Lateral Hiring

Ed. note: This is the latest installment in a series of posts on lateral partner moves from Lateral Link’s team of expert contributors. Today’s post is written by Michael Allen, the Managing Principal of Lateral Link, who focuses exclusively on partner placements with Am Law 200 clients.

With the recent news of eight Weil partners in Dallas leaving for Sidley Austin and Wilson Sonsini announcing the elimination of 35 staff positions in Palo Alto, many are looking towards the fourth quarter with cautious optimism. Traditionally the fourth quarter is the most difficult to predict; even the most basic analysis of Q4 shows that there is little correlation between the rate of change in partner moves from the previous year, and the rate of change in total moves from the previous year (ΔP/ΔT). This essentially means that the total lateral moves over the course of the fourth quarter are an inadequate measure for estimating future lateral partner moves in the fourth quarter. However, gauging the first three quarters, this measure is highly effective, yielding a nearly 85% correlation year to year — compared to 44% in Quarter 4.

There are many factors that complicate lateral moves in the fourth quarter, the most conspicuous being bonuses. Every law firm has a method for compensating its partners. Some compensation plans are highly structured, but many others include subjective elements. Distribution plans incorporating percentages or units of participation with a reserve are often-times structured to incentivize an attorney to remain at the firm through the fourth quarter. Simplified, a partner will receive a variable draw and at the end of the year, and the balance of the net profit will be distributed. There is the general consensus that partners will wait to collect their bonuses at the end of the year before making a lateral move. This evidence may be anecdotal, but nonetheless lateral movements in the past have been about 30% greater in the first quarter compared to the previous fourth quarter…

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Congratulations to Morrison & Foerster. The firm just announced the launch of its first German office, built around all nine former Berlin partners of Hogan Lovells.

MoFo’s new German team is known for its expertise in Technology, Media & Telecommunications (TMT) transactional work. The Berlin office in the firm’s third outpost in Europe and its 17th office worldwide.

How is Hogan Lovells taking news of the departures? As the ABA Journal wondered in a headline, “Morrison & Foerster opens Berlin office; is Hogan Lovells miffed?”

It would seem the answer is ja….

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There’s no doubt about it: Weil Gotshal & Manges is the reigning drama queen of Biglaw. In June, the firm laid off 60 lawyers and 110 staffers. Last week, the firm lost eight partners to the Dallas office of Sidley Austin, including some pretty heavy hitters (and basically all of Weil’s women partners in Dallas).

Today we bring you (1) additional information about the Dallas moves and (2) a report from Weil’s Boston outpost, where some people are not happy….

double red triangle arrows Continue reading “Weil We Wait For More Big News….”

Ed. note: This is the latest installment in a series of posts on lateral partner moves from Lateral Link’s team of expert contributors. Today’s post is written by Michael Allen, the Managing Principal of Lateral Link, who focuses exclusively on partner placements with Am Law 200 clients.

On the surface, the state of the legal market looks grim; in the third quarter of 2013, lateral moves declined in almost every practice area in comparison to Q1 and Q2 of 2013 and the three previous Q3s. Although the legal sector added 2,700 jobs in August, there has been stagnation within the top 200 firms relative to the last few years. Compared to the last two years, lateral movement has dropped 29% since 2012, after having risen 5.5% from Q3 of 2011 to Q3 of 2012. When compared to the first two quarters of 2013, the drop is less dire. From the first quarter to the third, total lateral moves dropped 6.3% (not nearly as significant), and from quarter two to quarter three, lateral moves decreased by 13%.

Since Q3 is not yet over, we have assumed that the market trends will hold steady over the course of the next few weeks, and we used this inference to fill the gaps in our data. Analysis of past years’ data shows that this is not an unreasonable assumption. Our findings indicate that lateral movement during Q3 is especially weak when comparing these last two years. In 2012, 5,725 attorneys moved laterally (January 1 through September 18th), compared to 4,840 in 2013 — a 15.4% decrease. While the lateral market would be depressed even without Q3, the drop for the year to date would not be as significant. Of the top Am Law 200 firms, nearly 40% either hemorrhaged lateral attorneys or had no net gain. Despite this lateral recession, Lateral Link has increased its market share over the last year, placing even more candidates than the year before despite the otherwise static lateral market….

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“Who shot J.R.?” That was the question that everyone (hi Mom!) was dying to know on the wildly popular prime-time soap opera of Dallas.

“Who drove out Yvette Ostolaza?” That’s the question everyone is dying to know on the wildly popular prime-time soap opera of Weil Gotshal.

Okay, “drove out” is probably not the right phrasing here, for reasons we’ll explain below. But there’s no denying that people are keenly interested in the drama surrounding the departure of eight Weil partners to Sidley Austin in Dallas.

Let’s take a closer look at the situation, shall we?

double red triangle arrows Continue reading “The Weil Gotshal Dallas Departures: A Deeper Dive”

Ed. note: The Aspiring Lateral, a new series from Levenfeld Pearlstein, will analyze a variety of issues surrounding lateral moves, drawing on the firm’s experience in the lateral market as well as the individual experiences of LP attorneys. Today’s post is written by Laura Friedel, a partner in the firm’s Labor & Employment group.

In the legal profession, the view from the top is pretty good. If you’ve been lucky enough to snag a position at one of the 100 or so firms loosely defined as “Biglaw,” you’re probably looking out a window near the top of a shiny skyscraper. You probably have a nice cafeteria down the hall. Who knows: at your glam partner retreats, you may even take chartered boats down the Thames.

The point is, while that view from Biglaw is a good one, it’s not the easiest vantage point to assess your career options. I’ve been there. And when I began to think about alternatives to a Biglaw practice, I admit I did not fully realize that mid-sized firms even existed. In my mind, there were Biglaw firms, boutiques, and that’s about it. I was something like the native New Yorker who is only dimly aware that a mass of states lies between herself and the only other meaningful part of the country, California.

Thankfully, just as flyover states do in fact exist, so too do mid-sized firms that provide sophisticated, full-service capabilities to their clients. For the Biglaw practitioner facing rate pressure from clients, frustrations with the anonymity that goes with mega-firm practice, or perhaps nosebleeds from the trip up the elevator, they are worth considering along with obvious alternatives such as in-house positions.

And as Biglaw lawyers investigate mid-sized firms, they will likely find more misperceptions falling away. I’ll share a few here that opened my eyes further, and that make the mid-sized firm alternative an attractive one…

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Some of our older readers may, like me, remember the television show Dallas. This deliciously dishy, prime-time soap opera was packed with suspense, drama, and conflict.

Suspense, drama, and conflict have also haunted the high-powered law firm of Weil, Gotshal & Manges this year. In June, the firm conducted major layoffs, which shocked the legal world due to Weil’s profitability and prestige. In April, Weil lost some prominent litigation partners to Quinn Emanuel in D.C., amid significant controversy.

So it’s fitting that today’s juicy story comes from the Dallas office of Weil Gotshal, which just lost a slew of partners to a rival firm under interesting circumstances….

(Please note the various UPDATES added to the end of this post.)

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Ed. note: This is the latest installment in a series of posts on lateral partner moves from Lateral Link’s team of expert contributors. Today’s post is written by Michael Allen, the Managing Principal of Lateral Link, who focuses exclusively on partner placements with Am Law 200 clients.

A day in the life of an English litigator just got considerably more complex. Lord Justice Jackson’s year-long appraisal of English litigation ended in 2009 and culminated in a set of new rules dubbed the Jackson Reforms. These eponymous reforms are being heralded as revolutionary, yet the full impact of the reforms has yet to be ascertained. While opinion is divided on the impact of these reforms, we have seen a very tangible ripple in the frequency of U.K.-based movement from litigation partners over the last few years.

As you are all aware, the U.S. legal system is based on British Common Law. While many facets of our systems are congruent, litigation financing diverges significantly between the two countries.

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Firms generally celebrate when they make lateral hires. They trumpet the new arrivals with press releases, invoking themes of growth, expansion, and an enhanced ability to serve clients.

For folks who are already at a firm, however, could lateral hiring have a downside? Could it possibly result in layoffs of existing employees?

Our latest layoff story raises this possibility….

double red triangle arrows Continue reading “Nationwide Layoff Watch: Lateral Hiring Leading To Layoffs”

Ed. note: This is the latest installment in a series of posts on lateral partner moves from Lateral Link’s team of expert contributors. Today’s post is written by Michael Allen, the Managing Principal of Lateral Link, who focuses exclusively on partner placements with Am Law 200 clients.

You would think that most lateral partners climb the proverbial Am Law 200 ladder to the “Holy Grail,” but our research has shown that predicting partner moves is not merely an exercise in linear extrapolation. Instead, myriad factors are relevant in predicting when and where a partner is likely to move.

Though the basic Am Law rankings are enormously useful in many aspects, they fall short in predicting lateral movement, at least if one adheres to the conventional wisdom that “bigger is better.” We have instead found that, on average, a lateral partner tends to move to a firm ten rankings below their previous firm. This is why we utilize a smorgasbord of other indicators, including PPP (profits per partner), firm reputation, practice size, and other analytics, to better match candidates to firms.

The foremost objective is to predict partner moves, which is why we utilize advanced statistics in our database to assess the likelihood of partner moves….

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