* The latest abortion legislation. [Slate]

* Senators Orrin Hatch and John Cornyn will vote against Sonia Sotomayor for the Supreme Court. [Associated Press]

* Law school students interning in the Brooklyn DA’s office lack salaries and chairs. [New York Times]

* Is the ABA a club that’s not cool anymore? [National Law Journal]

We have chronicled Biglaw firms that are taking drastic measures to reduce the money they spend on summer associates and recruiting. This spring, McDermott Will & Emery cut salaries of its summer associates. This week, Morgan, Lewis & Bockius canceled its entire 2010 summer program. And, in between, current summer associates and future summer associates have suffered all kinds of indignities.

But folks at Covington & Burling must be happier than a nerd in a library. The firm reached the Final Four in our Safest Firm tournament this past March. Now it’s telling current summer associates that the firm’s strong finish was no fluke.

After the jump, let’s all be jealous of the good fortune of those working at Covington & Burling.

We were dying to write about this wedding announcement, featuring a slutty Strawberry Shortcake costume (WTF?) and a wacky/tacky proposal story. But alas, commenters would have crucified us for elevating comedic potential over excellence.

So behold, this week’s finalists. They include five Harvard degrees, five Yale degrees, and OMGOMGOMG the best Article III officiant ever. Enjoy.

1. Jessica Richman and Matthew Smith

2. Jessica Hertz and Christopher Angell

3. Ashley Lynn and Kenneth Leonczyk Jr.

The scoop on these legal-eagle weddings, after the jump.

We’ve been following the lawsuit filed by former Covington & Burling staff attorney Yolanda Young against Covington. She alleged that various incidents of racial discrimination derailed her Covington career.

Covington denied those claims.

Today, we have a judgment. Attorneys from Akin Gump — which represents Covington in this matter — sent out the following press release, earlier today:

United States District Court Judge Reggie B. Walton today dismissed Yolanda Young’s lawsuit against Covington & Burling LLP after Ms. Young and her attorney failed to appear for a court hearing.

Young filed her complaint in February 2009 against Covington and five of its present or former lawyers. Covington answered, denying Ms. Young’s allegations. Separately, on March 11, Covington filed a motion to strike certain of plaintiffs’ allegations on the grounds that they were false and scandalous, a motion which plaintiff neither responded to nor disputed. In addition, two of the individual lawyer defendants moved for dismissal for failure to state a claim against them, which the Court granted on May 28.

The Court on May 14 issued an order warning plaintiff that her failure to abide by the Rules and participate in a meet and confer conference might be treated as grounds for dismissal. Today’s hearing was scheduled more than two months ago. When neither Ms. Young nor her attorney, Latif Doman, appeared for the hearing or contacted the Court, Judge Walton dismissed the case without prejudice for want of prosecution.

Talk about anticlimactic.

After the jump, more details from the order.

In March, we reported that Skadden was essentially canceling its staff attorney program. We reported:

Only staff attorneys that were “integral” to ongoing matters have been kept on. And there is no word on whether those people will have any job security after their matters wrap up.

It appears that Covington & Burling is also undergoing a major reduction of its staff attorney program.

Tipsters (including some recently laid off staff attorneys) report that firm management has decided to effectively discontinue its staff attorney program. The firm has been letting go of staff attorneys at the rate of a couple per week over the last few weeks. As we understand it, as staff attorneys finish up their active matters, they are being let go.

Our sources tell us that the decision was made by firm management some weeks back. At the time the decision was made, the staff attorney manager was out of the office on vacation. When she came back, she allegedly told Covington’s staff attorneys that they should start circulating their resumes.

In some cases, laid off staff attorneys are being given a one week severance option. One week, if they sign a form promising not to sue the firm over the circumstances of their termination. Some Covington personnel that spoke to Above the Law believed that clause is proof that Covington decided to move out staff attorneys as a response to the lawsuit filed by former-Covington Staff Attorney Yolanda Young.

After the jump, we have statements from Covington & Burling, and Yolanda Young.

We’re pleased to announce that HLS grads Tracy Zuckerman and Ryan Van Grack triumphed in a high-turnout vote to win ATL Couple of the Month honors for April. Kudos!

On to this week’s contest. Once again, it’s too close for us to call, so get your voting fingers ready; there’s a poll after the jump. Here are the entrants:

1. Elizabeth Arens and Christopher Mathews

2. Jennifer Toll and Brett Schulman

3. JoAnn Kamuf and Rusty Ward

Check out these couples’ resumes and photos, after the jump.

Living under the constant threat of layoffs or salary cuts is no fun. But even though many firms are shedding employees and most firms are looking for ways to reduce their overhead expenses, there are many AmLaw 100 firms that are weathering the economic storms without coming down on their associates.

But it is a moving target. Just because a firm hasn’t announced a major expense reduction yet, doesn’t mean one isn’t in the works. Quiet doesn’t necessarily mean secure.

However, when a firm goes through the trouble of publicizing all the things it is not doing, that is the kind of good news that many associates are waiting to hear. Covington & Burling recently made just the kind of public statement of health that few firms have been willing to make.

Details after the jump.

* The Pennsylvania Supreme Court ruled that hundreds of juvenile court cases in Luzerne County, Pennsylvania will soon be overturned. After former judge Mark Ciavarella pleaded guilty to accepting bribes from juvenile prisons in exchange for more convictions, the state hired a “Special Master” to investigate. He is not a Malasian Martial Arts expert or the Commander of a space shuttle. [WNEP news]

* Cuomo is still running around in his superhero cape putting out bonus fires. He has expanded his investigation into credit derivatives to see whether banks like Goldman Sachs received taxpayer funds. Do I smell a presidential run in 2012? [Bloomberg]

* In a stunning act of self parody, Alaska Governor Sarah Palin has picked a Director for the NRA for the state’s new Attorney General. Check out this sweet picture of him sitting on a hummer. [Anchorage Daily News]

* Former Secretary of Homeland Security Michael Chertoff has joined Covington & Burling. [Covington & Burling LLP]

* Wisconsin Attorney General J.B. Van Hollen has a different response to executive compensation than Cuomo and Blumenthal. He says “..there is no law in Wisconsin making a contract illegal simply because someone is well compensated.” [The Wall Street Journal]

* In case you missed it, ATL got a shout out in the New York Times and Time Magazine.

Back in rosier economic times, we started a series of open threads on career alternatives for attorneys, i.e., things you can do with a law degree that don’t involve Biglaw or contract work. These days, we’re starting to think of the series as things you might do if you can’t find Biglaw or contract work.

The latest installment in the series is inspired by a profile in last weekend’s Washington Post Magazine of “Saphira,” a lawyer who traded in regulatory analysis for shimmying in sequins and spangly scarves.

Rachael Galoob-Ortega has been a “professional oriental dance artist,” a.k.a. bellydancer, since 1996. She used to just moonlight as a bellydancer while working full-time as a partner at a small firm, The Salem Law Group. That led to at least one embarrassing incident, recounts the Washington Post. A potential career downside is having to perform for judges inside and outside of the courtroom:

After passing the bar on her first try, she started practicing at a Sarasota law firm representing building contractors. She also joined a belly-dance troupe that performed at high-end soirees. Her two worlds comically collided one night, after she’d spent part of the day discussing the motion docket with a county judge. At a party that evening, she was in the midst of a solo dance, dressed in full belly-dance garb and a long wig, when she shimmied up to a table and recognized the judge. “He said: ‘Oh my God. That’s Rachael Galoob — she was in my courtroom today!’ ” Saphira recalls. “And of course, the room erupted in laughter.”

She winked at the table and moved on.

We hope that after winking, Saphira told the judge, “These hips don’t lie.”

The Oklahoma City University Law grad also has an LLM from Georgetown. She gave up her full-time law job to open Saffron Dance studio in Arlington. The tipster who sent us this story says:

There are lots of belly-dancing lawyers. No fooling. We sometimes call ourselves founding members of Raqs Judicata (Raqs Sharki is the Arabic name for the dance). It’s a great exercise for people who have to sit in front of computers all day long drafting briefs and memos.

Indeed, Saphira has even recruited a Covington & Burling partner teach at her studio. More on that, as well as video of Saphira in action, after the jump.

(Warning: It’s not just shaking the belly. There’s also copious licking of lips and tossing of hair.)

It’s been a dark week on ATL. Layoff news has been pouring in: 21 attorneys cut at Katten, up to 60 at Sonnenschein, and 20 at Clifford Chance.

To prevent you from jumping out your windows, we’re revisiting a Wall Street Journal article from earlier this month on the silver lining for law firms during the economic crisis.

Firms with relatively strong balance sheets are hiring lawyers from competitors that are hurting from the dropoff in mergers, debt offerings and other staples of the legal business. Leaders of these firms figure that being bigger and more geographically diverse will help them weather downturns in particular market sectors and capitalize on complex business opportunities that require a variety of specialties. In most cases, they’re even giving the new hires raises.

Did you hear that, despondent ones? Raises!

Many firms have been feasting on the remains of Heller Ehrman (R.I.P.). Heller partners and attorneys have been snatched up by Hogan & Hartson; Orrick; Sheppard Mullin; Arnold & Porter; Covington & Burling; Jones Day; and Cooley Godward Kronish. Other firms have been poaching partners from struggling Thelen.

Some firms are buying on the cheap, while others are giving new attention to more resilient practice groups:

K&L Gates LLP has acquired medium-size firms in Texas and North Carolina this year and hired 45 partners from other firms. “We have no debt — no long-term debt, no short-term debt — and therefore have a balance sheet that allows us to grow aggressively into a downturn,” says Peter Kalis, chairman of the 1,700-lawyer firm…

But many law firms believe that they have no choice but to expand specialties, such as restructuring, intellectual property, securities litigation and antitrust, that are generally believed to remain steady — or even pick up — during down cycles. Cadwalader, Wickersham & Taft LLP in New York laid off 131 lawyers — nearly 20% of its staff — earlier this year because of the implosion in the mortgage-backed securities market, a key practice area for the firm. But it has hired lawyers in other practice areas, including financial restructuring.

Chins up.

Some Law Firms Hire in Slump [Wall Street Journal]
As Heller is sliced and diced, many associates are out in the cold [National Law Journal]

Earlier: ATL Layoff Coverage

Heller Ehrman continues to stave off involuntary bankruptcy, despite not being able to pay employees their accrued vacation time. But Heller’s breakup continues to take weird twists.

The latest bizarre news comes from Seattle, where some associates have wondered whether they are about to be evicted from their offices. Tension was so high that Heller management had to send around a clarification email:

TO ALL HANDS (SEATTLE):

I have heard various rumors in the hallways to the effect that the Seattle office will close imminently and therefore that everyone needs to move out pronto. To clarify, here is the status.

The landlord has not issued a notice to vacate. If such a notice were issued, the notice period would be ten days. For reasons too long to explain, we overpaid rent throughout 2008. When those overpayments came to our attention, the firm asked that they be applied to cover (completely) the October rent obligation. The landlord has since asserted that the overpayments instead should be applied toward a fee that was due in connection with our give-back of space on 58. The Dissolution Committee is working with our outside counsel and communicating with the landlord to hopefully resolve this issue, and to clarify with the landlord any issues relating to removal of property from our space. To the best of my knowledge, closure of this office is not imminent and the date of closure remains to be determined, based on the pace of collections versus ongoing costs and also based on the banks’ decisions about what spending they will approve.

A law firm on the edge of solvency “overpaid” their rent? We hope that the explanation for this oversight is too long and difficult to get into, but we wonder if it is just too embarrassing.

Meanwhile, the Heller refugees that ended up at Covington have officially started .

Associates that we are speaking to say that it is just starting to sink in that they will be out of a job soon. Hopefully the Seattle associates will get as much time as possible to come to grips with this reality, instead of showing up at the office one day only to find locks on the door.

Update: The Blog of the LegalTimes reports that Arnold & Porter has picked up the latest Heller refugees. The big fish is Kenneth Chernof, Heller’s managing partner in the D.C. office. Any associates coming along for the ride?

Homeless In Seattle? [Heller Highwater]
Heller partners join Covington & Burling [Business Journal]
Arnold & Porter Picks Up Heller Partners [The BLT: Blog of the LegalTimes]

Earlier: Anatomy of a Dissolution: BoA & Citi Tell Heller Ehrman There’s No Money For Vacation Time

* President Bush wants lawmakers to hurry up and pass the $700 billion bailout plan. Sounds like taxpayers are going to be paying back those $600 economy stimulation rebates and then some. The Dems agree to drop the provision giving greater authority to bankruptcy judges. [New York Times]

* Democrats sue in Washington to force “G.O.P.” gubernatorial candidate to embrace his “Republican” identity. [New York Times]

* Guantanamo prosecutor quits, citing ethical concerns. [Washington Post]

* Kudos to these four law firms. Covington, Arnold & Porter, Katten, and Pillsbury make Working Mother magazine’s best employers list. [National Law Journal]

* Who would have thought a gas mask would be needed for a DUI arrest? [WSAZ]

* Gibson Dunn’s Ted Olson will appear before SCOTUS for the 50th time this fall. One secret to his success: St. Michael the Archangel. [Legal Times (subscription req.)]

* ATL’s former bling-bling lawyer of the day, Gabriel Schwartz, was robbed of property worth only $63,000, by his random-lady-friend-turned-thief. [Associated Press]

It turns out that the mystery meeting at Covington & Burling involved some great news for Covington, and some bad news for Heller Ehrman.

Fifteen IP partners will be leaving Heller to join Covington, as Covington expands into Silicon Valley. The Daily Journal reports that in the wake of the latest defections and yesterday’s failed merger, Heller Ehrman has decided to stop seeking merger options:

Heller management told the firm attorneys Monday that they are going to cease merger pursuits and “try to go it alone,” the Heller attorney said. But some legal observers said this could be a sign of Heller’s imminent dissolution. Heller partners have been in clustered meetings all day, the Heller attorney said.

Guess San Francisco isn’t far enough west to escape the tough economic climate for law firms.

This should be great news for Covingtion, and you would think they would want to spread the word about their hiring coup. But apparently not. A tipster’s report on yesterday’s firm-wide meeting:

First came the ten-minute lecture regarding tipping off the blogs, and then the news about Silicon Valley. It surprises me that they were so freaked out about the spread of positive news in the scary economy.

It surprises us too. It’s hardly a bad thing if Covington’s surrogates do a better job of publicizing the firm than Covington’s own PR people.

As always, we thank all of our tipsters who are willing to sit through ten minutes of “lawyer talk” in order to bring us the latest information.

Partners Leave Heller as Mayer Backs Off [Law.com]
Heller Ehrman, Mayer Brown Merger Is Off [Daily Journal] (subscription)]

Earlier: Covington & Burling’s Mystery Meeting
Law Firm Merger Mania: The Heller / Mayer Merger Is Off

Last month we reported on merger talks between Heller Ehrman and Mayer Brown. Those talks have now been called off, as reported earlier today by Am Law Daily. This leaves the San Francisco-based Heller with another failed romance.

From an email sent out today on behalf of Mayer Brown chairman James Holzhauer:

As you are aware, the firm has been exploring the possibility of a merger with Heller Ehrman. After careful consideration, we have decided not to pursue that course.

Heller Ehrman is a fine firm with outstanding lawyers. Like us, they have a long heritage of excellence in their work and service to clients. A merger with them would have offered potential benefits for both firms and our clients. In the end, however, various issues, including client and practice conflicts, could not be resolved, and we have ended our discussions.

Jim

Speculation has now turned to which other firms might be in the market for Heller. Orrick? Covington? Check out the comment threads for the latest and wildest rumors.

The only thing we do know for sure is that Heller has once again been jilted. We’ll bring you all of the new suitors as soon as they reveal themselves.

Mayer Brown Calls Off Merger Talks With Heller Ehrman [Law.com]

Earlier: Law Firm Merger Mania: Heller Ehrman Is At It Again