Here’s some (more terrible) news that we don’t want to get passed over just because it’s late on a Friday.
We are hearing reports that a number of associates will be laid off from Greenberg Traurig today. As we understand it, the layoffs are focused in the New York office and are being conducted right now. They hope to be finished before the close of business today.
The firm declined to respond to an immediate request for comment, but our tipsters report that the Real Estate practice group is going to be hit the hardest. The numbers are too varied from our sources to be able to confirm how many associates are being let go today.
In terms of severance, tipsters have confirmed that the laid off associates will receive a two month package.
The new firm motto of Greenberg is: “We’re Built for Change.” We hope the same can be said of their former real estate associates.
The legal community is still buzzing with reaction to the news of Orrick, Herrington & Sutcliffe’s layoffs of 40 attorneys — while White & Case sacrifices blood and treasure to the altar of “good timing.”
We don’t want to pile onto Orrick, we know a lot of good people that work there. But Ralph Baxter’s interview with the AmLaw Daily today is … a little weird.
Yesterday, we noted that Orrick’s layoffs come a month after they acquired a bunch of Heller Ehrman partners. Baxter addressed that issue specifically with AmLaw … depending on your definition of “addressed”:
What do you say to people who will look at your decision to hire 27 former Heller attorneys in early October, a month before this decision?
You take these two facts together (the Heller hirings and the layoffs), and you get a focused picture of Orrick. We’re bullish about the future, bullish about the role of lawyers in global finance, and we are boldly taking action to diversify Orrick’s practice. All of the Heller lawyers who joined us were in practice areas that are litigation-oriented. Compared with the layoffs, it’s apples and oranges. They are mostly partners, and they bring business with them.
Allow me to translate:
You see, there are these things called Apples. And man, let me tell you, Apples are the future. But unfortunately, there are these other things called Oranges, and Oranges are so obsolete, so yesterday. Really, IN THE FUTURE, the only thing Oranges will be good for is Juice. So we said, screw it man, let’s make some Juice. Let’s make some now! Because the future is now. Apples and Pulp bro’. Don’t sleep.
Other highlights from Baxter’s interview after the jump.
We received reports this morning that Orrick, Herrington & Sutcliffe was planning to make deep cuts into their structured finance, real estate and corporate departments.
We’ve been able to confirm that Orrick is laying off 40 associates and 35 staff members today. The structured finance and real estate departments are expected to be the hardest hit. Associates were notified by chairman Ralph Baxter via email (which included a video).
Despite Orrick’s refusal to respond to our multiple requests for comment all morning, we can also report that displaced attorneys are getting two weeks notice plus five months severance. That is better than the severance package offered by White & Case on Tuesday.
Orrick was willing to speak with the WSJ Law Blog. The firm told the WSJ that they tried to avoid cutbacks for as long as possible:
Throughout 2008, we have done all we could to avoid today’s action: we have redeployed lawyers to different practices and we have cut expenses. Unfortunately, our staffing levels in the affected practices still remained too high given the economic environment our clients and we face.”
While the firm contends that these moves were taken solely in response to the economic crisis, a tipster tells us that the real reason was “to maintain PPP [profits per partner] of $1.5 million in 2009.”
So sad — and surprising. Orrick, you might remember, was one of the first major firms to raise associate salaries to $160K outside of New York. After Orrick moved, the rest of California followed: Latham, Gibson, OMM, even Thelen (kind of).
Just last month, we reported on how some firms (including Orrick) were using the market downturn as an opportunity to acquire productive lawyers and good clients. Baxter was highlighted in the WSJ article. And two weeks ago, Orrick stood behind its previously announced 2008 bonus structure.
But apparently some people had to go. We understand that the layoffs will affect multiple offices.
Update (2 PM): The firm finally sent over its statement. Check it out after the jump.
We’ve received a ton of comments and many tips that “stealth” layoffs are happening at Kaye Scholer. One commenter claimed:
[S]ince last summer, by my count at least 8 associates left voluntarily, as did 5 paralegals. An additional 8 associates were laid off and 4 paralegals were laid off with them. It seems to me that the fact that none of these paralegals were replaced, coupled with the fact that the only new blood brought into the department were the new 1st years in 2007 and again in 2008 shows that perhaps its the partners that are “dead wood” and not the people that worked for them.
Another commenter offered these numbers:
I was in the RE practice group. The breakdown of who was let go is as follows (and this does not include those that left voluntarily because they anticipated the coming of Armageddon). Class of:
2006 – (2)
2005 – (2)
2004 – (1)
2001 – (1)
1998 – (1)
Counsel – (1)
and at least 5 paralegals were let go.
I anticipate that the class of 2007 is next to be “reduced,” as there are now no remaining people out of the 5 associates from the class of 2006 and only 1 out of the 4 associates of the class of 2005.
A tipster put it all together like this:
This doesn’t even include those in corporate that were let go… The lit associates, some of whom billed close to 3000 hours last year, have absolutely no work, and are not going to even get close to the 2000 hours needed to make first tier bonus. Word going round is that there will be a mass round of layoffs for the lit people that didn’t get snipped after the first round in May.
What exactly is going on at Kaye Scholer? A response to the rumors by managing partner Barry Willner, after the jump.
Given the fear and loathing going on in the associate market, we’ve been overlooking the fact that support staffers are getting eviscerated thanks to the global financial crisis. The White & Case bloodbath yesterday also hit 100 staffers. We’ve also reported on Alston & Bird’s attempt to force out older staff.
Many people have heard reports that K&L Gates laid off a number of staff over the past week. The firm has refused to comment about these layoffs, so we don’t yet know the full extent of the damage. But we understand that it has hit many, many people, across all offices.
We don’t understand why K&L Gates is trying to keep these layoffs secret. As many smart attorneys know, competent support staffs are critical to excellent legal work. Right now, the market for paralegals is probably even worse than it is for attorneys.
Whether or not you have evolved to the point where you can appreciate the crucial role staffs play in Biglaw offices, most people can agree that they deserve to be treated with respect — even on their way out of the door. One report from a K&L Gates tipster is therefore particularly disturbing:
[T]hey watched [me] pack [my] office and I was not allowed to say goodbye to anyone including a senior partner [I worked for]. … Escorted out of the building … very undignified treatment of a 15-year employee.
If you want to treat a temp secretary like crap, that’s terrible etiquette. Treating a colleague who has dedicated decades of service to the company like an industrial espionage convict is a whole different level of “class.”
The first news started to leak this morning about some terrible news at a top firm:
White & Case [is] currently calling people and laying them off. I haven’t heard anything in regards to scope, but [I] hear that it’s big.
Now that White & Case has had time to tell all of the affected associates, they are ready to talk about how deeply the cuts went. A firm spokesperson tells us:
As part of its planning for 2009, White & Case LLP is reviewing its global operations against current and anticipated market conditions and expected client needs. While the Firm anticipates a strong 2008, with significant revenue growth across our globally diverse network, we are exercising prudent business judgment and taking several steps in advance of what is likely to be a significantly weakened global economy in 2009.
Among these actions, the Firm is reducing its global legal and nonlegal headcount by about 3% from current levels, or notifying employees that they are at risk of redundancy. These reductions are being driven in large part by a decline in attrition rates. Those who have been asked to leave will receive a competitive severance package.
“We are living in a time of unique economic challenges, and well-managed, successful businesses, including White & Case, must assess their operations in light of current market realities,” said White & Case chairman Hugh Verrier. “We believe this is a necessary step to adjust to the global economic downturn and to ensure a strong, long-term future for the Firm.”
Upon information and belief — the firm did not give us specific numbers — 70 associates nationwide were let go.
Read about some associate reaction after the jump.
More bad news from Chicago today. The National Law Journal is reporting that the well known construction boutique, Stein, Ray & Harris, laid off a third of their associates:
The firm laid off four of its 14 associates this month after hiring seven attorneys earlier this year in anticipation of an increase in construction litigation linked to the economic downturn, said Robert Harris, a partner at the firm. The jump in such litigation “hasn’t materialized,” though it’s early in the cycle and that may change, he said.
Big firm lawyers, small firm lawyers, it’s bad for lawyers all over Chicago.
Clearly, the only safe job in Chicago is whoever works for Oprah.
Universities are not immune to the economic downturn. Endowments are taking hits; hiring freezes are likely.
And maybe layoffs, too. From a tipster:
CLS Dean of Career Services Ellen Wayne has just been unceremoniously dumped from her post after nearly 20 lackluster years on the job (she was a constant source of complaints by students). She’s already been removed from staff listings and from the school’s internal telephone and email directory.
We tried emailing Dean Wayne at her Columbia address and received an automated reply: “I am out of the office.” Indeed.
[T]hey’ve not managed to erase all traces yet…. Her picture remains up on the front page of their employer section. No official email from the school to its students yet.
We reached out to the school for comment. Elizabeth Schmalz, executive director for Communications and Public Affairs at CLS, responded via email: “It is university policy not to discuss employment matters in public. Thanks for writing.”
So it’s not clear yet what happened to Dean Wayne. Is she being blamed for weak on-campus interviewing this year? Was she somebody’s target in Assassins?
Our original tipster wasn’t a fan of Dean Wayne. But different CLS sources had more positive views.
Shearman & Sterling declined to comment on the rumors of “performance based” layoffs we reported on, yesterday. However, they did want to comment on our characterization of their faltering corporate practice:
The current environment has presented significant opportunities for Shearman & Sterling across its platform. We have been involved in many of the most complex situations that have arisen in recent months and continue to be active on a large number of those transactions throughout the world, including the sale of Merrill Lynch to Bank of America, Allianz’s sale of Dresdner to Commerzbank, numerous engagements for financial institutions and hedge funds arising under the Lehman insolvency (including our worldwide representation of Bank of America), and Hypo Real Estate in its German restructuring. We also have seen a substantial increase in the demand for our litigation and international arbitration practices. In response to your comments, activity levels in our Capital Markets practice have indeed slowed somewhat, as they have at all major firms, but other practices, as evidenced above, are very busy. Consistent with our normal practice, we are actively allocating associate staffing to areas of the firm where there is the greatest need.
So, there’s that. We’ll try to keep on top of how Shearman’s performance reviews go as they get started over the next couple of weeks.
As part of a nationwide tour, Above the Law is coming to the great city of Chicago.
Join preeminent law firm management consultant Bruce MacEwen, Katten Muchin Chicago managing partner Gil Sofer, and JPMorgan Chase & Co. assistant general counsel Jason Shaffer for a panel discussion (sponsored by Pangea3) on the evolutionary and market forces bearing down on the law firm business model. Come on by Thursday, November 20, at 6 p.m., for thought-provoking discussion, food, drink, and networking.
Space is limited and there will be no on-site registration, so please RSVP
Average law school debt for graduates of private universities hovered around $122,000 last year. With only 57% of new attorneys actually obtaining real lawyer jobs, recent graduates have a lot to consider when it comes to managing their student loan payments. Thanks to our friends at SoFi, today’s infographic takes a look at student loan debt, including the possible benefits of refinancing for JDs…
Kinney Recruiting’sEvan Jowers is currently in Hong Kong for client meetings and still has a few slots available through October 22. Evan will also be in Hong Kong November 14 to December 15. Further, Robert Kinney has been in Frankfurt and Munich this week and is available for meetings with our Germany based readers.
One of our key law firm clients has referred us to one of their important clients in the US, Europe and China – a leading global technology supplier for the auto industry – in order to handle their search for a new Asia General Counsel and Asia Chief Compliance Officer.
Kinney is exclusively handling this in-house search.
This position will have a lot of responsibility and include supervision of eight attorneys underneath them in the Asia in-house team. The new hire will report directly to the global general counsel and global chief compliance officer, who is based in the US. The new hire’s ability to make judgement calls is going to be as important as their technical skill set background.
The position is based in Shanghai and will deal with the company’s operations all over Asia and also in India, including frequent acquisitions in the region.
It is expected that the new hire will come from a top US firm’s Shanghai, Beijing or Hong Kong offices, currently in a top flight corporate practice at the senior associate, counsel or partner level. Of course, the candidate can be currently in a relevant in-house role.