Lateral Link

Ed. note: This is the latest installment in a series of posts on lateral partner moves from Lateral Link’s team of expert contributors. Scott Hodes is a Principal in Lateral Link’s South Eastern office. He utilizes his experience as a former partner to help partners and associates make lateral leaps in the Florida and Atlanta markets.

With the new year upon us, we look back at an exciting 2013 as we have witnessed a resurgence in the legal industry after enduring a rocky time during the recent recession. As economic and labor market conditions improve, many firms are seeing sustained signs of growth, especially in the South Florida market.

As evidence of this growth trend, one need not look any further than Miami-based Akerman Senterfitt, now known as Akerman LLP. With more than 550 lawyers and government affairs professionals, Akerman recently became the largest law firm in South Florida based on number of attorneys, eclipsing Greenberg Traurig. Akerman reported its third consecutive year of growth, with record gross revenues of $297.5 million and net income of $109.3 million for the 2013 fiscal year. From January 1, 2013, to date, 65 attorneys, including 19 partners, have lateraled in to the firm. During that same time period, only seven attorneys departed the firm.

double red triangle arrows Continue reading “Sunny Days Forecasted For Florida Market”

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.

What can we expect for the first quarter of 2014 in terms of the lateral partner market? As I have detailed before, the market is generally volatile and the rate of change of each month and quarter from year to year is difficult to predict. In our calculations, the number of lateral movements in December accounts for less than 20% of the variation in lateral movements in January. However, on average there are 2.4 times as many moves in January as there are in the previous December (but this ratio is subject to much volatility).

Let’s look at some data:

double red triangle arrows Continue reading “The Lateral Partner Market In 2014″

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.

Lateral matchmaking is hardly ever “love at first sight, at last sight, at ever and ever sight.” It is a rigorous process that requires a multifaceted approach to satisfy a multitude of criteria. If you are questioning the degree of your lateral attractiveness, allow me to explicate this below.

Each firm has a unique culture and looks for different traits in lateral partners. Nonetheless, most firms have a baseline, a minimum threshold a lawyer must meet in order to seem attractive, at least at first glance. There are always exceptions to these rules, but in general this threshold is encompassed by the following: profitability (e.g., portable business, bill rates, hours, and leverage); pedigree (e.g., law school); vintage; and for some firms, even GPA.

The first criteria is profitability. I will walk you through a quick example to explain the difference between two partners, then share with you a game that will let you assess your value as a lateral in today’s market….

double red triangle arrows Continue reading “Calculating Your Value As A Lateral Partner”

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.

“Do not go gentle into that good night, rage rage against the dying of the light.”

Dylan Thomas prophesied in his 1951 villanelle a prescient observation of aging leadership along with the corresponding succession planning hurdles a majority of laws firms face with their baby booming (or boomed) vintages.

Of the roughly 35,000 partners in Biglaw, roughly 4,700, (13%) of them are within a few years of or have surpassed (and then some) the mandatory retirement age. Lawyers 55 or older make up nearly 1/3 of practicing partners in the Am Law 200, a figure that will likely hold steady as the tail end of the baby boomer generation ages. Am Law 200 law firms have on average about 23.5 chairs, executive members, and senior partners whose 40-plus years of experience, client relationships, and leadership must be transferred to a new generation of rising stars. The process is hardly ever smooth and often involuntary.

Most partners in senior vintages begrudge the practice of mandatory retirement; some bemoan that it is an overcautious safeguard or the epitome of ageism. Some claim the practice is supported by scientific studies that link cognitive decline with advancing age — especially after 65, which is about the average for mandatory retirement. So how many law firms are prepared to deal with the void left by these partners?

double red triangle arrows Continue reading “Why Your Law Firm Needs A Partner Succession Plan”

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.

Merger season has arrived, yielding a fruitful harvest of potentially enormous mergers between Patton Boggs and Locke Lord and between Pillsbury and Orrick. Perhaps the most interesting aspect of these mergers is the potentially “super” practice groups these mergers will make.

Patton Boggs has recently undergone a period of mild strife, as we detailed several months ago. Though they lost a significant number of energy and environmental attorneys after the fallout of the Chevron litigation, this merger with Locke Lord could be effective not only as a stopgap, but could also vastly strengthen each firm’s energy department….

double red triangle arrows Continue reading “Recently Announced Law Firm Mergers Could Create Cascade of Lateral Moves”

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.

Near the entrance of the Calyon Building, the previous headquarters of Dewey & LeBoeuf, lies Jim Dine’s “Looking Toward the Avenue,” a triumvirate of headless statues inspired by the Venus De Milo. Where lie the visages of this homage to the prototypical form of Venus and furthermore, in the aftermath of Dewey, where have the pieces of this former empire landed?

Since May of 2012, there have been numerous articles inciting gossip and foretelling the troubles of Biglaw, but few have offered a retrospective of the overall trends in lateral moves from Dewey since the closure of the firm. The “largest winner” of the Dewey sweepstakes was Winston & Strawn, which added 23 partners (about 11% of those who moved in the final month), including Jeffrey Kessler, a titan of antitrust law who has represented every players’ union in the “big four” sports in the United States. Approximately seventy lawyers followed Kessler’s group.

Which other firms fared well in picking up Dewey lawyers?

double red triangle arrows Continue reading “Where Did Dewey & LeBoeuf’s Big-Name Partners Land?”

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…

double red triangle arrows Continue reading “Will The Lateral Market’s Clouds Part in 2014?”

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….

double red triangle arrows Continue reading “The State of the Lateral Lawyer Market”

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.

double red triangle arrows Continue reading “Litigation Reform Across The Pond”

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….

double red triangle arrows Continue reading “Predicting Lateral Leaps: When Do Partners Move — And Why?”

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