Hogan & Hartson

Hogan & Hartson Lets Go of 30 Senior Associates

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Hogan Hartson logo.jpgFirm management and rank-and-file associates at Hogan & Hartson continue to disagree about whether layoffs are taking place at the firm. Of course, as we’ve said countless times in these pages, what constitutes a “layoff” is a bit in the eye of the beholder. The overall point is that, with normal attrition down, firms sometimes have to create forced attrition, leading to involuntary departures.
Multiple sources report that Hogan just informed about 30 senior associates that they need to seek new employment. The firm’s chairman, J. Warren Gorrell, Jr., referencing the firm’s previously discussed performance evaluation system, confirmed this to ATL by email:

[W]hen senior associates are meeting our basic performance standards but are not progressing toward advancement to partnership, they are counseled to pursue other opportunities (with the firm’s help to the extent we can) if there isn’t a demonstrated need for them to continue. This conclusion was reached as to about 30 of our 140 sixth year and more senior US associates through this round of our evaluation process (this was the result of the process and not a “target” number), and they are being given four months to find new opportunities instead of our normal three month policy. None of this is a new policy, and all of it has been discussed fully with our associates.

It may be firm policy, it may be sensible, and it may not be new — but some sources aren’t happy about it. More after the jump.

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Hogan & Hartson’s Performance Evaluation System

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Hogan Hartson logo.jpg[Ed. Note: Those with cat like reflexes will remember that this post appeared briefly last night. We pulled it back to give the King of Pop his due.]
Given the times, any change to the parameters of a firm’s performance reviews are met with great trepidation by associates at the firm. The least firms can do is clearly explain that process by which attorneys will be evaluated for promotion — or termination.
Hogan & Hartson’s chairman, Warren Gorrell Jr., has been making the rounds and talking to associates about the firm’s new associate evaluation process. The plan was implemented back in April, right around the time Hogan put a number of associates on a lower billing-lower compensation track.
Gorrell told us that the meetings coincide with his communication to the Hogan associate’s committee about the firm’s quarterly partner meetings. Gorrell was able to provide us with some additional information about how associates at Hogan would be evaluated, going forward. Here is what Gorrell explained to his associates, yesterday:
Hogan Evaluation 1.JPG
That is the overview. Let’s get to what could cause a person to take an alternate “direction” in their career, after the jump.

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Nationwide Start Date Watch: Hogan & Hartson Is Moving On Back

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Hogan Hartson logo.jpgWhen firms catch a case of the economy, their illnesses often follow similar courses. They may freeze salaries. They may conduct layoffs. And the latest trendy symptom: they may push back associate start dates, the idea being that saving a couple months’ worth of associate pay will somehow shore up the firms’ balance sheets, steel them against the battering winds of the economy, and position them to be the greatest and most billingest places known to mankind, now or in the future.

Last week, Hogan & Hartson succumbed to push-back fever and joined Sonnenschein, WolfBlock, Nixon Peabody and others in the start date infirmary. Reports a tipster:

Hogan & Hartson announced on Friday that it was delaying the start date of all incoming associates to November 30. In the past, incoming associates could choose any Monday on which to start.

The firm has not yet responded to our request for comment on the start date change, but if they do, we’ll let you know.

Details of Hogan’s war against the economy and a concluding rhetorical question, after the jump.

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Hogan & Hartson Offers Buyout of 250-300 Staff

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Hogan Hartson logo.jpgMultiple sources told ATL on Friday that Hogan & Hartson would offer a buyout to 250-300 of its support staff. The firm has now had an opportunity to inform all of the personnel.

We spoke with Hogan & Hartson Chairman J. Warren Gorrell Jr. on Friday. He explained that the buyout is part of Hogan’s attempt to find solutions to the financial crisis in both a creative and sensitive manner.

Gorrell also explained the specifics of the offer. Staffers with more than five years of experience will be offered four weeks pay plus one week for every year they’ve been with the firm. For some senior people, that could end up at 20 or 30 weeks, which is considerably more than what other firms are offering displaced staff members as part of a severance package.

Tipsters weigh in after the jump.

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Updated Salary Freeze Round-up: Even More Firms on Ice

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pay freeze salary freeze pay cut law firm.jpgAs 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.

Recently announced salary freezes include “solid ice freezes” at Blank Rome and Townsend and Townsend and Crew; and “Slurpee freezes” at Bingham McCutchen, Fish & Richardson, and Texan firm Andrews Kurth.

Memorandums, as well as a new list of all firms with “solid ice” and “Slurpee” freezes, after the jump.

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Nationwide Pay Freeze Watch: Brrr! Things are getting chilly beneath the Mason-Dixon Line

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pay freeze salary freeze pay cut law firm.jpgWhile many firms announced their decisions to freeze 2009 salaries at the end of 2008, a few waited until now to make up their minds.

Memos went out before the first paychecks of the year to associates at Atlanta-based Alston & Bird and Washington, D.C.-based Hogan & Hartson. Alston’s is a Slurpee freeze with the firm saying it may “revisit” the decision at an unspecified time this year. Hogan’s is a Solid Ice freeze; salaries are locked at 2008 levels throughout 2009.

The language of these memos has become fairly uniform– a jumble of “economic downturn,” “challenging,” “distress,” and “2009 may really suck for us.” Okay, maybe not the last phrase, but that’s the gist. Check out the memos, after the jump.

We’ve also received word that Schulte Roth & Zabel has frozen salaries until further notice, but the language leaves hope for a decision in the near future for a raise:

The firm has not yet made any decision with respect to associate salaries for 2009. We expect a decision will be made in the next few weeks, and any change will be retroactive to January 1.

Not all firms are bracing themselves for a difficult 2009 by freezing salaries. In response to our requests for salary raise information, we heard back from associates at Cleary; Stoel Rives; Perkins Coie‏; Fried Frank; Irell; and Schiff Hardin. A host of others are named in Firms that have not frozen, a post in the ATL Community section.

Memos from Alston, Hogan, and Schulte about frozen salaries, after the jump.

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Associate Bonus Watch: Hogan & Hartson Keeps D.C. Interesting

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law firm associate bonus watch 2008 biglaw bonuses.jpgAfter spending some quality time with Stephen Hawking and an abacus, we are now ready to report the bonus associates at Hogan & Hartson will be receiving this year.

For the firm’s offices in D.C., Baltimore, Philadelphia, and Northern Virginia the scale is as follows:

2002 and above – $7,500 to $37,500
2003-2005 – $7,500 to $25,500
2006-2007 – $7,500 to $20,000

The difference between a $7,500 bonus and a $37,500 bonus is huge, so we delved a little deeper into how Hogan comes up with the cream of the bonus crop. As you might expect, hours play a significant role. A tipster with a firm grasp of multivariable calculus (and, you know, basic arithmetic) explains:

Hogan actually has a fairly unique compensation scheme. there are two different salary tracks – one for associates who intend to bill 1800 hours and another for those who bill 1950 (at which level you make the market salaries). I think the 1800 track salaries are somewhere in the neighborhood of 15K less and are designed so that the firm can pay our low-billing regulatory associates less money – and as it turns out this year, a bunch of corporate associates too.

We crunch more numbers after the jump, and there’s 2009 Hogan salary update as well.

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Crisis for some firms, opportunity for others

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good news bad news.jpgIt’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

Legal Eagle Wedding Watch 8.24: Herb-al Essence

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champagne glasses small.jpgAs we expected, celebrity professors Cass Sunstein and Samatha Power were the winners of last week’s July Couple of the Month voting, running away with over 60 percent of the vote. Congratulations to this nerdy-hot duo!
This week’s set of contestants might be the strongest we’ve seen this season. Their write-ups feature five Harvard degrees, a Rhodes, and one of Biglaw’s most exalted surnames. Here are the names of the newlyweds:

1. Geneviève Treuille and Daniel Wachtell

2. Melissa Langsam and Todd Braunstein

3. Amanda Schwoerke and Stephen Sachs

Read more about these couples — and see their pictures — after the jump.

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Fall Recruiting Open Thread: Vault 21-30 (2009)

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comparing.jpgIn connection with on-campus interviewing season, we’re giving you a chance to assess the firms that made this year’s Vault 100 list of most prestigious law firms. The previous open threads listed firms in groups of five, but to up the pace, we’ll list them by ten from here on out. Here’s the next group, with prestige scores in parentheses:

21. O’Melveny & Myers LLP (6.815)
22. Clifford Chance LLP (6.772)
23. Jones Day (6.763)
24. Morrison & Foerster LLP (6.657)
25. Hogan & Hartson LLP (6.579)
26. Linklaters (6.574)
27. Milbank, Tweed, Hadley & McCloy (6.512)
28. Ropes & Gray LLP (6.501)
29. Mayer, Brown, Rowe & Maw LLP (6.494)
30. Paul, Hastings, Janofsky & Walker (6.481)

We note Magic Circle firm Linklaters making a big leap from the high 30s in the 2008 list to #26 this year — perhaps because its “notable perks” include group retreats to Europe, a drinks trolley, and an on-site doctor and dentist.
Compare. Contrast. Discuss. Thanks.
Earlier: Vault 100 Open Threads – 2009

Associate Bonus Watch: A Pre-Holiday Round-Up

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associate bonus watch 2007 law firm Above the Law blog.jpgLet’s send you into the holiday weekend with some associate bonus news. Here are some law firm bonus announcements that haven’t been previously covered in these pages.
(Firms that previously announced their bonuses, but are being sneaky about the exact amounts and/or the percentage of associates getting them, will be addressed separately. This post is for completely new announcements.)
Some of this news is incomplete. If you can provide more details, please email us. Thanks.
1. Akin Gump (New York): Year-end bonuses, and special bonuses to “those associates and counsel who have performed in accordance with the Firm’s expectations regarding productivity, quality of work and Firm citizenship.” Plus “discretionary merit bonuses” to associates and counsel “who performed in a truly exceptional manner.”
One source at the firm characterizes it as follows:

Full match in NY, with extra bonuses in certain cases (generally to billers over 2400). There has never been an hours requirement, so if past practice is any indicator, anyone not being fired will get it.

Full memo, after the jump.
2. Akin Gump (outside New York): Each associate is allowed to make the case to the firm for a big bonus. A source tells us that this practice of asking associates to write up memos to justify their bonuses started a few years ago. “I wonder how this plays into the current bonus climate, or if anyone else has to do this.”
3. Hogan & Hartson (outside New York): The 2007 bonus memo appears after the jump.
4. Hogan & Hartson (New York): We’ve confirmed the fact that Hogan announced bonuses in New York. It was described to us as a market match. But we haven’t seen a memo or the fine print of the announcement, so we can’t confirm that.
Update: The bonus memo for Hogan & Hartson’s New York office appears after the jump.
5. Vinson & Elkins (New York): “V&E matched the New York market bonus (including this year’s special bonus) for its New York associates, to be paid on January 15, 2008. No memo yet, a voicemail.”
6. Sheppard Mullin: Details after the jump.

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Those Weird Hogan & Hartson Ads: The Mystery Revealed

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Hogan Hartson LLP Above the Law blog.JPGRemember those strange radio advertisements about Hogan & Hartson? We discussed them here and here. The ads went something like this:

Did you hire a Hogan and Hartson senior partner for bet the company liltigation? Was your case handled by a junior lawyer instead of the senior partner you thought you were paying for? Call 800-759-8611.

Well, Peter Lattman and the WSJ Law Blog have gotten to the bottom of this oddness. It turns out the ads, which ran in print as well as on the radio, were financed by a company called General Steel. Earlier this year, General Steel sued Hogan, alleging fraud, breach of fiduciary duty and breach of contract. From the Law Blog:

In July a judge in Denver dismissed all but one of the claims against Hogan and sent the remaining claim — essentially a fee dispute — to arbitration. Hogan says General Steel owes the firm around $300,000; General Steel wants its money back and more. Click here for the judge’s order; and here for the judge’s order denying General Steel’s motion for reconsideration. General Steel is also appealing the judge’s ruling.

Hogan & Hartson says it’s not surprised by the Times ad, which has also run in D.C. newspapers (and on the radio). During the settlement negotiations, Hogan says that Knight had threatened a “shock and awe” campaign against Hogan if it didn’t pay General Steel money to settle its claims.

We are “shock[ed] and awe[d]” — by the tackiness of General Steel. If we’re ever in the market for prefabricated commercial steel buildings, they’re definitely not getting our business.
Hell Hath No Fury Like a Dissatisfied Hogan & Hartson Client [WSJ Law Blog]
Earlier: Remember Those Weird Radio Ads Mentioning Hogan & Hartson?
Lawsuit of the Day: Have You Been Injured… By Hogan & Hartson?