* Enjoy your Biglaw bonuses now, because according to managing partners, layoffs and de-equitizations may soon be making their return. Oh, only in Pennsylvania? Woohoo, break out the bubbly! Just kidding, that really sucks if it’s true. [Legal Intelligencer]
* The Environmental Protection Agency has temporarily banned BP from entering into future U.S. government contracts because of the company’s “lack of business integrity,” aka the Deepwater Horizon explosion. Ouch, super sick burn, EPA! [National Law Journal]
* Considering going to law school? Then you should also take into consideration the fact that you’ll have to become a lawyer if you want to stand a remote chance of ever being able to pay off your loans. [Fox Business]
* Paul Ceglia pleaded not guilty to fraud charges yesterday in federal court. If only he actually owned half of Facebook as he claims, he probably wouldn’t have a court-appointed attorney representing him. [Bloomberg]
* “No matter how many high-priced lawyers and publicists she employs, she has been exposed for what she is.” Jill Kelley’s lawyer is on the offensive, and his targets are none too pleased about it. [Associated Press]
* Avvo has decided to sell its health business to focus entirely on providing services to lawyers and legal customers. Now the company will be able to do the law justice. (SWIDT?) [Puget Sound Business Journal]
Ed. note: This is the first in a new series, “Across the Desk,” from Bruce MacEwen and Janet Stanton of Adam Smith Esq. and JDMatch. “Across the Desk” will take a thoughtful look at recruiting, career paths, professional development, human capital and related issues. Some of these pieces will have previously appeared, in slightly different form, on AdamSmithEsq.com.
As noted in the American Lawyer recently, the lateral recruiting boom of recent years continues unabated. As the Am Law article points out, “At the same time [as they’re focused on hiring lateral partners], firms appear to be homing in on their poor performers. Nine out of 10 survey respondents said their firm has ‘unprofitable’ partners, and seven out of 10 said their firms have partners at risk of being deequitized or ‘put on performance plans.’ As one survey respondent put it: ‘There are too many partners without sufficient billable work.’”
Now, wouldn’t you think it would make sense — if firms are worried about underperformers — to pay some attention to associates as well as partners? After all, some of those associates should, speaking theoretically at least, be your future partners.
Yet there’s unrebutted evidence that firms look at the wrong criteria when hiring associates….
Ed. note: This is the first installment in a new series of posts on partner issues from Lateral Link’s team of expert contributors. Today, Larry Latourette, Executive Director – Partner Practice, brings us his insights on what it’s like to practice law in the era of mandatory retirement, and how older partners can make a lateral transitions to new firms.
When I first met “Mark” for lunch this summer, he appeared to be in his mid-fifties, in excellent health, and talked about his competitive tennis game, needing to put his teenage kids through college, and his thriving legal practice that he couldn’t imagine giving up in the next ten years. In reality, Mark was 64, faced forced retirement from his firm in nine months, and wanted to know what his options were for moving laterally to another firm.
As a legal recruiter, I have met a growing number of lawyers like Mark who are bumping up against their firms’ mandatory retirement age. This trend will, in fact, accelerate over the next five years, for several reasons. Like other sectors of the economy, the Baby Boomers have had a dramatic effect on lawyer demographics. About 60 percent of law partners are now 55 or older, and by some estimates, a quarter of all practicing attorneys will be 65 or older by next year. At the same time the population is graying, however, it is also living longer. Especially with the increasing number of women in the legal profession, the life expectancy of lawyers who are 65 is now almost 20 years higher, with most of that time spent in good physical and mental health. Finally, the recent downturn in the economy has also caused some lawyers to postpone retirement as their nest eggs have dwindled.
Objectively, there is no question that most older lawyers are up to the challenge of practicing law….
* Dewey get to see a member of this firm’s chairman’s office strut for a perp walk in the near future? After all, partners reportedly say that it’s thanks to him that D&L may close up shop “as early as next week.” [Law360 (sub. req.)]
* De-equitize this: Oh, how Biglaw firms in America wish that they could return to merry old England, where mandatory retirement policies for old fart partners are the norm, and the courts agree. [Legal Week]
* “We’re about to beat a dead horse here.” Even the judge presiding over the John Edwards trial got pissed when the defense repeatedly asked variations of the same question on cross-examination. [MSNBC]
* Ain’t no shame in his game (well, actually, there is). Judge Wade McCree’s lawyer says he’s sure the judge is sorry for his sext messaging. Yeah, sorry he got caught. [Detroit Free Press]
* Is this the first test of the “ministerial exception” in the Perich case? A teacher at a Catholic school was fired for getting in vitro fertilization treatments, and now she’s suing. [CNN]
* Insert your own UVA joke here, bro. Yeardley Love’s family has filed a $30M wrongful death suit against former college lacrosse player, George Huguely V. [Washington Examiner]
* Since you’re so funny, crack some jokes about this one, Obama. Senate Republicans will be filing an amicus brief in support of a challenge to the constitutionality of the President’s recess appointments. [New York Times]
* Thanks to this Third Circuit ruling, you can rest easy knowing that you can rely on the First Amendment to protect your homemade sex tapes from all of those strict porn record-keeping and labeling requirements… for now. [Reuters]
* Due to Kelley Drye’s EEOC settlement, the New York State Bar Association is asking firms to end mandatory retirement policies. Because old folks need to make bank till they croak. [Thomson Reuters News & Insight]
* The ABA’s Commission on Ethics 20/20 has decided to ditch its proposal to allow limited nonlawyer ownership of law firms. Cue tears and temper tantrums from the likes of Jacoby & Meyers. [Am Law Daily]
* “If I believe that Chris Armstrong is a radical homosexual activist, I have a constitutional right to express that opinion.” Yeah, yeah, yeah. Tell that to the judge who dismissed your suit, Shirvell. [Detroit Free Press]
* Presenting “her royal hotness”: apparently Pippa Middleton has been seen cavorting around France with gun-toting lawyer Romain Rabillard, of Shearman & Sterling. [Daily Mail]
* The EEOC suit against Kelley Drye was brought “for a reason.” You hear that, Biglaw? Other firms with mandatory retirement policies better take a look at their partnership agreements and make some changes. [Am Law Daily]
* Media whore lawyers unite! Cheney Mason of Casey Anthony fame has come out of the woodwork to support George Zimmerman. Still waiting on vital impressions from Gloria Allred. Oh wait… [Naked Politics / Miami Herald]
* Just think, maybe if Planned Parenthood of Texas had taken Tucker Max’s money, they wouldn’t be suing the state for banning their organization from the women’s health program. Nah, they’d still be suing. [Reuters]
* Georgetown Law is planning to launch an executive education program, but don’t worry, they’re not going to be competing with Harvard. They know they’re the safety school in this scenario. [National Law Journal]
* Love will definitely make you do some really crazy things, like watch The Expendables. Or allegedly commit a murder-suicide because your husband might’ve had an affair. Things like that. [Atlanta Journal-Constitution]
* Kim Kardashian’s dubious defense of the day: “I’m Armenian and hairy.” The only-famous-for-her-sex-tape star is trying to use that as an excuse to get a lawsuit over a hair removal product dismissed. [Fox News]
* Well, at least somebody’s getting a spring bonus. A Biglaw firm has folded against the EEOC’s will on the de-equitization of partners. And all of the underpaid old farts at Kelley Drye & Warren rejoiced! [Bloomberg]
* Jets fans, are you ready for some football? That’s too bad, because no amount of Tebowing could have saved Reebok from settling this Nike suit. You’re going to have to wait for your damn jerseys. [WSJ Law Blog]
* George Zimmerman’s lawyers, Craig Sonner and Hal Uhrig, have dumped him as a client. They’re probably just pissed that the “defense fund” he set up wasn’t linked to their PayPal account. [Miami Herald]
* Marrying a terminally ill client who’s as old as dirt may seem like a great way to make some quick cash, but it’s more likely that you’ll just be disbarred. [San Francisco Chronicle]
* When you’ve been late to court so many times that a judge calls your behavior “premeditated, blatant and willful,” you better be ready to open your wallet. That’ll be $500; at least pay on time. [New York Law Journal]
* If at first you don’t succeed, try, try again — but only after a few years, banking on the off chance that the bar admissions people have forgotten about all the bad sh*t you did in law school. [National Law Journal]
* Frank Strickler, Watergate defense lawyer to two of President Nixon’s top aides, RIP. [New York Times]
* Well, this could definitely be one of the reasons why Cravath hasn’t given out any spring bonuses to associates yet this year. They probably had to spend all of their money to clean up their allegedly fly-infested cafeteria. [Am Law Daily]
* Women in Virginia will now be able to politely decline their pre-abortion transvaginal ultrasounds in favor of abdominal ones. Oh, how nice! Look at that, girls, we totally won the war on women. [CBS News]
* Things Dharun Ravi texted to Tyler Clementi on the night the latter committed suicide? “I’ve known you were gay and I have no problem with it.” Of course you knew, you watched his sexual encounters via webcam. [CNN]
If you think this economy is just kicking the asses of recent graduates, associates, and support staff, you are forgetting one critical group: partners without portable books of business. Those who make it rain are getting soaked with wealth, but everybody else is just trying to get a drink.
We’ve heard many stories about partners without business quietly being “pushed out” or de-equitized. But we rarely see an entire group of partners publicly “demoted” en masse.
Last week’s Am Law 100 list revealed publicly a trend that partners at big law firms have been feeling acutely: The largest law firms have de-equitized partners in the last two years in an unprecedented way. In the words of one of the articles, “Equity partner head count alone slipped 0.9 percent last year, after dropping 0.7 percent in 2009.” That trend may undermine the business models of some law firms.
Law firms have many and varied business plans and compensation systems. But one reasonable way to run a firm is to market your most marketable lawyers — concentrate business development in the folks best able to develop business. For that model to work, however, all partners must trust the institution. De-equitization reduces the necessary trust and may kick the stilts out from under this business model.
Here’s how the model works. If a potential new client asks your firm to respond to an RFP for litigation matters, you turn to your half-dozen heaviest-hitting litigators and decide which one will be offered up as the lawyer to lead the new engagement. You know that, if you’re invited to a beauty contest, the heavy-hitter will clinch the deal, because he’s clinched so many deals in the past.
If you read in today’s Wall Street Journal that the plaintiffs’ mass tort bar has just put another industry under seige, you spring into action. Pull together the firm’s marketing materials, identify lawyers with relationships in the relevant industry, draft up outlines of motions to dismiss and oppositions to class certification, assemble an outline of key issues and proposed responses, and then have your relationship lawyers call and email their client contacts, offering to have one of the heavy-hitters meet with the client to explain the firm’s capabilities. The heavy-hitter takes it from there.
If a corporate lawyer gets a serious litigation nibble, the corporate lawyer will naturally advise the head of litigation about the opportunity, so the firm can make an appropriate pitch. The head of litigation asks one of the heavy-hitters to lead the charge.
If a client asks a junior partner in the commercial trial department about the firm’s ability to defend a multi-billion dollar case, the junior partner reports up through the ranks. The firm puts together a response that proposes a talented litigation team to handle the case — led, of course, by one of the heavy-hitters.
This approach to running a firm isn’t crazy. To the contrary: Institutionally, this system makes a lot of sense. You offer up your most impressive lawyers to handle the most important opportunities, land the business, and distribute that business among the masses to keep everyone busy. Collectively, everyone at the firm benefits.
So you spent a considerable amount of time courting, selling and maybe even doing some friendly stalking of that attractive lateral partner candidate with a sizable book. After he or she ignored your emails and didn’t return your calls, a few weeks go by and you read a press release in the legal media announcing the recent move to a competing firm.
Rats. Another one got away from you. You cringe when you consider how much time was spent in meetings that did not bear fruit. Your heart aches when recall how you were led to believe this was a marriage made in heaven.
You have been rejected.
The sting of rejection is painful, even for fancy law firms. But you need to find a way that you can turn this disappointment into a legitimate learning experience.
No, this isn’t a pre-party before we come back next fall for the real thing. This IS the real thing. Quinn Emanuel is pushing the envelope on recruiting. The party is now. This is when you meet the partners and associates face to face. This is when we begin the dance that could land you an offer for your second summer BEFORE school starts in the fall.
First: You come to the party. Second: If you like us, you send your resume after June 1, 2014. Third: If we like each other, you get an offer.
We’re not waiting for fall. We’re not doing the twenty minute thing. This party is the real thing!
We hope you’ll join us, and look forward to meeting you.
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 protected].
Since late last year, things have been booming in Hong Kong / China in cap markets, especially Hong Kong IPOs. M&A deal flow has recently been getting a bit stronger as well. Although one can’t predict such things with any certainty, all signs are pointing to a banner entire 2014 for the top end US corporate and cap markets practices in Hong Kong / China. This is not really new news, as its been the feeling most in the market have had for a few months now and things continue to look good.
The head of our Asia practice, Evan Jowers, has been in Hong Kong for about 10 days a month (with trips every other month to both Shanghai and Bejing) for the past 7 months (Robert Kinney and Evan Jowers will be in Hong Kong again March 15 to 23), and spending most of his time there meeting with senior US hiring partners at just about all the major US and UK firms there, as well as prospective candidates at all associate levels and partner levels, and when in the US, Evan works Asia hours and is regularly on the phone with such persons, as our the other members of our Asia team. Our Yuliya Vinokurova is in Hong Kong every other month and Robert is there about 5 times a year as well. While we have a solid Asia team of recruiters, Evan Jowers will spend at least some time with all of our candidates for Asia position. We have had long standing relationships, and good friendships in some cases, with hiring partners and other senior US partners in Asia for 8 years now.
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