In journalism, there are certain go-to stories that one writes around big events. At Halloween, everyone writes the “most popular costume” story. At Christmas, it’s the “most popular toy” story. At Thanksgiving, it’s the “how the community is giving back” story.
Over the last two years, a recurring event has been “the big bankruptcy.” And it seems that the journalistic go-to is the “how much are the greedy lawyers making off of this” story. We’ve seen it with the GM bankruptcy, the Tribune bankruptcy, and the Chrysler bankruptcy. Yesterday, the New York Times applied the story model to the Lehman bankruptcy, but they got pay czar Kenneth Feinberg to weigh in — and lay into the firms working on the case: Weil, Jones Day, and Milbank.
“It violates any sense of proportion,” says Kenneth Feinberg, the Washington lawyer who serves as the “pay czar” for banks bailed out by the government and whom the court appointed last June to monitor fees associated with the Lehman bankruptcy. The court asked him to participate after concerns were raised in the news media about the soaring fees in the Lehman case.
“Unemployment is over 9 percent, and to be paying first-year associates $500 an hour angers the public,” he observes. “People read about all of this and say that lawyers and the legal system are one more example of Wall Street out of control.”
The article outlines the fees that have outraged — tangential Nationwide Perk Watch: Weil attorneys get limo transport — and the new limits that have been placed on bankruptcy attorneys on the case. No first class for you!
We’ve devoted a lot of coverage to the NALPguidelines regarding summer associate hiring. At the beginning of the recruiting season, I suggested that the NALP guidelines were so toothless that law students should disregard them, just as the law firms have done. During the fall recruiting season, Sullivan & Cromwell was eager to ignore NALP, and they were stopped only by collective law school action, inspired by Harvard Law School.
After a second consecutive year of nobody being happy with the NALP guidelines, in January the organization finally indicated that it might change things up before the next recruiting season. The core of the proposed new program would be to set a date before which firms could not extend offers to potential summer associates. At the time, I was unimpressed:
I don’t know. Increasingly, I’m of the belief that the old system just needs to be blown up and a new one should be built from scratch. How can a firm make a realistic hiring decision nearly two years in advance based on one year of law school? How can a law student make an informed choice when firms straight-up lie to them?
We now know that my lack of confidence in NALP’s new proposals was nothing compared to what they were feeling at Jones Day. The firm has been all over the web today, making it known that it’s not at all impressed with NALP or the new proprosed guidelines, which it perceives as anti-competitive.
We like to keep track of “new partner” announcements here at Above the Law (under our “New Partner Watch” feature). Partnership decisions often shed light on the current state of a firm, its prospects for the future, and its priorities.
How many new partners did a firm make? How does the number of new partners this year compare to past years? In which practice areas did it make new partners? How many of the new partners are women or minorities?
As we’ve discussed before, many firms have cut back dramatically on making new partners, thanks to the recession. See here for examples of firms that have cut their new partner classes by 25 percent, 50 percent, or more.
At other firms, however, it seems to be business as usual — like Jones Day.
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.
Here at Above the Law, we do a lot of work to pierce through the veil of silence regarding compensation at Jones Day. The firm notoriously tries to keep associate salary, partner draws, and bonus information secret. But we’ve been able to report on the Jones Day salary structure and its associate bonuses. We were even able to tell you when Jones Day froze salaries for its staff.
We believe that information wants to be free. But apparently management at Jones Day thinks people are happier when they are kept in the dark. Today, the Recorder reports (subscription) that Jones Days believes its lack of salary transparency makes for a better work environment and has helped the firm make it through the recession. The ABA Journal has this excerpt from the Recorder’s report:
Observers say the law firm’s closed compensation system is helping its efforts to hire quality laterals because partners don’t know what the new hires are paid and can’t complain.
The article notes that the business card for Joe Sims, the lawyer heading up the West Coast expansion, doesn’t indicate his title or business area. His explanation: “We don’t do titles here.”
The story concludes that there are a lot of things Jones Day doesn’t do. “It doesn’t tell its partners what other partners make, it doesn’t issue profit figures, it doesn’t pay bonuses, it doesn’t let partners vote on who will head the firm, it hasn’t conducted mass layoffs, and it doesn’t pay associates in lockstep.”
Partner Joe Sims has talked the talk before on Above the Law. And his firm continues to walk the walk. More details after the jump.
Let’s finish off the prestigious Vault 20. Here we have some firms on the rise, and some firms that are … not.
Here is the next batch of firms:
16. WilmerHale 17. Latham & Watkins 18. Arnold & Porter 19. Jones Day 20. White & Case
Okay, before we discuss Latham and White & Case, let’s give a good cheer for WilmerHale (up one spot from last year), Arnold & Porter (up two spots from last year), and Jones Day (up four spots from last year).
The Jones Day surge is particularly impressive. You’ll remember that the firm slammed its competitors earlier this month. But it seems like the firm is walking the walk as well as talking the talk.
After the jump, you know what happens next.
Jones Day has escaped a lot of the worst side effects of the recession. The firm hasn’t had massive layoffs, it hasn’t cut associate salaries, it hasn’t canceled its summer program. That is something to be proud of.
And Jones Day seems very proud. Above the Law has obtained an internal newsletter from Jones Day that was aimed at its California office. The message was written by partner Joe Sims and it’s slated as a “midterm report” about the firm. Much of the letter is the kind of standard stuff you are used to seeing from slick, firm sponsored content:
The reality is that we are feeling the same reduced demand that is facing all law firms; I think it is clear — and as the results from other firms become visible, it is going to be even more obvious — that we are dealing with those circumstances better than most. So we have our challenges but, ironically, this difficult economic climate is also producing the best opportunity we have ever had in California to really separate ourselves from most of our peer competitors, and to move toward the position we aspire to — being universally recognized as one of the leading firms in California.
But what makes this newsletter extraordinary is that the message gets very specific about just why Jones Day is poised to separate itself from its peer competitors. And the newsletter offers Sims’s analysis of precisely where the firm’s California competitors went wrong.
More details after the jump.
* Like Drinker Biddle, Frost Brown Todd is instituting an apprenticeship program for its first year associates. They make less money and are billed out to clients at lower rates during their 1,000 hour apprenticeship. [Business Courier of Cincinnati]
* Stereotypes and jury selection. [Baltimore Sun]
* Jones Day’s Corinne Ball showed she’s the master of the quickie during the Chrysler restructuring. [New York Times]
* What can David Carradine’s family do about his death photos going viral? [American Lawyer]
* Behind the scenes in the push to get Sonia Sotomayor to SCOTUS: The White House keeps her supporters on a tight leash. [Washington Post]
* The San Francisco Chronicle recounts SCOTUS Justice Anthony Kennedy’s commencement speech at Stanford on Sunday, but strangely accompanies the article with a photo of Clarence Thomas. Do all the non-liberal justices look the same to you, San Francisco? [San Francisco Chronicle]
* Musical Chairs: Kirkland & Ellis loses the majority of its West Coast bankruptcy and restructuring team to Jones Day. Six L.A. lawyers and one N.Y. associate are making the Jones Day jump. [American Lawyer]
* A personal injury firm in Connecticut has sued Google for selling its name to a competing firm. Stratton Faxon is also trying to get an injunction to prevent Google from selling law firm names as adwords at all. Note that this firm specializes in personal injuries and not IP law. [Connecticut Law Tribune]
* SCOTUS lifts restrictions on questioning suspects without their lawyers present. [Seattle Times]
* A transcript of a conversation between Roland Burris and the brother of Rod Blagojevich proves that Burris likes Titanic quotes. The Senate Ethics Committee and a state attorney get to decide if it also proves Burris made improper offers in exchange for Obama’s vacated seat in the Senate. [Courthouse News Service]
* A 53-year-old martial arts instructor in Texas is quite the middle-aged ladies’ man. He has his hair, a flat stomach, a Corvette, and a French accent. Unfortunately, he also has AIDS and has been convicted of six counts of sexual assault for knowingly infecting his partners. [Dallas Morning News via ABA Journal]
* Back in her Yale days, SCOTUS nominee Sonia Sotomayor had a nasty OCI with the firm formerly known as Shaw Pittman, now Pillsbury. [Los Angeles Times]
Watch to find out what some of our subscribers received in their May box!
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We currently have a number of active openings for associate roles at US and UK firms in HK / China, Singapore and two new in-house openings. As always, please feel free to reach out to us at firstname.lastname@example.org in order to get details of current openings in Asia, as well as to discuss the Asia markets in general and what we expect for openings later this year. Our Evan Jowers and Robert Kinney will be in Beijing the week of March 25 and Evan Jowers will be in Hong Kong the week of April 1, if you would like to meet them in person.
The US associate openings we have in law firms are in the usual areas of M&A, cap markets, FCPA / white collar litigation, finance, and project finance. The most urgent of our top tier (top 15 US or magic circle) law firm openings in Asia (among many other firm openings that we have in Asia) are as follows:
• 2nd to 5th year mandarin fluent M&A associates needed in Beijing and Hong Kong at several firms;
• Korean fluent 2nd to 4th year cap markets associate needed in Hong Kong;
• 2nd to 5th year Japanese fluent M&A associates needed in Tokyo;
• 4th to 6th year mandarin fluent cap markets associate needed in Hong Kong;
• 2nd to 4th year M&A / cap markets mix associate needed in Singapore.
The last time I flapped my wings your way, I tried to make at least enough noise about your mobile phone to make you more than a little bit uncomfortable. I hope I did. If enough of us become anxious enough about the known and unknown unknowns and knowns in our mobile phones, then we can start making wise decisions about how to manage that information and its resultant investigations.
Today, I’d like to put a finer point on the last installment’s topic by asking a question that seemed to catch most attendees off-guard at a conference panel that I moderated last week: is there discoverable personal information in a mobile app? Our panelists’ answer was a uniform “yes” with one stating that, if he had to choose only one type of data that he could discover from a mobile phone, he’d choose app data. Why? Because there’s simply so much of it and because almost all of it is objective – not just user-created like an email – but machine-tracked like GPS, usage duration, log in and log out times, browsed web addresses, browsed actual addresses. Also, most of us seem to have the idea that data doesn’t actually “stick” to our mobile devices the way it “sticks” to our hard drives. Maybe there’s a disconnect based on the fact that our phones are mobile so we assume the data is mobile to?
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