If you talk to law firm partners who are in charge of collecting fees, they’ll tell you that getting clients to pay has become a real hassle ever since the recession started. Clients are trying to make their books look as palatable as possible, and if that means avoiding or delaying payments to their lawyers, well, then that’s what they are going to do. Collecting fees from clients is one of the top concerns of Biglaw managers.
And it should be a top concern for Biglaw associates. Nobody is going to be getting a bonus when the firm cannot realize its profits.
You’d think every practicing attorney would be on the same page with this by now. You’d think, at the very least, every person would be diligently putting in their time to give their firm the maximum opportunity to collect on their billable hours. But apparently some people haven’t gotten the memo that putting in your hours in a timely fashion is critical in this environment.
Well, at Simpson Thacher, they want to know your hours, now. And the firm is threatening to bring the hammer down on attorney timekeepers who are putting off this important paper work. Put in your hours, or STB will hit you where it hurts — the wallet…
And this year, there’s a new name at the top. Baker & McKenzie leapfrogged a number of firms to become the top-grossing law firm in the world (based on 2009 revenue numbers). Baker narrowly edged out Skadden for this honor.
Of course, Skadden people shouldn’t be ashamed of their second-place finish. Baker & McKenzie is huge: it leads the Am Law list of most lawyers by more than a thousand over its nearest rival, Clifford Chance. Skadden ranks #9 on the “most lawyers” list, with an attorney headcount that is almost doubled by Baker & McKenzie. Skadden gets to #2 in the revenue rankings by having a much higher revenue-per-lawyer figure.
Let’s take a look at the top ten in terms of revenue, and drool over these billion-dollar businesses…
Yesterday we discussed the merger talks that are currently taking place between Akin Gump and Orrick. We solicited your views on a possible combination, and we received some interesting feedback (in the comments and by other means).
Let’s start with the happy stuff. Here are some positive takes on an Orrick / Akin merger, from the comments (yes, positivity in the comments — it happens):
“I have been at both firms and I believe it would be a good fit both geographically and practice-wise. Orrick is almost all about finance, and finance is one key area that Akin lacks real depth.” [FN1]
“#1 Vacuum company in America + #1 brand of cocktail shrimp = unstoppable legal force.”
But it’s not all vacuums and cocktail shrimp, sunshine and puppies. Insiders with knowledge of both firms also identified downsides to a possible Orrick / Akin merger….
People are talking about an interesting Slate article entitled “Leaving Big Law Behind: The many frustrations that cause well-paid lawyers to hang out their own shingles.” It’s currently the most-read piece on the site. But it’s actually quite similar, even down to some of the sources, to an article that appeared a few days earlier in Crain’s New York Business:
A lawyer’s hourly billing rate used to be a badge of pride — the higher the number, the more valuable (and supposedly brilliant) the lawyer. But over the past 18 months, a strange phenomenon has been sweeping the legal arena: Partners at major law firms are quitting because they want to be able to charge less for their services.
This is, of course, not a new development. Kash and I wrote about it in a December 2009 cover story for Washingtonian magazine, in which we interviewed a former member of the $1,000-an-hour club who left a large law firm and started his own shop so he could offer clients better value. But all the recent coverage — in Crain’s, Slate, and elsewhere — suggests that the trend is picking up steam.
Which kinds of lawyers are leaving Biglaw to hang up their own shingles? Why are they doing it? And how’s it going for them?
So perhaps it shouldn’t be surprising that a former Wachtell partner has gotten the best of his ex-wife in contentious divorce proceedings. Leigh Jones of the National Law Journal reports:
It may have been the result of some crafty legal maneuvering by a Wachtell, Lipton, Rosen & Katz partner, or it may have simply been part of his tempestuous marriage to a “European Playmate” nearly 30 years his junior. Whatever the reason, the now-retired partner has thwarted a second bid by his ex-wife to invalidate a prenuptial agreement and collect a share of the annual retirement payments that he receives from the firm.
The Appellate Court of Connecticut, in a decision released on Thursday, affirmed a divorce judgment between retired Wachtell partner Peter McKenna, now 72, and Roberta Delente, a one-time model from Brazil who was working for an agency called “European Playmates” when the couple met in 1997. She was 32 at the time.
The divorce judgment left Delente, from whom McKenna sought a divorce less than a year after their wedding in August 1999, with virtually nothing from the marriage.
Let’s cut to the question that everyone is curious about: How big is McKenna’s (retirement) package?
UPDATE: And how hot is Roberta Delente? We’ve added a photo — as well as a link to the appellate court’s opinion, but that’s less exciting — after the jump.
In April and May of this year, the Altman Weil consulting firm surveyed the leaders of 787 law firms with 50 or more lawyers about the state of the legal industry. After receiving responses from 218 of them (a 28% response rate), Altman Weil crunched the data and compiled it in a big law firm survey, which it published earlier this week.
The survey came out a few days ago and has been covered extensively in variouslegalnewsoutlets. But we weren’t in any great rush to write about it, since it doesn’t contain much to get excited about: many of the findings are (1) gloomy and (2) unsurprising.
To turn the Nixon Peabodytheme song on its head, these days it seems that “everyone’s a loser” in the world of Biglaw….
Are profits per partner the appropriate metric to measure law firm success? It’s been a long time since firms seriously looked at the question. I didn’t know my Skadden from my Sullivan back when American Lawyer founder Steve Brill first started shining a light on the black box of top American law firms back in 1987.
For as long as most of us can remember, PPP has been the definition of law firm financial success. And despite all of the pressure on the law firm business model over the past couple of years, PPP seems as resilient as ever. We can scream about the billable hour, we can change the nature of associate compensation, but there aren’t a lot of people giving us a better statistic than profits per partner to talk about when it comes to the success of the law firm business model.
Nooooo! Haven’t we learned that “too big to fail” is terrible? It’s bad for our economy when things are too big to fail — too often, too big means too inefficient to change:
Carrying dozens of offices through the worst recession in a generation might sound like a prescription for disaster. But heads of The Am Law 100′s most geographically diverse firms say that their business model is not only alive, but robust.
Have we learned nothing from everything that’s happened? Do these firms really think that the entire legal recession can be blamed on so-called “entitled” junior associates who had the audacity to accept the money firms were willing to pay them?
The American Bar Association is currently holding its Women in Law Leadership Academy in Philadelphia; prior to the conference, they surveyed female partners in regional and international firms. Harder for women than figuring out what they’re allowed to wear is becoming a partner. (Though there are signs that’s changing.)
Apparently, female lawyers must go elsewhere to be appreciated. Forbes summarizes:
According to the study, the majority of women who had made partner had to attain the position by making a lateral jump to another firm–few were promoted from within.
Once you make partner, it’s hard to stay one. Almost eight percent of the 700 female partners surveyed reported being de-equitized. How come?
The holiday season is upon us, and yet again, you have no idea what to get for the fickle lawyer in your life. We’re here to help. Even if your bonus check hasn’t arrived yet, any one of the gifts we’ve highlighted here could be a worthy substitute until your employer decides to make it rain.
We’ve got an eclectic selection for you to choose from, so settle in by that stack of documents yet to be reviewed and dig in…
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.
We currently have a very exciting and rare type of in-house opening in China at one of the world’s leading internet and social media companies. Our client is looking for an IP Transactional / TMT / Licensing attorney with 2 to 6 years experience. The new hire will be based in Shenzhen or Shanghai. Mandarin is not required (deal documentation will be in English) but is preferred. A solid reason to be in China and a commitment to that market is required of course. This new hire will likely be US qualified (but could also be qualified in UK or other jurisdictions) and with experience and training at a top law firm’s IP transactional / TMT practice and could be currently at a law firm or in-house. Qualified candidates currently Asia based, Europe based or US based will be considered. The new hire’s supervisors in this technology transactions in-house team are very well regarded US trained IP transactional lawyers, with substantial experience at Silicon Valley firms. The culture and atmosphere in this in-house group and the company in general is entrepreneurial, team oriented, and the work is cutting edge, even for a cutting edge industry. The upside of being in an important strategic in-house position in this fast growing and world leading internet company is of the “sky is the limit” variety. Its a very exciting place to be in China for a rising IP transactional lawyer in our opinion, for many reasons beyond the basic info we can share here in this ad / post. This is a special A+ opportunity.
If your firm is in ‘go’ mode when it comes to recruiting lateral partners with loyal clients, then take this quiz to see how well you measure up. Keep track of your ‘yes’ and ‘no’ responses.
1. Does your firm have a clearly defined strategy of practice groups that are priorities of growth for your office? Nothing gets done by random chance, but with a clear vision for the future. Identify the top practice areas for which you wish to add lateral partners. Seek input from practice group leaders and get specifics on needs, outcomes, and ideal target profiles.
2. In addition to clarifying your firm’s growth strategy, are you still open to the hire of a partner outside of your plan? I’ve made several placements that fit this category. The partner’s practice was not within the strategic growth plan of my client, but once the two parties started talking with each other, we all saw how it could indeed be a seamless fit. Be open to “Opportunistic Hires.” You never know where your next producing partner might come from, so you have to be open to it. I will be the first to admit that there is a quirky element of randomness in recruiting.
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