Last month, we informed you about positive developments at Milbank Tweed Hadley & McCloy. These included enhanced parental leave and a promise of no associate layoffs. In a bit of positive publicity for Milbank, whenever a rival firm announces a no-layoffs policy -- e.g., Latham -- it's described as making "the Milbank promise."

But not everything is hunky-dory over at Milbank. We hear that, earlier this month, the firm laid off the entire group of staff attorneys. It appears that the "Milbank promise" protects partnership-track associates, but does not extend to staff lawyers. (Shhh, don't tell Yolanda Young....)

We wondered whether perhaps it was just a case of contract lawyers whose project was finished being dismissed because their work was done. But a source explained this was not the case:

Milbank has a staff attorney program, much like Skadden or Simpson, where they have a group of permanent employees engaged in e-discovery, doc review, etc for the litigation department. Staff attorneys are not hired to work on a specific case like a contract attorney. They get assigned to various matters, and once they finish, get assigned to new ones, much like associates.

In other Milbank news, we hear that their summer program has been capped at 12 weeks. But considering that there are only so many weeks in a summer, and that some firms -- e.g., Pillsbury Winthrop -- are going as low as 10 weeks for summer 2008, this doesn't seem like a big deal.

A Milbank spokesperson did not respond to multiple inquiries about either the staff attorney or summer program news.

Update / Correction: This post is the subject of a correction. Please see here.

Earlier: What's Up at Milbank Tweed?

McDermott, Will & Emery has come up with a more creative way to deal with soaring associate salaries. The firm has announced that it will be creating a "second tier" of associates to deal solely with low-level tasks like, e.g., document review.

As Cal Law points out, hiring cheaper lawyers to do this type of work is nothing new; this type of stuff is the staple of contract attorneys in most biglaw firms these days. The new part is making these contract attorneys a lower class of associates, essentially making them "permanent contract attorneys", as Cal Law puts it:

While some firms quietly turn to contract attorneys, or even ship grunt work overseas, McDermott, Will & Emery plans to create a new tier of attorneys — think of them as permanent contract associates — to handle lower-end tasks at lower billing rates.

...

First-year associates at big firms now earn $160,000. Meanwhile, electronic discovery has dramatically increased the amount of basic work that usually goes to those high-priced associates.

"This is a topic of great importance, since the cost of document review has become intolerable for everyone," said David Balabanian, the head of Bingham McCutchen's litigation group.

While hiring contract attorneys is nothing new, creating a second class of full-timers is.

[The Recorder via Cal Law]

Is this a good or bad thing? On the one hand, it increases the competition even more for the "real associate" positions and institutionalizes to an even greater extent the law school tier system into biglaw law firms.

On the other hand, it may be beneficial to those attorneys now doing the contract work. It will establish them as associates in the firm, even if not on the same level as the top tier associates. They will likely receive things like benefits. The top tier associates will likely do more substantive work sooner. And the clients won't find themselves paying top tier prices for stuff like document review, as still occasionally happens.

So what do you guys think? Will other firms adopt this model? Once again, it makes sense to us.

And hey, L2L, maybe you should apply.

Related:
Firm to Fill Cheap Seats [The Recorder via Cal Law]
McDermott To Create a New Class of BigLaw Attorneys [WSJ Law Blog]

Tomorrow is a very big day for almost 20 California lawyers. From Blogonaut:

A federal district court has ordered 14 California lawyers to explain why they should not be sanctioned for their “exceptional misconduct” on behalf of Qualcomm in a lawsuit that the San Diego wireless company lost. All of the lawyers subject to the order were from the Cupertino law firm of Day Casebeer Madrid & Batchelder or the Heller Ehrman law firm's offices in Menlo Park and San Diego, the San Diego Tribune is reporting.

Five additional lawyers have been drawn into the proceedings since the order was issued, so the fate of 19 attorneys rests on the outcome of an October 12, 2007, 9:30 a.m. hearing before U.S. Magistrate Barbara Major, the newspaper reports.

We previously wrote about the underlying discovery snafu over here.

Both Heller Ehrman and Day Casebeer have been the subject of gossip recently. Last month, Heller Ehrman was rumored to be carrying out staff layoffs in California (believed to affect up to 90 people). If you know anything about this, please email us.

Update: Oops, sorry, don't know how we missed this article from The Recorder, reporting on Heller axing 65 administrative staff positions nationwide. No attorneys were laid off.

As for Day Casebeer, rumor had it that they were rescinding offers to incoming associates. But it appears that this was inaccurate, as rumors sometimes are. When we contacted the firm, they had this comment:

We are delighted that eight new associates will join us this Fall and that two have already started work. It's a record class for us. Far from rescinding any offers, we remain very interested in resumes from others interested in joining our practice.

Especially if you're experienced in electronic data discovery.

Federal Court Brings Written Charges of “Exceptional Misconduct” Against 14 Lawyers [Blogonaut]
19 lawyers face sanction hearing [San Diego Union-Tribune]
Recovered Emails Bedevil Qualcomm in Court [Wall Street Journal]
Heller Says Slowdown Not Behind Layoffs [The Recorder via Law.com]

Earlier: Benchslap of the Day: The Qualcomm Debacle

If so, then Uncle Sam wants you. The feds need your valuable skills -- badly.

First the Department of Justice produces original documents, instead of copy sets, to Congress. And now, the AP reports on a screw-up by the FTC:

Lawyers for the FTC electronically filed documents as part of [its] court case [challenging the Whole Foods purchase of Wild Oats] yesterday afternoon. Court officials realized the redacted portions of the document could easily be read and blocked it from being downloaded from court computer servers. The Associated Press downloaded the document from the public server before it was replaced by a properly redacted version.

In the original version, the words looked redacted but were actually just electronically shaded black. The words could be searched, copied, pasted and read. The second version of the document was filed using scanned pages of the redacted documents. There is no way to remove the blacked-out portions from the final copy.

In a statement late Tuesday, Whole Foods said it was investigating the "apparent improper release by the Federal Trade Commission of confidential proprietary business information."

So bite your tongue next time you want to dismiss document production as mindless drudgery. If the DOJ and the FTC can't get it right, surely there must be SOME skill involved, right?

Error by FTC Reveals Whole Foods' Trade Secrets [Associated Press]

Earlier: Earth to DOJ: Document Production Isn't That Hard

We've been doing a lot of Biglaw coverage lately. But since Attorney General Alberto Gonzales is being raked over the coals as we type, in an appearance before the House Judiciary Committee, let's take a timely detour into the U.S. Department of Justice.

The DOJ isn't looking terribly competent right now. And this latest story won't burnish their reputation. From a tipster:

As you know, the Justice Department produced a number of documents to Congress, concerning the controversial U.S. Attorney firings. These document productions have not been huge -- maybe just a few thousand pages. Nothing like what you see in major commercial litigation.

One such document production showed up on Capitol Hill, in four sets: two sets for the Senate Judiciary Committee (Democrats and Republicans), and two sets for the House Judiciary Committee (Democrats and Republicans). The production arrived on a weekday evening.

A Republican staffer immediately started looking through the production. The staffer noticed that the produced documents didn't have Bates stamps on them. Oops. Guess the DOJ forgot to have them stamped -- a screw-up, although not a cardinal sin.

A few pages later, the staffer noticed something else, on a document with redactions on it. There was redacting tape that was STILL ON THE DOCUMENT. One could access the redacted, privileged material simply by peeling off the tape.

Holy crap. Instead of sending over Bates-stamped photocopies, the DOJ had produced its ORIGINAL DOCUMENTS to the Congress.

Nice. Apparently the Justice Department is less competent than a second-year litigation associate: they can't do a proper document production.

It gets worse. More after the jump.

More legal troubles for controversial celebrity gossip blogger Perez Hilton, aka Mario Lavandeira. The latest lawsuit against him, filed by Universal City Studios, asserts copyright infringement, arising out of Lavandeira's publication of a topless photograph of Jennifer Aniston (taken from allegedly stolen footage from "The Break-Up").

The complaint is fairly straightforward. The most amusing part of the filing is an exhibit to the complaint: the topless Jennifer Aniston pic, with a strategically situated "Redacted" stamp:

During our time in commercial litigation, we got to know the "Redacted" stamp very well -- perhaps too well. But we never saw the "Redacted" stamp used in quite such an interesting way.

We suspect that the Court will order an in camera examination of the unredacted photograph. Especially if the case winds up before Judge Manuel Real.

Lawsuit Over Topless Aniston Photo [The Smoking Gun via Drudge Report]

Not sure how we feel about this development:

For years, outsourcing has been a dirty word inside the world of white-shoe law firms.... A number of large law firms, though, are starting to tiptoe onto far-flung shores.

The latest is Clifford Chance, one of the largest law firms in the world with 29 offices in 20 countries, which will announce plans today to consolidate and move big chunks of its administrative functions like accounting and technological support to an operation in Delhi, India, by next spring.

Ah yes, Clifford Chance -- already renowned for its spectacular associate morale.

We're sure CC associates will love it when their computer freezes up at 2 a.m. the night before a closing, they call the dubiously-named "Help Desk," and they spend 45 minutes trying to explain the problem to an Indian woman who insists that yes, she really IS named "Rhonda."

On the other hand, outsourcing all boring tasks could be good for law firm associates over the long term. Can Bangladeshis be trained to conduct due diligence?

Law Firms Are Starting to Adopt Outsourcing [New York Times via How Appealing]
Outsourcing: Everybody’s Doing It, Even Law Firms [WSJ Law Blog]
Clifford Chance LLP: Associates' Concerns [Internal Memos]