What role do lawyers have in advising their clients on business matters? Some might say: None.

“The client decides on the business objective, and the lawyer helps the client reach that objective, as long as it’s legal,” this line of thinking goes. “And why would you want lawyers giving business advice anyway? They have no business training — and judging from how large law firms have fared in the Great Recession, they don’t seem to be particularly good at business either.”

On the other hand, one thing we commonly hear from the in-house lawyers we speak with is that they do give a combination of legal and business advice (not surprising, given that they have one client, which they want to see prosper). And some top law firm lawyers also get involved in the business side of things; they’re dealmakers in their own right, not just the folks who “paper up” the deals dreamed up by investment bankers. E.g, H. Rodgin Cohen of Sullivan & Cromwell, who played a major role in various bank M&A deals last fall.

Fried Frank partner Jonathan Mechanic (pictured) — chair of that firm’s high-powered real estate group, with a top ranking from Chambers and Partners — is arguably the real estate world’s answer to Rodge Cohen. In the New York Observer, Dana Rubinstein began an August 2008 interview with Mechanic by citing a study declaring him to be “the best-connected and most powerful real estate lawyer in the world.”

But at least one ATL reader holds the opinion — a minority opinion, it should be noted — that Jon Mechanic’s track record isn’t so stellar.

The bill of particulars against Jon Mechanic and Fried Frank, after the jump.

As we roll through the next segment of the 2010 Vault rankings, we get into some firms that have been caught testing the stealth layoff waters. To refresh your memory, here is the next list of firms:

31. Milbank Tweed Hadley & McCloy
32. Paul Hastings Janofsky & Walker
33. Akin Gump Strauss Hauer & Feld
34. Fried Frank Harris Shriver & Jacobson
35. Winston & Strawn
36. Allen & Overy
37. Willkie Farr & Gallagher
38. Freshfields Bruckhaus Deringer
39. Baker Botts
40. Munger Tolles & Olson

Check out the big move by Munger. It’s up 11 spots on this year’s list. And let’s not forget about the firm’s #1 A-List ranking by Am Law earlier this year. Munger’s managed to do all of this without laying off a massive number of associates. Hopefully other Biglaw firms (and current 2Ls) will take note.

We know people have strong opinions about some of the firms on this list. Let’s get into them after the jump.

Late last week, we told you that bad things were coming down the pipe at Fried Frank. This morning, the firm announced that 99 people will be let go:

Effective today, we are implementing changes that will result in an overall reduction of 41 associates and 58 administrative staff from our U.S. workforce. This decision is one we worked very hard to avoid. But we must respond responsibly to the current environment. We would like to express our appreciation to everyone impacted by these decisions for all they have done for our Firm and our clients.

The economy is so bad that even firms that “don’t do lawyer layoffs” are having to do lawyer layoffs.

It’s not even surprising anymore that the firm is deferring all incoming first-year associates to January 2010. Fried Frank is also following the trend of asking associates to defer until the fall of 2010:

Additional steps announced today pertain to our fall 2009 class and our 2009 summer associate programs in the U.S. The start date of our fall 2009 class has been deferred to January 28, 2010. All incoming associates whose start date is deferred until January 2010 will receive a $10,000 stipend. We are also offering an opportunity for members of the fall 2009 class to defer until the fall 2010. We are encouraging those associates to develop their legal skills by pursuing a public interest or government position or by volunteering with a legal, political or community-based organization. Those who elect this deferral will receive a stipend of $70,000 plus health benefits.

And Fried Frank is cutting its summer program from 12 weeks down to 10.

Ninety-nine layoffs. Shortening of summer programs. Deferral of incoming associates:

I don’t like,
I don’t like,
I don’t like Mondays.

Read the full memo after the jump.

As many of you know, reporting on Fried Frank can be difficult. Fried Frank has gone the “stealth layoff” route in the past, because “Fried Frank doesn’t do lawyer layoffs.”

Nonetheless, we’ve gotten a number of tips over the past few days that something is going down at Fried Frank this week. It’s just that nobody knows precisely what that something is, at least not yet.

What we do know is that there was an all partner meeting yesterday. The billing code given to the conference room booking was the “Office of Attorney Development.” Anybody want to offer a guess on exactly what kind of career development the partners were contemplating?

We also understand that Fried Frank is having a partnership vote today. One source says that the vote is on whether the firm should offer an incoming associate deferral program.

That is a lot more promising than what some of our other sources think. More from our tipsters after the jump.

As many of you know, part of the problem firms are facing during these challenging times is that clients won’t pay their bills. Lawyers can’t get paid unless clients pay.

Whether or not clients are willing or able to pay, it certainly won’t happen unless they are billed. Hence, as most associates already know, the days of delinquent time entry are at an end.

But Fried Frank is taking it to a whole new level. Instead of making sure your time is up to date every month or every couple of weeks, Fried Frank wants attorneys to accurately close out their time every single day. This is from a firm-wide memo that went out last week:

The importance of accurately billing and recording time - both from an economic and an ethical standpoint - cannot be overemphasized. Accuracy is essential both for the Firm and its clients. To ensure accuracy, it is Firm policy that attorney time must be entered and released on a daily basis. This memorandum covers the Firm’s current client billing policies and guidelines.

Most of Fried Frank’s billing policy is pretty standard and common sense stuff (you can download the full policy after the jump). But there are some significant changes.

Layoffs and stealth layoffs are only stage 1. Stage 2 is lawsuits. We’re not sure if Stage 3 is profit, but we are very sure about Stage 2. We’ve mentioned before that we expect to see a lot of litigation surrounding all the firings happening in the legal industry. It’s already happened to Skadden, now it is happening to Fried Frank.

AmLaw Daily reported this morning on an employment discrimination complaint that was filed against Fried Frank:

A former litigation associate at Fried, Frank, Harris, Shriver & Jacobson has filed a complaint against the firm with the U.S. Equal Employment Opportunity Commission, claiming the firm denied her partnership because she is openly gay before firing her after a mediation last month.

The associate in question, Julie Kamps, sent her EEOC complaint into Above the Law. It is pretty bare bones. She claims that she was subjected to discrimination and harassment during her ten year tenure at Fried Frank. She was fired on January 30th, 2009.

We’ve reported on stealth layoffs at Fried Frank back in November and December. But we didn’t know that layoffs were still happening in the new year.

Kamps gave an interview to AmLaw where she stated the the discrimination began in 2006:

In an interview, Kamps tells The Am Law Daily the mistreatment began sometime in 2006 but got worse this fall. She says the firm began taking work away from her, leaving her with nothing to do. She declined further comment on the exact nature of the harassment, saying it would become public when the case goes forward.

Are you wondering what a “non-gender-conforming” stealth layoff looks like? Read the complaint after the jump.

After stealthily laying off at least 30 associates, the Fried Frank bonus announcement should come as no surprise:

Nobody expected Fried Frank to break into Skadden territory on bonuses. But at least there is a nod towards the reason for paying the low-end bonuses championed by Cravath:

Current global economic conditions have presented new challenges for our clients and your contributions play an important role in our ability to work together to meet these challenges.

Let’s close off the Fried Frank loop after the jump.

… And now back to our regularly scheduled programing …

We are now able to report that at least 15 litigation associates at Fried Frank have been laid off in the past week.

At least 15 litigation associates, but the numbers could be higher. Multiple tipsters report that there are many “skeletons” in the Fried Frank closet right now.

Over a week ago, we reported that 15 corporate associates had been let go. At that time, we also said that the number of corporate layoffs could be higher than 15. We’ve received information since then that more than 15 corporate associates were laid off, but we can’t get a handle on the true number. So, conservatively speaking, we’re reporting 30 associates that have been let go from Fried Frank over the past two weeks.

More about Fried Frank’s layoffs after the jump.

We’ve gotten credible information that Fried Frank has laid off at least 15 associates from their corporate department, including 6 in the real estate practice group. A tipster collects the information in a clear way:

They are veiled as performance-based reviews, but virtually everyone is getting a negative review (mostly, it seems, to justify in a paper-trail [a decision] to not give bonuses)….

There has been no formal review process announced, and no one knows what directive came from management last weekend at the partner retreat, but it seems that each group was told to make cuts. People were completely taken off guard when they started getting calls earlier in the week calling them in for their reviews, some of which dredged up years-old information to use as justification for lay-offs, and many of which lasted only 5 minutes or so. Most of the layoffs have been mid-level associates and up, but most junior associates have not yet been reviewed.

The axe is expected to fall on the litigation side of the firm today.

The firm has not responded to voice messages or emails left earlier today. The number of layoffs could be higher than what we are reporting, but right now the best number is 15.

We understand that a three-month severance package has been offered.

Every single tipster (and there are a lot of them) said that the laid-off attorneys were told that they were being let go for performance reasons.

But that’s not all they were told. Read the rest, after the jump.

Given the list of associate “perks” firms could be cutting back on during these tough economic times, the latest news from Fried Frank seems very reasonable. Associates at Fried Frank were told today:

Dear All,

In light of continued turmoil in the financial markets and the wider economy, and the effect it is having on so many we know, we think it is not appropriate to host Firm holiday parties this year.

The Firm has a strong platform and business with which to succeed in this very demanding business environment and continues to be involved in many interesting and challenging matters for our clients. Instead of the parties, the Firm will be making charitable contributions to certain organizations who rely on donations during the holiday season to accomplish their purpose during this time of year and which are feeling the effects of the slowdown in the economy.

Thanks very much.

Valerie Jacob and Justin Spendlove

Despite the success of last year’s bash at Cipriani on Wall Street, this would seem to help associates in two ways. It saves the firm money — without firing anybody. That is an unqualified good.

But also: who enjoys the firm holiday party anyway? It’s just an opportunity for associates to get too drunk and do something colossally stupid that will no doubt end up on Above the Law. (Please don’t cancel the holiday party Mr. Fried and Mr. Frank!)

Seriously though, saving a bit of cash is a good thing for associates. And not for nothing, but giving some extra money to charities during what is sure to be a terrible season for charitable donations is really a great thing to do. During times of economic recession people tend to give less, precisely at times when charities need more.

But it might not be all Salvation Santas at Fried Frank this winter. More after the jump.

Welcome to another post in the 2009 Vault 100 open thread series. You all seem to like having the law firms listed in groups of ten, so we’ll keep it up. Here are the thirty-something firms from the Vault 100, with prestige scores in parentheses:

31. Fried, Frank, Harris, Shriver & Jacobson LLP (6.461)
32. Freshfields Bruckhaus Deringer LLP (6.327)
33. Akin Gump Strauss Hauer & Feld LLP (6.313)
34. Winston & Strawn LLP (6.275)
35. Quinn Emanuel Urquhart Oliver & Hedges LLP (6.235)
36. Willkie Farr & Gallagher LLP (6.174)
37. Orrick, Herrington & Sutcliffe (6.173)
38. Allen & Overy LLP (6.147)
39. Cadwalader, Wickersham & Taft (6.131)
40. Proskauer Rose LLP (6.102)

Fried Frank and Cadwalader have been on the ATL radar of late. We broke news of staff layoffs at Fried Frank earlier this week, and news of the attorney bloodletting at Cadwalader last month. As noted in Cadwalader’s notable perks: “ouch, layoffs.” (Speaking of, in going through the Vault 100 list, we’ve discovered that Vault’s definition of “perk” is very different from ours.)

In the comments, the curious can pose questions, and the insiders can share insights. More threads to come.

Earlier: Vault 100 Open Threads - 2009

As promised, we bring you an update on yesterday’s coverage of staff layoffs at Fried Frank. Here are a few additional details, from the National Law Journal (subscription):

Fried, Frank, Harris, Shriver & Jacobson is reducing administrative staff in New York and Washington. The reductions, which a firm spokeswoman said were less than 10% of the law firm’s 730 staffers firmwide, affect primarily floating secretaries, part-time assistants and paralegals and library personnel.

The layoffs, first reported on AboveTheLaw.com, resulted from the law firm’s review of its administrative resources and staffing requirements. The employees will receive severance packages based on years of service, the spokeswoman said.

Update / Correction: One source questions the claim that the layoffs affected “primarily” floaters and part-time assistants. According to this tipster, many of the laid off employees were full-time, senior secretaries — a number of them over 50, and some just a few months shy of getting their pensions. This source predicts that age discrimination lawsuits will be filed.

One tipster tells us the number of affected employees was in the range of 50 to 60, which would amount to under 10 percent of 730 staffers, and that severance amounted to one week of pay for every year of service. We also hear this:

Apparently, mail room, duplicating and facilities were told that their jobs were being outsourced by the end of the year. They could start looking for new jobs before getting laid off at the end of the year or apply with the outsourcing agencies (with no guarantees of a job or placement at Fried Frank).

New York staff were given “a few minutes to pack up and get out”; cars were provided to take people home (a nice touch — hopefully that will become “market”). One source claims that employees were laid off without regard to their seniority or their performance reviews, whether negative or positive.

What about attorneys? A spokesperson emphasized to us that Fried Frank “doesn’t do lawyer layoffs,” which was reiterated to associates by firm chair Valerie Ford Jacob at a meeting yesterday.

(Jacob also claimed that the firm has never laid off lawyers. But one source at FFHSJ begs to differ. This source claims that the firm laid off attorneys back in 1990, and then “suffered years of recruiting problems because of it,” which may explain its reluctance to go down that path today.)

More detail about the meeting, after the jump.

Last week we started hearing rumors of imminent staff layoffs at Fried Frank. The rumors have now come true, as we’ve been hearing from multiple sources. Today appears to be the big day.

We submitted an inquiry to the firm. A spokesperson issued the following statement:

Over two years ago Fried Frank began a review of its administrative resources and staffing requirements. As part of this review process some departments were expanded and others consolidated.

Today’s administrative staff reductions are part of that business review process. Those affected are in the Firm’s NY and Washington DC offices. Severance and career counseling were offered to all of those affected.

We aren’t sure of the numbers (and the firm has not yet responded to our request for that data). One of the rumors from last week said the number could be as high as 10 percent of total staff headcount. We hear that in the D.C. office, at least eight or nine people have been laid off, as of the time of this posting. The numbers in New York are said to be significantly higher than in Washington.

The affected employees include secretaries, paralegals, and library personnel. Severance packages appear to vary, from as low as seven weeks to as high as three months.

People are being called in and given the bad news individually. But meetings are also being held at 3:30 and 4:00 p.m. in D.C. (It’s not clear what New York is doing.)

One staffer in New York was given 30 minutes to pack up all belongings and leave the premises. In Washington, however, that’s not happening; one source describes that office as “more humane.”

We will bring you more information as the story develops. If you have information to share, please email us.

* Why does Wall Street get all the juicy scandals? We’re jealous of our DealBreaker colleagues. [Dealbreaker]

* Larry Ribstein’s take: “it’s hard not to think that it’s really all about dispute a few weeks ago between [the NYT’s Andrew Ross] Sorkin and Dealbreaker’s John Carney.” [Ideoblog]

* Are you in the top one percent of U.S. taxpayers ranked by adjusted gross income? And which states are home to the richest of rich taxpayers? [TaxProf Blog]

* “Would you trust a law professor to be President?” [Althouse]

* Speaking of law profs, they may boycott the annual AALS meeting, due to the hotel owner’s opposition to same-sex marriage. [National Law Journal via TaxProf Blog]

* An interesting interview of Fried Frank partner Jonathan Mechanic, a superstar of the real estate bar. [New York Observer]

* Russian judge: “If we had no sexual harassment we would have no children.” [Telegraph (U.K.)]

While we continue to update our ATL / Lateral Link tables on clerkship bonuses and signing bonuses and bar exam fees, a few of the clerks I have been working with lately have asked an interesting, but often critical question: “Do I have to give it back if I leave?”

Update: This survey is now closed. Click here for the results.

In the meantime, a quick shout-out to two firms making nice strides lately: Hogan & Hartson now offers a $50K clerkship bonus in all of their offices, and Fried Frank has increased their paid maternity leave to 18 weeks.

Both of our running tables have now been updated to reflect the good news.

—
Justin Bernold is a Director at Lateral Link, the sponsor of this survey.

It’s not as lavish as holding your law firm retreat at the Ritz in Pasadena, like O’Melveny & Myers. Nor is it as exotic as an all-expenses-paid trip to Jamaica, like Boies Schiller.

But still, this is neat. From a Fried Frank source:

Fried Frank announced to its associates on Tuesday that it is sending all associates in their third year and above, plus some partners and special counsel, to New Orleans for its 2008 attorney retreat. I thought this was pretty cool of the firm to do, especially because there’s a mix of fun, workshops that sound useful, and community service to help the residents of New Orleans.

A cynic might say that the last thing a devastated city needs is to be descended upon by a bunch of lawyers (a la Bhopal). But between the tourism dollars they’ll bring in and the volunteer work they’ll perform, the arrival of the Fried Frank folk is clearly a good thing. John Edwards, eat your heart out.

Announcement memo, after the jump.

Our latest column for the New York Observer addresses a seasonal subject: law firm holiday parties. Here’s the opening:

Law firm holiday parties aren’t what they used to be. In bygone days, the booze-fueled blasts yielded up tales of M&A lawyers making out with each other in darkened corners, partners dancing drunkenly with paralegals young enough to be their daughters and similarly dubious behavior.

In recent years, however, stories of scandal have become less common. Perhaps guests are more afraid of public embarrassment, now that cellphone photos of carousing legal eagles can be uploaded to the Internet in minutes….

But even if they’re not as wild and crazy as they used to be, law firm holiday parties still reflect, in ways large and small, the cultures and personalities of the firms throwing them. Let’s have a look, shall we?

You can read the rest of the column — which describes the December festivities of Wachtell, Cravath, Sullivan & Cromwell, Skadden, Cadwalader, and Fried Frank — by clicking here.

Boogie, Counselor! Which Law Firm Gives the Best Party? [New York Observer]

Fried Frank has announced year-end and special bonuses for its associates and special counsel in its New York office. The numbers are consistent with those previously announced by other firms.

But whether this is a true market match is unclear, since the firm is a bit vague with respect to what percentage of associates will receive “special” bonuses. From the memo: “We will also be paying a one-time special bonus to associates on a discretionary basis based on performance…”

Read the full memo, after the jump.

We think this latest Vault 100 law firm thread will be a good one. Here are the five firms now on the table for discussion (in Vault 100 order, with prestige scores in parentheses):

26. Cadwalader, Wickersham & Taft (6.648)
27. Hogan & Hartson LLP (6.622)
28. Mayer, Brown, Rowe & Maw LLP (6.615)
29. Fried, Frank, Harris, Shriver & Jacobson LLP (6.588)
30. Ropes & Gray LLP (6.566)

We expect (formerly bedbug-infested) Cadwalader to generate a fair amount of discussion, since we hear associate morale over there ain’t so hot. Consider this comment, from the morning’s open thread on happy hours:

At my anonymous law firm they pour water in a trough and hang a feed bag in a conference room daily, they then ring a bell and let us know we have 2 minutes to eat and drink before we must get back to work … Man, I love working at Cadwalader… Oops.

And we also expect interesting stuff about Mayer Brown. From a tipster:

Would you consider running a piece on the troubles at Mayer Brown? You’ve already reported on their partners being fired/leaving, the Refco mess, and their unhappy associates. I think some open speculation on where their firm is going would be very enjoyable at this point.

So have at ‘em, in the comments. Thanks.

The Vault Top 100 Law Firms [Vault]

Earlier: Vault 1-5; Vault 6-10; Vault 11-15; Vault 16-20; Vault 21-25

Here at Above the Law, we’re committed to exploring the (sometimes harsh) realities of Biglaw life. One of those realities, of course, is timekeeping. That’s when you sit down and realize that, despite spending twelve hours in the office, somehow you only got eight hours of work done (maybe ‘cause you spent too much time reading Perez Hilton and gossiping with your officemate about Project Runway).

Anyway, one curious reader emailed us:

Just wanted to see if there was any interest in seeing what large firms across the country’s policies were for timekeeping (daily, weekly, monthly) and what the penalties were for falling behind. I had heard that one firm withholds paychecks after enough time.

Funny you should ask! A second reader sent us this tip:

The abysmal associate morale at Fried Frank will not be improved by a new mandate to close out all time in full by the next business day or face sanctions.

Wow, that’s a harsh policy — but it’s true.

Check out the memo, and discuss your own firm’s policies on entering your hours, after the jump.