Bankruptcy

Law school’s epitaph?

* Hiring a Supreme Court clerk might not be worth a $500,000 gamble for some Biglaw firms. Some will take that sweet sign-on bonus and remove their golden handcuffs before a year is out. [Capital Comment / Washingtonian]

* Akin Gump partner and D.C. Circuit nominee Patricia Millett won approval from the Senate Judiciary Committee by a margin of 10-8 along party lines, and now her nomination will head to the full Senate for a vote. [Huffington Post]

* President Obama nominated Michelle Friedland and John Owens, two young Munger Tolles & Olson partners, for seats on the Ninth Circuit. If confirmed, that’ll make three partners from the same firm on the bench. [The Recorder]

* Sorry, law firms, but it’s no longer cool to inflate hourly billing rates for contract attorneys when you pay them substantially less. You can thank Ted Frank for this judicial revelation. [WSJ Law Blog]

* The ABA Task Force on the Future of Legal Education thinks that just about everything having to do with law schools is “deeply flawed” and needs “serious re-engineering.” How comforting. [ABA Journal]

* Law School Transparency is willing to assist schools with the reporting of their ABA post-graduation job placement statistics, for a price. How much is integrity worth these days? [National Law Journal]

* For $25K, Casey Anthony’s bankruptcy trustee won’t make her sell the worldwide rights to her story — like her theory of the crime she was acquitted of, it “exists solely within [her] mind.” [Sun-Sentinel]

* Daniel Chong, the student that the DEA locked in a cell and forgot about for a few days, has settled his lawsuit against the government for $4.1 million. No snark here, congratulations. [CNN]

* Meanwhile, O.J. Simpson is getting parole (but not quite getting released yet). Here comes Naked Gun 4! [ABC News]

* A Kenyan lawyer is challenging the trial of Jesus Christ at the International Court of Justice. [Legal Cheek]

* Professor Paul Campos notes that from 2004-2013, it’s gotten much easier to get into law school. This year 80 percent of students applying to law school will get in somewhere. At least the profession is upholding its high standards. [Lawyers, Guns & Money]

* DMX declared bankruptcy because bankruptcy actually makes it easier to get a passport. How is DMX broke? Are the residuals from Exit Wounds not paying the bills? [Grantland]

* King & Wood Mallesons and SJ Berwin LLP are merging to create one of the largest law firms in the world. Dewey think a merger is a good idea? [WSJ Law Blog]

* A follow-up on a previous item, checking in on the status of the petition to save the federal defenders one week in. [PrawfsBlawg]

* A profile of the “eighth governor” of the Federal Reserve and Georgetown Law grad, General Counsel Scott G. Alvarez. I would say this is a fascinating look at a prominent regulatory staff member, but the article makes it clear that “regulation” is not exactly the Alvarez agenda. [DealBook]

* Watch the dean of a law school defend a 0 percent bar passage rate. [ABC 33/40]

* Another new resource out there — LawTrades. Basically, it’s ZocDoc for lawyers where lawyers can register and prospective clients can search for an attorney who meets their needs. [LawTrades]

* What are the greatest legal novels of all time? The ABA Journal assembled a panel including our own David Lat and provided a list. You can disagree, but I see one of Archer’s favorites made the list (clip after the jump)…

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This weekend, I had the unenviable task of going on Fox News and “defending” Detroit. I wasn’t sure what I was supposed to be defending: poor city government, white flight, crumbling infrastructure… the best thing anybody can say about Detroit right now is that Miguel Cabrera is still sober. My solution was to sell Detroit to Canada. Our neighbors to the north seem to do a better job of providing civic services in a business-friendly environment without the kind of gridlock and recriminations that dominate every “solution” ever offered to Detroit’s long-standing problems.

Understand, this is a city that can’t even file for bankruptcy without getting dragged into legal quicksand. Former Jones Day partner Kevyn Orr was named Detroit’s emergency financial manager just four months ago. Evidently, it doesn’t take long to look at Detroit’s books and cry uncle, but now a judge is trying to block Orr and the city from restoring financial sense.

Don’t worry, as usual there will be people making money in Detroit. It just won’t be the people who actually live there…

double red triangle arrows Continue reading “Time For The Lawyers To Pick At The Carrion That Is Detroit”

* Though she be but little, she is fierce! Under Mary Jo White’s guidance, the Securities and Exchange Committee is now cracking down on financial fraud with a vengeance. [DealBook / New York Times]

* When a Biglaw firm’s chairman skeptically says, “Uh, OK, I mean, maybe,” with regard to a future increased demand for legal work, you know things are bad. We’ll have more on this later today. [New Republic]

* With Detroit’s downfall, vultures are swooping in left and right to snag clients. Firms retained thus far include Weil Gosthal, Arent Fox, Kirkland & Ellis, Winston & Strawn, and Sidley Austin. [Reuters]

* “I’m not a 100% sure this is legal.” Two law professors have come up with a revolutionary way for law students to finance legal education that sounds like it just might work. [WSJ Law Blog (sub. req.)]

* Normally when Biglaw firms and legal departments go to court over contested litigation, something’s gone wrong, but this summer, they’re trying to do some good in the world. [National Law Journal]

* Soon, it’ll be known as Western Michigan University Thomas M. Cooley Law School, but even with a new name, you’re still going to be Cooley, and there’s no recovery from that. [Lansing State Journal]

* In Greenwich, Connecticut, the fact that people buy homes where they want their kids to go to school isn’t a “complicated concept.” The schools’ racial diversity, on the other hand, is. [New York Times]

In fairness, only one legal story dominated the week. The Zimmerman verdict provided a new twist daily. It even got Kim Kardashian involved, which was a relief to the unwashed masses waiting to hear how a spoiled sex-tape star would react to a verdict at the intersection of race and gun policy.

But the most newsworthy verdict in years was not the only thing happening this week, regardless of what CNN would like you to believe…

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* Under the leadership of emergency manager Kevyn Orr, Detroit is now the biggest U.S. city to declare bankruptcy in history. Unfortunately, not even the strict Jones Day dress code could save them. [Am Law Daily]

* As one of our columnists David Mowry told us weeks ago, New York wants to close the justice gap by looking to the state’s best untapped resources for pro bono work: in-house counsel. [New York Law Journal]

* It turns out the “new employer survey” to be used by U.S. News is really just the old employer survey that’s been used in the rankings since 1990. How incredibly anticlimactic. [Morse Code / U.S. News & World Report]

* Law schools are officially ready to scrape the bottom of the barrel when it comes to filling their classes. Some are now accepting first-time June LSAT scores for fall admission. [National Law Journal]

* Our managing editor, David Lat, comes to the defense of fictional representations of the law, but seeing as he’s writing a fictional legal novel, we think he’s kind of biased. [Room for Debate / New York Times]

* Mobsters really don’t like rats, and it looks like someone who was planning to testify against Whitey Bulger may have been whacked after having been dropped from the prosecution’s witness list. [CNN]

* J.K. Rowling’s outing as The Cuckoo’s Calling (affiliate link) author Robert Galbraith has rendered print copies of the book scarce and a hot collector’s item. Now Rowling is hurling Cruciatus curses at her lawyers as the source of the revelation. [The Guardian]

* The New York Times weighs in on the worth of a law degree debate and makes Elie’s day by labeling him “indomitable.” [DealBook / New York Times]

* After the Ninth Circuit struck a tone of sanity, federal bankruptcy judges in Michigan and Tennessee remind us that law school debt is forever. [The National Law Journal]

* The hottest barristers in London. Meh. Holding out for the hottest solicitors countdown. [Legal Cheek]

* A lawyer should get suspended for smuggling stuff out of prison for a client. But shouldn’t the punishment be a tad more severe for smuggling a HIT LIST out of prison for a client? [Mercury News]

* The Ten Competencies that law schools should teach. I’d add “understanding how to order from Seamless at 4AM,” but otherwise it’s a solid list. [Associate's Mind]

* Penn State has approved a $60 million settlement in the Sandusky cases. Which is less than the football program makes in a year. [Deadspin]

* Apparently, the laws and other conditions surrounding America’s oil industry make it only the fifth friendliest place to extract petroleum in the world. Thanks a bunch you granola-eating socialists. [Breaking Energy]

* It’s not over yet, but the current projection for law school applicants this year is 59,200. My response to those fresh young go-getters after the jump…

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* Edith Windsor’s lawyer said she thought her client’s case was “simple,” but it proved to take a little longer than she thought to strike down the Defense of Marriage Act. [New York Law Journal]

* Conservative pols are up in arms about the SCOTUS decisions, promising to file constitutional amendments, but like Rand Paul said, “As a country, we can agree to disagree.” [Washington Post]

* Nate Silver breaks down gay marriage by the numbers. By August, 30% of Americans will live in states where same-sex marriage has been legalized. [FiveThirtyEight / New York Times]

* Wherein the ancient artifacts of a once storied and prestigious Biglaw firm are touted by a furniture liquidation company as “like new, for less!” Dewey know how embarrassing this is? [Am Law Daily]

* Sorry, Joel Tenenbaum, but the First Circuit affirmed your $675K debt to the RIAA. That’s what happens when you blame illegal downloads on burglars and foster kids. [Law & Disorder / Ars Technica]

* It looks like David Boies claimed two victories yesterday. The Court of Federal Claims gave Maurice Greenberg the green light to sue the U.S. over the terms of AIG’s bailout. [DealBook / New York Times]

One of the more amusing law firm nicknames belongs to Weil Gotshal & Manges. As we noted a few years ago, some refer to the firm as “We’ll Getcha & Mangle Ya.”

Alas, the nickname is less funny in the wake of yesterday’s big layoff news. The firm announced it will be cutting 60 associates and 110 staffers from the payroll. Despite the generous six-month severance for associates, some probably feel like their legal careers have been mangled. The firm also plans to reduce the compensation of about 10 percent of its partners (roughly 30 out of 300, some income and some equity partners).

Let’s take a closer look at the layoffs and try to make sense of them….

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Since the Supreme Court’s ruling in Fisher, the major affirmative action case, turned out to be something of a dud, the big legal story of the day is the news out of Weil Gotshal. The firm is conducting large layoffs of both attorneys and staff, as well as reducing partner pay.

Thus far, many of our recent layoff stories have involved staff layoffs, especially secretarial layoffs; relatively small numbers of affected individuals; and firms not in the tippy-top tier of Biglaw. So that’s what makes the Weil news so notable — and so frightening.

Weil is an elite firm, in both profits and prestige. The cuts it just announced affect lawyers, not just staff, and reach into the triple digits….

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