We wonder if law firms think of our Nationwide Layoff Watch feature like the Eye of Sauron, from Lord of the Rings. If so, "The Eye" has come to rest on Charlotte.

We hear rumors that Hunton & Williams is laying off associates down in CLT. From a tipster:

Hunton & Williams in Charlotte is conducting layoffs, including first-years [from the class of 2007]. The first-years may work until June 30, but then they must leave the office; however, they will have access to email and phone and pay until December 31.

Pay through December 31? Seems odd. It would amount to six months of severance, even though "market-rate" severance in recent law-firm layoffs hovers around three months. Is Hunton raising the bar?

In addition, we hear that two incoming H&W first-years in Charlotte had their offers rescinded. If true, it's not surprising; other firms have previously rescinded offers to CLT associates. See, e.g., Sonnenschein.

Layoff talk centered on Hunton's Charlotte has also surfaced at Infirmation / Greedy South, here and here. Back in January, there were rumors of firings in Atlanta (labor and employment).

We contacted Hunton & Williams. Their comment: "We don't comment on rumors." C'mon, really? What do you comment on, then?

If you have any more information on the H&W situation, please send us an e-mail (with Hunton & Williams in the subject line). Thanks.

Update: No layoffs -- yet -- according to managing partner Walfrido Martinez, who spoke to Am Law Daily. But he acknowledged that the firm is "redeploying" an unspecified number of asset securitization lawyers in Charlotte to other practice areas: "Option number one is always redeployment. If redeployment does not work, we will talk about transition arrangements."

Before we issued our report on lawyer layoffs at Paul Hastings, we reached out to the firm for comment. Eileen King, Global Director of Public Relations for Paul Hastings, told us that "the firm does not comment on employment law matters."

Or something. After being subjected to waterboarding the enhanced interrogation techniques of the American Lawyer, Paul Hastings was moved to speak:

King told The Am Law Daily that while some associates have been let go, they were part of typical annual performance reviews. While she declines to say how many had been let go, King says the numbers were in line with last year's cuts.

"There is always resulting turnover [after performance reviews], but we have not done any layoffs," King says. "It's really normal attrition based on performance evaluations, and the numbers show year over year that we're up in associates. We're a healthy firm in terms of head count and real revenue perspective, and the numbers really say the story in my mind."

We'd be interested in seeing some actual numbers, in terms of this year's cuts compared to last year's cuts. But we'll take PH at its word -- if they say no layoffs, then there have been no layoffs.

Laying off associates? It's just a state of mind. One firm's "layoffs" are another firm's "normal, performance-related attrition."

King says the firm's revenue and head count situation is healthy. Associate head count, she adds, is up "considerably" for the year, and the firm expects to welcome a larger summer associate class than in 2007. Revenue increased 19.9 percent in 2007, to $925 million. Profits per partner were up 19.6 percent, to $1.92 million.

A dramatic increase in PPP isn't necessarily a rebuttal to the layoff claims. As Shinyung Oh, author of the famous PH Farewell Email, told the WSJ Law Blog, in explaining why she sent her dramatic missive, "I want [laid-off associates] to feel like they’re not completely alone and not to worry about their own performance when it’s the firm doing something for economic reasons... [or a] desire to increase partner profits."

Speaking of Shinyung Oh, her bio is no longer on the PH website. Has she been officially terminated?

We're looking into the situation. If you know anything, feel free to drop us a line.

Paul Hastings Denies Reports of Layoffs [American Lawyer]
Paul Hastings scotches lay-off reports [Legal Week]

Earlier: Nationwide Layoff Watch: Paul Hastings

Rumors of lawyer layoffs at Paul Hastings have been circulating for quite some time, since late last year. For example, back in November, we heard that the firm laid off / fired several associates in the real estate group. But we heard that secondhand, and we were unable to get confirmation, so we never wrote about it.

(That happens all the time, by the way. We get lots of gossip, but much of it never sees the light of day.)

Why has the PH layoff news been so elusive? One source explained: "A former Paul Hastings partner said PH likes to do its layoffs a little at a time, so they stay under the radar. I guess that didn't work out too well this time."

You can say that again. This week's bombshell -- an emotional farewell email from an associate in San Francisco who was laid off six days after her miscarriage (hereinafter "the PH Farewell Email") -- confirms the rumors: Paul Hastings has been laying off associates. But it has been doing so quietly, in small clumps, spread out over many months.

If the other laid-off lawyers got the same deal as the author of the PH Farewell Email, they received a three-month severance package. This appears to be standard or "market" for the latest round of Biglaw layoffs. For more details about the Paul Hastings severance deal -- e.g., health insurance, vacation, access to firm email and voicemail -- see the agreement (which also provides that the departure "is and will be classified as a resignation").

Also note the agreement's strict confidentiality provisions. In a nutshell, Paul Hastings has been buying the silence of the laid-off lawyers -- and up until this week, the strategy was working quite nicely. PH isn't a leading employment-law shop for nothing. They know how to draft a tight agreement, how to keep firings on the down-low, and how to keep terminated employees silent.

But now, in the wake of the PH Farewell Email, the floodgates have opened. Yesterday we solicited tips about Paul Hastings lawyer layoffs -- and we received a wealth of information, from current and former PH lawyers, no longer afraid to speak out. (Of course, to be on the safe side, most of these sources emailed us from home, using their personal email accounts.)

The results of our investigation, after the jump (i.e., click on the "Continue reading" link below).

Don't worry, commenters. We have every intention of giving the recent controversy arising out of layoffs at Paul Hastings the wall-to-wall coverage it deserves.

We're preparing a more detailed report on associate layoffs and the general state of affairs at PH. If you have information to contribute, please email us (subject line: "Paul Hastings"). We've been following the comments (750 and counting) on the post, but we prefer email, due to the greater accountability and opportunity for follow-up. (We keep our email tipsters anonymous, of course.)

Our Paul Hastings scoop has reverberated throughout the blogosphere. A sampling of reactions (excerpts; click on each link to read more):

1. Jezebel. From Moe Tkacik:

[A] female lawyer was laid off by the big law firm Paul Hastings days after suffering a miscarriage because they didn't want her to get pregnant again. This sort of s**t happens all the time in a lot of industries, of course, but in a firm whose specialty is employment law it's kind of outrageous....

"If this response seems particularly emotional, perhaps an associate's emotional vulnerability after a recent miscarriage is a factor you should consider the next time you fire or lay someone off," she writes.

Also, it really isn't that emotional in light of the fact that a male employee of the firm killed himself and his ex-girlfriend, a Paul Hastings secretary, at the firm's Atlanta office.

Excellent observations -- the past few weeks have been rough for Paul Hastings. And it is somewhat ironic that PH -- a leading employment-law firm, counsel to Sullivan & Cromwell in the Aaron Charney discrimination litigation -- now finds itself in hot water over how it treats its own employees.

2. Instapundit. From the ever-pithy Professor Glenn Reynolds:

WHEN NONDISCLOSURE AGREEMENTS don't work.

3. Volokh Conspiracy. From Professor Orin Kerr:

It's David Lat's World, and BigLaw Partners Are Just Living In It: Remember the old days when law firms worried about getting sued if they fired an attorney? These days, I would think the greater fear is that the firing will get ugly and end up featured on Above the Law.

Thanks to Professor Kerr for the kind words.

Read more, below the fold.

Last week, we reported on rumors of layoffs in the Atlanta and D.C. offices of Sutherland Asbill & Brennan. The post has amassed over 400, um, informed comments.

The fact of layoffs has now been confirmed by the firm. Although Sutherland never responded to ATL's inquiries, it did talk to Meredith Hobbs, who has this article in the Fulton County Daily Report. The number of firings was lower than rumored, with maybe 8 attorneys let go from the Atlanta office and maybe 7 from the D.C. office. (Managing partner Mark Wasserman uses a lot of modifiers: "fewer than," "about," etc.)

The legal tabloid AbovetheLaw.com sparked a firestorm of rumors when it reported Friday that Sutherland Asbill & Brennan was laying off 30 to 40 associates firmwide.

Sutherland's managing partner, Mark D. Wasserman, acknowledged that the 480-lawyer firm has cut its associate ranks. But he said the firm has asked fewer than 15 associates to leave, with about eight associates affected in the Atlanta office.

Wasserman said the cuts were based on "several factors," "including the slowing economy, plus associate and practice group performance."

The firm says it still plans to bring in all of its summer associates and attorneys starting in the fall. But there's this warning about the future from legal recruiter Melba Hughes:

“I think we're going to see law firms tighten their belt throughout the region. It's a natural course of events given the period we've just gone through,” she said.

That could mean law firms reduce head count through layoffs, attrition, more cautious hiring and “by looking for new and creative ways to manage their workloads,” said Hughes, which could mean using more contract and staff attorneys instead of partnership-track associates.

The firm did not comment on the herpes rumors.

In The Trenches: Sutherland trims associate ranks [Fulton County Daily Report]

Earlier: Nationwide Layoff Watch: Sutherland Asbill & Brennan

Rumors are circulating about layoffs in the D.C. and Atlanta offices of Sutherland Asbill & Brennan. We reached out to the firm for comment, but they have not responded yet. This is what we have heard.

One ATL tipster says:

Just curious about whether ATL had heard that Sutherland, Asbill, and Brennan had laid off a bunch of folks (expected to be between 32 and 40, when it's all said and done) in the Atlanta and DC offices. Apparently it's been handled pretty poorly and has obviously left a lot of associates in the lurch, both those fired and the remaining people who are waiting for the other shoe to drop.

Another tipster says:

I've heard a few rumors (well, verified facts rather) about massive layoffs in Sutherland's DC and Atlanta offices recently. Rumors put the number at over 30 attorneys, including very junior attorneys. Put out the call and reveal the mystery that is the Sutherland Slaughter!

If you have any info to share, please email us. Thanks.

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?

Earlier today, in the wake of yesterday's post about troubles in the Charlotte office of Sonnenschein Nath & Rosenthal, firm chairman Elliott Portnoy sent around an irate email:

From: Portnoy, Elliott I.
Sent: Wednesday, April 09, 2008 12:40 PM
To: #Attorneys-All
Subject: Rumors Regarding Charlotte and Summer Program

Many of you have recently heard claims regarding our Charlotte office that have emanated from certain blogs frequented by law students. I write today to let you know the facts, not rumor or speculation. Firmwide, we will have more than 50 Summer Associates joining us over the coming few months, and we plan to have 24 first-years joining us this Fall across the firm.

First, this fine website, while certainly "frequented by law students," is also read by many other folks - e.g., law professors; associates, partners, and recruiting personnel at top law firms; in-house and government lawyers; law clerks and judges; and legal reporters and PR professionals.

Second, Portnoy attempts to draw a distinction between "facts" and "rumor." But the core of what we reported - namely, that the firm has rescinded offers of summer and full-time employment in its Charlotte office - is a fact, acknowledged by Portnoy later on in his message.

Read the rest of that email message, with our running commentary, after the jump.

Over at Greedy South, various rumors are circulating about Sonnenschein Nath & Rosenthal. One poster claimed that the firm rescinded offers of summer employment to several incoming summer associates in the Charlotte office. Later on in the thread, others chimed in to claim that the firm is rescinding offers to full-time associates who were set to arrive in the fall (possibly beyond Charlotte as well).

An ATL tipster wrote us:

I know things are really, really, slow at most firms in Charlotte (as has been noted by the firings at Cadwalader and Dechert), but is there any way that you could find out whether this is actually true? It seems like the elephant in the room is everyone's hope that securitization will magically pick up again, but everyone seems to forget that it's difficult for a market segment to "rebound" that wasn't even in existence 10 years ago.

Is this a sign of Sonnenschein closing its Charlotte office (after only 1 year)? Have you heard anything about other offices having the same types of problems? Just trying to find out what's going on.

We reached out to the firm for comment earlier this week but they never got back to us. If you have any info to share, please email us. Thanks.

Sonnenschein Firings? [Greedy South / Infirmation]

We've received approximately five hundred responses to last week's ATL / Lateral Link survey on whether you expect layoffs at your firm, and how you're coping.

By and large, you're a pretty gloomy bunch. Forty-three percent of respondents are afraid that their firm will have layoffs. Among respondents who are Class of 1999 or more senior, this number spiked to 66%. Among law students, 53% of respondents are afraid their firms will have layoffs.

Respondents in the Bay Area, New York and Chicago were the most concerned, with 56%, 48%, and 46%, respectively, fearing layoffs. In contrast, only 19% of respondents in Philadelphia said they were afraid of layoffs at their firms. In other markets, layoff concern ranged from 31% to 38% of responses.

Most respondents thought their law firms would provide at least some support during a layoff:

  * 54% thought their firm would provide a severance package.
  * 53% thought their firm would provide ample notice so they could find a new job.
  * 38% thought their firm would help them move between departments to stay busy.
  * 20% thought their firm would help them relocate to another office.
  * Another 20%, however, were not sure if their firm would help them, and 15% thought their firm simply wouldn't help them during a layoff.

While most respondents expect some support from their law firms, the most popular response to an anticipated layoff is to simply switch firms:

  * 53% of respondents said that they would talk to headhunters about switching firms or going in-house to protect themselves from a slowdown.
  * 42% would talk to friends at other firms.

Additional survey findings, after the jump.

Despite the recent turmoil in the economy and the stock market, all appears to be well at Milbank Tweed Hadley McCloy. A tipster provided us with the highlights of chairman Mel Immergut's "State of the Firm" address from last week:

1. Primary caregiver leave is now 18 weeks paid.

2. Blackberries will get replaced every two years instead of three.

3. "We're not getting fired."

It appears that Milbank has effectively made a "no layoffs" promise. It learned that lesson the hard way:

Mel stressed that in the last downturn, they had slowed hiring, and then found themselves at a loss for mid-level associates when things picked up later. So the plan is to continue to hire new people (our summer program is the largest to date at 100+) and retain, but not really hire laterals.

Will other firms make a similar pledge? We'll see.

I had been planning to share the results from last week's ATL / Lateral Link survey on which other firm you would want to go to today, but in light of recent events at Thelen Reid and Edwards Angell, let's just leave that survey open for a bit longer. Let's talk about whether the slowdown is going to hit your firm as well, and how you might cushion the impact.

We'll report results next week. Until then, if you'd rather be somewhere a little more stable, vote with your ballot here or with your feet here.

The rumor making the rounds of lawyer and staff layoffs at Thelen Reid Brown Raysman & Steiner is true. We just spoke to Thelen's co-chair, Stephen V. O'Neal, who provided confirmation and details.

The firm is in the process of laying off 26 associates and 85 staff members, on a firm-wide basis, "in response to recessionary pressures." (Unlike President Bush, Mr. O'Neal was not afraid to use the "r" word.) Thelen has approximately 600 lawyers, per its website, so the cuts amount to roughly 4 percent of total headcount.

With respect to the location of the affected lawyers, the cuts affected all major offices. With respect to seniority -- one source told us that some first- and second-year associates were fired -- Mr. O'Neal said that "some were fairly junior, and some more senior."

In terms of practice areas, Mr. O'Neal said the layoffs were spread out among groups, but with "some areas more impacted than others," including certain parts of capital markets and cap-markets-related real estate work. He noted that other practice areas are "thriving and increasing in scope," including renewable energy, cross-border M&A, China practice, litigation, and workouts / bankruptcy.

With respect to staff layoffs, Mr. O'Neal explained that they are due in part to the economic climate, but in part due to post-merger staff redundancies. The merger of Thelen Reid and Brown Raysman took place in late 2006, making the consolidated firm a little over a year old. But the firm did not do much cutting of staff in 2007.

Last year "was not a year when we tried to make deep cutbacks in anything, even though we had combined two good-sized firms," explained Mr. O'Neal. "It was a year of building, coordinating, and consolidating. We wanted to understand how best to organize this new entity." Now that the firm has a better understanding of its staffing needs, and is in the process of consolidating multiple offices in the same cities (e.g., New York), it is reducing staff redundancies.

As for associate severance packages, Mr. O'Neal stated that firm provided a "market-level" package. We floated three to four months as our understanding of market, and he said that the firm is "in that ballpark."

"We are anticipating a profitable 2008," said Mr. O'Neal. "We are being prudent businesspeople, and when you are dealing with recessionary pressures, you adjust your business so you will have -- and maintain -- a strong level of profitability, notwithstanding those pressures."

We thank the firm for the information and candor with respect to the layoffs (i.e., not casting these departures as "performance-based"). If you have more information, feel free to email us.

Updates: A few additional nuggets:

1. As noted in the comments, total headcount includes partners and counsel, so the percentage of associates laid off is higher than 4 percent. Some of you suggest it's around 10 percent.

2. We're a little annoyed at Legal Pad for the lack of an ATL shout-out -- in both the blogosphere and the MSM, it's proper form to credit and/or link to the source that breaks a story first (even if you were working on the same story too) -- but we'll link to them anyway.

They have more on the Thelen layoffs here. Much of the info in their post appeared previously in ours, but they do add that the firm "is also trimming its summer program from eleven to eight weeks and is pushing the start date for first-years from September to January."

3. A source at the firm tells us that the severance packages were in the two- to three-month range.

Earlier: Prior ATL coverage of layoffs (scroll down)

Don't believe everything you read in these pages. If a gossip site isn't flat-out wrong a sizable percentage of the time, it's not sufficiently gossipy.

But we were right about something being afoot at Dechert LLP. This morning we wrote:

We've been hearing vague rumblings of something about to go down over at Dechert LLP. Said rumblings are reminiscent of what we heard in the days and hours leading up to Cadwalader's Thursday Morning Massacre....

We hear that certain groups at Dechert are super-slow, and morale in some quarters is super-low. These are, of course, often harbingers of lawyer layoffs.

Now we learn this, from Gina Passarella in the Legal Intelligencer:

The slowing economy has hit home at Dechert which has just let go 13 associates strictly in its finance and real estate practice, according to a source inside the firm....

Dechert has given the 13 associates, who have worked in Dechert offices throughout the United States, until the close of business Tuesday to leave. No one was asked to leave Friday, the source said....

There were no additional layoffs prior to today, but some attorneys were shifted into other practice areas, the firm source said. The layoffs comprise less than 10 percent of the 167 attorneys listed in Dechert's finance and real estate practice, which includes mortgage finance, structured finance and securitization, investment, and mergers and acquisitions.

The attorneys who are leaving were offered three months severance, six months of paid medical benefits and transition placement support, the source said.

Three months seems to be "market" in terms of severance. There was some fear that laid-off Dechert associates were going to get less.

ATL gets a shout-out in the piece:

Legal blog Above The Law has reported extensively on associate and staff layoffs across the country. The reports included associate layoffs at Thacher Proffitt, Cadwalader Wickersham & Taft and Clifford Chance, mainly in the structured finance, real estate and capital markets practices of those firms.

Today, Above The Law posted a blog on rumors of low morale at Dechert, questioning whether layoffs were imminent.

The article closes with a helpful overview of the layoff landscape:

Dechert's news puts the U.S. legal scene over the 100-attorney mark in terms of attorney layoffs and offered buyouts this economic cycle. According to data collected by The American Lawyer, 35 attorneys were laid off at Cadwalader Wickersham; 24 Thacher Proffitt mid-levels were offered buyouts plus an additional five first-years took optional buyouts; six Clifford Chance associates were laid off and 23 associates at McKee Nelson took buyouts.

Check out the full article, which also discusses Dechert's record-setting year in 2007 -- $836 million in gross revenue, and more than $2.3 million in profits per equity partner -- by clicking here.

Update (5:15 PM): Okay, we're confused. We just received this email, sent out by firm chairman Barton Winokur, and forwarded to us by a Dechert source. Our source had heard that the 13 were being laid off. But this email implies otherwise:

From: Winokur, Barton
Sent: Friday, February 29, 2008 4:37 PM
To: ALL Dechert Users
Subject:

Due to the major shift in market conditions affecting client demands in our Finance and Real Estate practice area, we currently do not have sufficient work for all the associates in FRE. As a consequence, we have told 13 associates in the U.S. FRE group that we see no demand for them in that group in the foreseeable future. However, due to increased and substantial demand in other practice areas, we will be offering those lawyers the opportunity to work in those other groups.

Barton J. Winokur
Dechert LLP

Update (5:40 PM): We have reached out to Barton Winokur for clarification. We will let you know if and when he gets back to us.

Update (6:20 PM): The Legal Intelligencer has revised its piece somewhat, in light of the Winokur email:

The slowing economy has hit home at Dechert which just issued layoff notices to 13 associates strictly in its finance and real estate practice, according to a source inside the firm.

Shortly after the firm confirmed the planned layoffs, the source said Chairman Barton J. Winokur issued a statement that the firm would then offer the 13 associates positions in other practice groups. [Reprints the email.]

There was no word as to whether those associates, who had been given severance packages, accepted the revised offer to switch practices.

Update (6:35 PM): We're hearing conflicting things about whether these 13 lawyers really are being given the opportunity to switch practice groups, or whether they're being laid off outright, with additional lawyers getting moved internally.

We will continue to monitor and report about what's going down at Dechert. If you can clarify this somewhat murky situation for us, please email us. Thanks.

Layoffs Hit Dechert Following Record Financial Year [Legal Intelligencer]

We've been hearing vague rumblings of something about to go down over at Dechert LLP. Said rumblings are reminiscent of what we heard in the days and hours leading up to Cadwalader's Thursday Morning Massacre. Also note this comment on today's Morning Docket:

Not all Dechert associates have three days to enter their time. Some will need to enter it before they leave the building today.

We hear that certain groups at Dechert are super-slow, and morale in some quarters is super-low. These are, of course, often harbingers of lawyer layoffs.

We've put in an inquiry to the firm, but they haven't gotten back to us yet. We'll let you know if and when they do. In the meantime, feel free to dish in the comments, or email us. Thanks.

Update (4:40 PM): As reported by the Legal Intelligencer, Dechert just laid off 13 associates. We have a new post up on the subject over here.

This morning we've been hearing rumors of associate layoffs at Thacher Proffitt & Wood. As you may recall from ATL's prior coverage (scroll down), TPW has reduced its ranks over the past few months, through voluntary departures. But those departures took place after the firm warned that it might have to resort to layoffs.

Apparently something went down at the firm yesterday afternoon. Some sources characterized what happened as layoffs, with affected associates given until May to leave. But we contacted the firm, which denied the rumors and issued this statement:

Thacher Proffitt has not done layoffs. We have increased our efforts to provide associates with outplacement in practice areas that have been most affected by current market conditions.

We take the firm at its word; they've been pretty candid in the past about their personnel decisions and how they've been affected by the credit crunch. If you have the inside scoop on what took place yesterday, please email us. Thanks.

This latest layoff news may not be super-exciting to the associates among you, since it relates to staff rather than lawyer layoffs.The East and West Coast snobs will dismiss it as news from "flyover land."

But as we previously observed, staff layoffs "serve as a 'canary in the mine' of sorts, with respect to a law firm's financial health." And the firm in question, Winstead, is one of Texas's largest firms.

So this news merits mention (on a somewhat slow news day). From the Dallas Morning News:

Texas-based Winstead PC will lay off 20 support staff employees in its Dallas office, chief executive Denis Braham said Wednesday.

The firm also let a few associate attorneys go in the restructuring, but Mr. Braham said the firm typically cuts some associates each year.

Our tipster expresses skepticism: "Bulls**t. This is the same firm that came out after salaries increased last time to 160 and said, 'we are not raising.' I think they later caved."

Winstead to lay off 20 in Dallas office [Dallas Morning News]
Winstead Says Yes to Bonuses, No to Raises [Texas Lawyer]

Here's an open thread request we've received from multiple sources. A representative message:

I'm trying to gather more info about firms / offices that pay NYC salary + NYC bonus in secondary markets. For example, I believe that Weil and Skadden both do in Dallas and Houston, but none of the other firms in Texas do. I don't know if you've done a post about this before, but I think it might be interesting, because $205K goes really far in TX.

Skadden Wilmington is another possible example.

That's correct about Skadden in Wilmington. Another well-paying secondary market: Charlotte. A CLT tipster tells us: "Mayer Brown, Dechert, Dewey, and Cadwalader have all increased salaries to $160K here in Charlotte."

Hold on a sec -- Cadwalader? Didn't they just lay off 35 lawyers, including some in Charlotte?

Yes, they did -- but they also raised salaries for the survivors. More after the jump.

Back in November, we broke the news that, barring a "substantial improvement" in market conditions, the law firm of Thacher Proffitt & Wood would resort to lawyer layoffs in January. The firm is a major player in structured finance and real estate, two practice areas that have been hard hit by the credit crunch.

January is now here -- and, in fact, almost over. We were reminded of this last week, when we saw this article in the New York Sun about law firm layoffs, mentioning Thacher Proffitt:

Earlier this month, Manhattan-based Cadwalader Wickersham & Taft laid off 35 lawyers, 26 of them in New York City, and late last year, Thatcher Proffitt & Wood cut 50 associates' jobs. The cuts have spurred other firms to follow suit, experts said.

Was the statement accurate, insofar as it suggests or implies that TPW laid off fifty (50) associates? We followed up with Thacher, which issued this statement, through a spokesperson:

As described in our November 27, 2007 official statement, we notified 24 associates in the Structured Finance and Real Estate Practice Groups that if there was no substantial improvement in the market, it was near certain that economic layoffs would take effect in January 2008. As of today, 99% of the 24 associates have accepted a package which compensates them through the end of March 2008, and many have already found new positions. To clarify recent media reports, these events occurred ahead of our initial plan to commence layoffs. [Ed. note: Maybe it should be 96% of the 24 associates -- 23/24 = 95.8%. But who knows... maybe one person is still working part-time for TPW?]

In addition, we offered our first-year associates in the Structured Finance and Real Estate Practice Groups a four-month severance package, should they volunteer to leave the firm. Again, referring to our original statement, the first-year associates' offer remains strictly voluntary; they are under no obligation to accept it. We do feel it's in their best interest to explore other opportunities, since we are concerned that we will not be able to provide them with the best work experience at this formative stage of their careers. A group of first-year associates has voluntarily accepted this package.

Finally, we would like to acknowledge the goodwill of those in the business and legal communities who have expressed interest in our associates and have helped to place them in new positions. Although these decisions were difficult for our firm, we are confident that our approach kept our associates' interests in mind and also mitigated our business risks.

We construed this as a statement that the firm did not have to resort to layoffs (as originally planned). We followed up with TPW, and they confirmed this understanding: "Up to this point, departures have been voluntary." [FN1]

But should TPW associates start dancing in the hallways? Not yet. When we asked if this meant the firm had ruled out layoffs going forward, Thacher was noncommittal: "We cannot speculate on future market conditions and the potential impact on our attorney population."

So stay tuned. In other TPW news, it's not just associates who are leaving. Partner V. Gerard (“Jerry”) Comizio, a prominent banking and financial services lawyer here in D.C., just left Thacher to join Paul Hastings (see this press release). When a firm is going through tough times, partner defections are to be expected (although they're unwelcome news, since rainmaker departures only exacerbate the problem of insufficient business to go around).

[FN1] We realize, of course, that if you "voluntarily" depart after being told you'll probably be laid off if you stay, it's not completely "voluntary." A cynic must suggest that it's like "voluntarily" giving the mugger your wallet after being told you'll be shot if you don't. But, on a hyper-technical level, we wouldn't consider these departures "true" layoffs. People can always wait for the ax to fall -- like the one apparent holdout among the 24 associates.

Fearing Recession, Law Firms Tighten Belts [New York Sun]
Pinup's Naked Justice: Keeps Lawyer Job [New York Post]
Paul Hastings Bolsters Bank Regulatory Practice with the Addition of V. Gerard Comizio to the Washington, D.C. Office [Paul Hastings (press release)]

Earlier: Nationwide Layoff Watch: Thacher Proffitt Announces Likely Future Layoffs

* Resignation in Detroit text-message scandal (previously discussed here). [Detroit News]

* A proud American tradition unknown in the rest of the world: bail for profit. [New York Times]

* Legal luminaries at the SOTU. [WSJ Law Blog]

* Trial begins in alleged microwaving of infant. [CNN]

* TRO against Patriots' Moss extended until after Super Bowl. [SI]

* Mortgage crisis may affect litigation departments. [WSJ Law Blog]

* U.S. jails Colombian FARC leader. [BBC]