Earlier today, we reported that Katten was holding a firm wide meeting this afternoon. Predictably, the talks soon turned to layoffs. Here is what some of the people who were at the meeting are telling us:
20% pay cut if average billables were less than 150 last year and less than 145 for the last 3 months. 12 associates laid off (seems VERY low …). Incoming associates deferred until Feb 2010 start date.
The 12 number seems low to other tipsters too. But the meeting isn’t over in all of the firm’s offices yet. And these numbers do not take into account how many (if any) staff were laid off, or income partners.
I say income partners because we have received more reports that some of them were let go as well.
Update (4:38): Katten has released an official statement. 69 people were let go. Like Jenner earlier today, Katten describes the layoffs as “relatively small.” It looks like we have a new “official euphemism,” but in both cases it happens to be true. Read the full statement after the jump.
But we are also getting some very interesting news about the severance package Katten is offering. Details on that after the jump.
Something is going down at Katten today. Multiple tipsters report that a firm wide meeting has been scheduled in each Katten office for 2:00 p.m. central time today. According to the email announcing the meeting, the purpose is:
[T]o discuss the Firm’s Plan for dealing with the continuing weak economy and how that plan relates to the associates.
The firm has not responded to our inquires about this meeting. But our sources report some obvious (and not so obvious) details. Katten has already been through one round of associate layoffs, and many people expect that the firm is initiating round two today.
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.
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.
Katten Muchin Rosenman has officially announced that they have parted ways with a number of attorneys. According to partner and spokesperson Tasneem K. Goodman:
Katten Muchin Rosenman LLP this week eliminated the positions of 21 associates and counsel across multiple offices and practices. This measure was taken to further improve the firm’s efficiency, to allow for the continued growth of its associates and to ensure the firm’s long-term success. No adjustments will be made to the new first-year associate class. The firm’s financial performance remains strong despite the current economic downturn.
You have to compare that statement with the one from Clifford Chance yesterday. After laying off 20 litigation associates, their statement said (in part):
Those attorneys in New York and Washington, D.C. affected by today’s decision are held in high regard by the firm. These layoffs were not performance-driven
From Katten we hear that their 21 associates were laid off “to improve efficiency.” Make of that what you will.
Check here to see how Katten’s layoffs unfolded throughout the day.
Perhaps the Clifford Chance layoffs were just the beginning. We’re getting multiple reports that Katten Muchin Rosenman is laying off associates in their Chicago office, today. Right now.
Katten representatives did not respond to inquiries made last night or today.
Meanwhile, the Charlotte-firm of Moore & Van Allen has laid off 20 staff members today. Though calls to Moore & Van Allen were not immediately returned, one tipster suggests that the layoffs were focused in the Wachovia practice group.
No word yet on the safety of associates at Moore & Van Allen.
We will update you as more facts become available. But do not trust to hope, it is forsaken in these lands.
Update (5:40): Moore & Van Allen tipsters want us to know that the Bank of America group was hit just as hard, if not harder than, the Wachovia group.
Update (6:05): While Katten is still not officially confirming anything, recently laid-off attorneys are telling us that they are hearing that between 20-25 associates where let go today in the Chicago office. The severance package: 90-days at full salary. Not good times today. Bad times.
* 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]
Our Vault 100 series is winding down. We hope that the insiders have enjoyed the opportunity to brag (or to vent) about their firms. And that the curious have appreciated insights into life at various firms in the top 100.
Here is the next bunch up for discussion (with their prestige scores in parentheses):
No wonder the producers of The Bachelor are so eager to have a lawyer as the Bachelor. With their impressive educational pedigrees and generally high incomes — even non-top-tier law grads earn more than the average American — lawyers are a desirable demographic. And relying upon the contestants to keep lawyers watching might not be a smart idea, since legal eagles keep getting shot down on the show.
From a tipster (a distinguished law professor, which goes to show that even geniuses enjoy trashy TV shows):
[O]n last night’s season premiere of the Bachelor, both of the law students were sent home in the first cut. The Phoenix Suns dancer stayed.
I only caught the beginning, when they were all being introduced, and I noticed the two law students – couldn’t figure out for sure what schools they were at. I’m guessing this show was taped over the summer, so this may have been their substitute for a summer associateship. In hindsight, a bad decision….
I was on the phone the rest of the time, and only learned later that they were both cut. They were decent-looking, though, so I wonder if it was their winning law school personality that made the difference…
We agree. The eliminated contestants — Juli, 24, of Chicago, and Natalie, 25, of Duncanville, TX — are quite comely. We’re guessing they go to non-top-tier law schools, which have hotter students.
We don’t watch The Bachelor; we prefer to spend our trash TV time on Gossip Girl. But if you saw the season premiere, and paid more attention than our tipster, we welcome your thoughts on why the law students got cut. Update: From another source:
“Not sure what law school Juli attends (I believe it’s Michigan, but I don’t have confirmation on that), but I CAN confirm that she was a summer associate at Katten’s Chicago office. She left partway through the summer to film the show, and she STILL got an offer. True story.”
Last week we told you about a fellow at Katten Muchin Rosenman in Chicago, who managed to achieve the impossible feat: he got fired from a summer associate gig. This is even more impressive than merely getting “no-offered” at the end of the summer. We wrote:
1. A summer associate in the Chicago office of Katten was fired earlier this month (believed to be the week of July 9, 2007).
2. His employment was terminated because (a) he allegedly engaged in inappropriate sexual conduct with female summer associates, variously described as “repeatedly smack[ing] the asses of female summers” or “playing grab ass with female summers,” and (b) he allegedly made racially insensitive jokes, in front of multiple attorneys.
In the wake of this story, a reader sent us this message:
Apparently, the WSJ Law Blog “Rules of Etiquette” for summer associates need minor revision. Here are my suggested changes.
You can check out the new and improved etiquette handbook, after the jump.
Yesterday we wrote about a former summer associate in the Chicago office of Katten Muchin Rosenman. He was fired earlier this month, after he allegedly (1) made racially insensitive remarks and (2) engaged in inappropriate physical contact with female summer associates.
With respect to the first allegation, it’s claimed that he first made a racist comment to another summer associate. When she got angry, he supposedly told her he liked “angry black women.”
(Hmm… What’s he doing for the rest of the summer? We hear that Shanetta Cutlar is hiring.)
With respect to the second allegation, it’s claimed that the ex-SA “repeatedly smack[ed] the asses of female summers” or “play[ed] grab ass with female summers.” What was he thinking? This is obviously unacceptable.
(Silly summer. Ass-grabbing is for partners!)
Read the rest, after the jump.
A college graduate without student loan debt is akin to reading a kind quote about Kim Kardashian in a tabloid—it’s rare.
In the past eight years, student loan debt has nearly tripled to a whopping $1.1 trillion, and in the past 10 years, the percentage of 25-year-olds with such debt has risen from 25% to 43%
It’s gotten so bad, in fact, that New York Fed economists warned last month that the burden of student debt could stilt consumer spending by twentysomethings, as well as further hamper the recovery of the housing market and economy.
To get a better idea of what massive student loan debt (we’re talking over $100,000 massive) looks like, we talked to an attorney who graduated with a large student loan debt. We also consulted LearnVest Planning Services CFP® Katie Brewer to see just how their repayment plans stack up.
S. Fischer, 36, Attorney Graduated: 2001
How Much I Borrowed: $100,000
What I Still Owe: $45,000
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Ed. note: The Asia Chronicles column is authored by Kinney Recruiting. Kinney has made more placements of U.S. associates, counsels and partners in Asia than any other recruiting firm in each of the past six years. You can reach them by email: email@example.com.
Deal flow has clearly picked recently up for most US associates, counsels and partners in Hong Kong/China and Singapore. We are on the phone with a lot of these folks on a daily basis, many of whom we have known for years. Further, the head of our Asia team, Evan Jowers, and Kinney’s founder and president, Robert Kinney, frequently meet in person with leading US partners in Asia to assess their needs and keep on top of the inside scoop at as many firms as possible. The need for legal recruiting help in Asia from experienced recruiters appears to be live and well. In March, Evan and Robert were in Beijing at such meetings, in April, Evan was in Hong Kong, and for half of June Evan will be in Shanghai and Hong Kong. Thus its pretty easy for us to tell when there has been an across-the-market pick up in capital markets and corporate work.
On an average day in Asia when Evan and Robert visit firms, they typically have 5 to 9 meetings a day, mostly with US partners in the market. The reason they have these meetings is not simply because Kinney makes a lot of US attorney placements in Asia and that a particular firm may have openings; instead these are just visits with friends. After years of working together as business partners, the folks at Kinney are actually these peoples’ friends. The firms Kinney work closely with in Asia (which is just about every law firm – call us if you want to know the one firm in the world we will never place anyone with again, ever, and why) look forward to the visits, or at least act like they do. After seven years in the market, many of the client partners are former associate candidates. Also, these US partners see Kinney as a very good source of market information as well, because they know how deep their contacts are in the market and how frequently they are speaking to counterparts at peer firms.
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