Young Conaway Stargatt & Taylor
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It’s one of the few things still shrouded in secrecy at most firms: which partners have equity in the firm and which don’t. Actual partners, of course, get a share in the firm’s profits, and are part of the PPP calculations reported by Am Law. Non-equity partners get the partner honorific, but in actuality they’re often just glorified senior associates, at least when it comes to matters like salary and major firm decisions. (Of course, this varies from firm to firm.)
Being a non-equity partner can be nice. You generally don’t have to toil on management committees or get caught up in partnership politics, and you may be less personally exposed to financial fallout should the firm’s fortunes sour (assuming the equity partners made personal guarantees on loans). But being a non-equity partner is also like being a stepparent that the children don’t respect. You don’t have any real power and don’t get to reap the full rewards from your investment and care.
Women and minority groups have tried to put pressure on firms to reveal partners’ equity or non-equity status when it comes to diversity reporting. But firms have resisted, saying that they don’t want to stigmatize non-equity partners. Angela Onwuachi-Willig sums it up on Concurring Opinions:
Over the past two years, the National Association for Law Placement (NALP) has tried to obtain information regarding the breakdown of equity and non-equity partners by gender and race at law firms. The majority of NALP’s law firm members refused to hand over the information, and NALP eventually gave in on February 12.
The Executive Director of NALP, [James] Leipold, indicated that most firms cited privacy concerns for not divulging the details of their equity and non-equity partnership breakdowns. According to Leipold, small firms especially worried that providing such information would allow non-equity partners to be easily identified and stigmatized.
Well, Delaware firm Young Conaway Stargatt & Taylor has revealed who its non-equity partners are, though it did so by accident. The firm’s controller needs a little lesson on the use of “bcc”…