Layoffs

In early July, we broke the news that Cooley Law School would stop accepting first-year students at its Ann Arbor campus and would begin conducting faculty and staff layoffs due to continuing declines in both enrollment and revenue. At the time, the school had “no plans” to completely close the campus.

At the end of July, however, Cooley Law notified its Ann Arbor students there may be a “possible consolidation” of that campus with other Cooley campuses, three of which exist in Michigan.

It’s now mid-August, and the foreboding promise of layoffs has finally come to fruition. How many heads will roll thanks to this law school’s “right-sizing” plan? Our sources say the damage is “massive”…

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For some reason, very few law firms are prepared to deal with the headcount issues. It is interesting because the reaction from them also is peculiar. I think it was reported—I don’t know, maybe 12 months ago—that Weil Gotshal had a significant layoff of lawyers. They reduced—I think it was their associates, but maybe it was of counsel as well—and there was quite a negative reaction in the press to that.

I am not privy to any of their numbers or anything that is going on in the firm, but, as a restructuring person, my reaction is, “Look, this is someone getting their house in order. This is an appropriate thing to do.” It is no secret that revenues across the industry are down. And, so, you either need to take market share, or you need to right size your organization.

Joff Mitchell of Zolfo Cooper, during an interview with David J. Parnell of Forbes, speaking about how layoffs are frowned upon in Biglaw.

(For the record, Weil laid off 60 associates — about 7 percent of its associate ranks — and 110 staff members, about half of whom were legal secretaries.)

In a recent survey, managing partners of large law firms expressed tepid expectations about demand for legal services. So it’s not surprising that cost cutting — or, to put it more nicely, expense-management initiatives — remain popular in Biglaw.

Who’s the latest major law firm trying to reduce its payroll through a voluntary retirement program?

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Get out while you still can!

If you’ve managed to jump onto the speeding “now is a great time to apply to law school” train, then you might want to fling yourself from the tracks, because that thing is about to derail. We’ve got some major news from a law school that’s stereotypically regarded as one of the worst in the country. If you thought things were bad for law schools, you ain’t seen nothing yet.

The legal academy has been waiting with bated breath for something like this to happen, and now it finally has. A law school is cutting an entire class year from its enrollment logs at one campus and laying off faculty and staff — all at the same time.

Which law school seems to be in full on disaster mode right now?

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* The SCOTUS decision in the Pom Wonderful case could have serious repercussions in terms of deceptive labeling litigation under the Lanham Act. Even Justice Kennedy was misled! [Huffington Post]

* Dewey know when to WARN people? This failed firm apparently didn’t, and now it has to pay a $4.5 million class-action settlement to the employees it laid off without adequate notice. [WSJ Law Blog]

* After getting bumped out of the Am Law 100 after a 17-year run, Shook Hardy & Bacon is letting go of three floors of office space it “no longer needs.” Secretaries Paper takes up a lot of room! [Am Law Daily]

* Minutes after this career criminal was released from jail due to his accidental acquittal, he was stabbed to death with a steak knife. But for the jury’s crazy mistake, he would still be alive. Yikes. [Fresno Bee]

* LMU’s Duncan Law, perhaps better known as the little law school that couldn’t, is still trying to get ABA accreditation. At least this time they’ll be able to use law schools’ national decline as a scapegoat. [WBIR]

The arrival of summer associates brings good news for the permanent lawyers and staff of Biglaw. Not only do summer associates infuse their firms with youth and beauty (and opportunities for free lunches), but they serve as an amulet of protection against the layoff spirits.

Yes, summer programs have shrunk dramatically since the pre-recession glory days. Check out this sobering infographic for a powerful illustration.

But for those folks lucky enough to land summer associate positions, the odds remain high that they will get offers (unless they misbehave). And firms want those offers to be accepted, so they try to present themselves to summer associates as shiny happy workplaces. Layoffs, whether of lawyers or staff, are kind of a buzzkill. Firms prefer to conduct them before or after their summer programs.

So perhaps this latest news will be our last layoff reporting for a while. Which firm just made double-digit cuts to its ranks?

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Nothing brings out the knives more than losing jobs, and as a law school looks to send tenured faculty packing, the knives have come out in force.

A trustee defending the dean ripped the faculty using words like “smear campaign” and “mudslinging.” A professor countered saying the dean’s “leadership style is creating fear, a hostile work environment.” Well, looks like these kids are getting along swimmingly. This is what we have to look forward to all over the country as the law school bubble bursts and topples law schools all over.

In the meantime, let’s enjoy the public backbiting of Bravo’s new series, The Real Law Professors of…

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We’re midway through Biglaw’s second quarter, and this will be the third week in a row we’re covering law firm layoffs or buyouts of some variety. This just goes to show that no matter how well a firm does, it’s always looking to do better, and the easiest way to do so is by managing human expenses.

Sometimes the firms attempting to trim their ranks are members of the “Super Rich,” with high revenues per lawyer (at least $1 million) and even higher profits per partner (at least $2 million). Other times, these firms are rich but not super-rich — firms that generally saw “modest, hard-won gains” last year, according to the American Lawyer.

The firm we’re writing about today falls into the latter group, with relatively small financial gains in 2013. Despite this, it’s still offering “very generous” packages to inspire employees to walk away….

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It was just last week we were informed that the firms designated as “super rich” among all other Biglaw firms — specifically, the 20 with profits per partner of $2 million or more and revenue per lawyer of $1 million or more — were only getting richer.

That being the case, we can’t imagine that these Biglaw titans are hurting for cash, especially when the chasm between the super rich and everyone else keeps growing wider and wider.

This is why we were shocked to find out that the top-tier law firm recently revered for having the best brand in the business was trying to trim its ranks with offers of buyout packages…

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The first quarter of 2014 was relatively good for large law firms. But that hasn’t stopped major firms from trimming their ranks. In fact, some of the strong performance in the first quarter appears to be attributable to prudent management of expenses — including employee compensation.

This week brings word of still more layoffs. The latest reduction is sizable, affecting about 40 employees.

Which firm is making the cuts, and what is the mix between lawyers and staffers?

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