Weil Gotshal

Morning Docket 04.16.09

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yankees above the law.jpg* The NYCLU is suing the NYPD to protect Yankees fans’ right to hate America. [Gothamist and New York Law Journal]

* Massachusetts U.S. Attorney Michael Sullivan is resigning this weekend. Among those gunning for his job are two Foley Hoag partners: Michael B. Keating and Martin Murphy. That’s a little awkward when it comes to intra-firm politics, no? [Boston Globe]

* Former ATL ‘Lawyer’ of the Day Howard Kieffer was back in the courtroom this week, being convicted of mail fraud and making false statements. [Associated Press]

* Easter’s celebration of resurrection has inspired Eliot Spitzer. He’s contemplating another run for Attorney General. [New York Post]

* Earlier this week, a judge ruled that law firms need to make it clear that they are representing the company and not individual employees during the course of their investigations– Irell & Manella was on the short end of that ruling. Stanford Group’s former CIO was likely following that case closely. She has filed a malpractice and conspiracy complaint against Proskauer Rose and others for the same practices. [Courthouse News Service]

* More on the monster $55.1 million Lehman bill submitted in Manhattan bankruptcy court by Weil Gotshal. In addition to over 100,000 billable hours over four months, the bill includes “$200,000 for business meals, $439,000 for computerized and “other” research, [and] $115,000 on local transportation and $287,000 on duplicating charges.” Sigh. Just when Americans were starting to hate bankers more than lawyers. [Wall Street Journal (subscription)]

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Letter from London: Where Magic Happens

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Letter from London Queen.JPGEd. note: The legal world is much bigger than New York, or Washington, or even the United States. Welcome to Letter from London, a weekly dispatch from the other side of the pond. Our U.K. correspondent, Isaac Smith, will expose ATL readers to the latest goings-on in the London legal world. You can reach Isaac by email, at isaacsmithlondon@googlemail.com.

The G20 summit, accompanied by its anti-capitalist sideshow, arrives in London this week – and UK Big Law is feeling a little scared.

Law firms are warning employees not to wear suits on Wednesday or Thursday so as to avoid being targeted in the violent protests planned around London’s financial district.

Which provokes an interesting question: how ghetto does a corporate lawyer need to dress in order to avoid arousing suspicion as to their true identity?

We’ll soon find out.

It all seems a bit unfair, really. It’s not as if lawyers got the super big bonuses. And now their salaries are actually falling. If those nasty anti-capitalists had bothered to have a quick scan of The Lawyer last Wednesday, they’d have seen that Shearman & Sterling’s London office had followed Freshfields in cutting newly qualified associate salaries by 8%.

Are we going back in time? More after the jump.

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Weil Gotshal Almost Sets the Market With Incoming First Year Associate Deferral Dollars

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Weil.gifAlmost a month ago, Latham & Watkins set the market in terms of incoming first year deferral programs Latham offered $75K to associates who saw their start dates with the firm pushed back for a year.

Many firms have followed, but none have topped. Today, Weil, Gotshal & Manges is taking a run at Latham’s high water mark.

A tipster reports sent us a Weil memo that announces the firm’s new deferred start date program. It’s a bit complicated. Weil is pushing back the start date for all incoming associates until January, 2010. But, in addition to bar expenses, the firm will be paying associates $15,000 in September 2009. That is more than anybody else who has deferred start dates to the first of the year.

But Weil is also asking associates to volunteer for have their start dates pushed back until January, 2011. Yes, I said “2011.” That would be longer than any firm (at this point) is asking its incoming first years to wait. However, if associates push back until 2011, Weil will give you $75,000 — if you work for a firm approved public interest organization — on top of the $15K they will receive in September, 2009. Should an associate choose not to work for that time, Weil will offer $60,000 (on top of the initial $15K).

That is not all that is happening over at Weil today. More details after the jump.

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Weil Gotshal Associate Shown the Door for Failure To Graduate From Law School

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Weil.gifWe’ve often explored the studio space in terms of what a “performance-based layoff” actually means. But today we can report about at least one person who would have been fired in this market or any other.

According to multiple sources, both inside and outside Weil Gotshal, the firm recently fired an associate for failure to graduate from law school.

How did this escape the notice of Weil personnel? How was he outed? What was he thinking?

Well, Weil did not respond to our requests for comment. But we imagine that it is not unusual for firms to hire a summer based on 1L grades, make them an offer when the summer is over, and then never really look at a transcript again.

What we do know is that the associate “attended” NYU Law School. Tipsters report that he then did some study abroad and thought his credits would transfer back over to NYU. They did not. He never made them up, hence, no diploma, no graduation.

But this story is a little beyond a technicality. More details after the jump.

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Profits Per Partner Up at Weil:
(Or ‘D’uh: Weil Makes Money’)

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Weil.gifFrom the department of obvious, Weil Gotshal & Manges managed to make lots of money last year. Gross revenue and profits per partner are up at the firm. AmLaw Daily reports:

Recession or no, Weil’s partners are far from suffering. Profits per equity partner were up 7.5 percent to $2.3 million, while the number of equity partners splitting the pie shrank for the second year in a row, from a high of 200 lawyers in 2006 to 184 in 2008.

We’re not sure how these numbers affect the tech stipend.

The strong profit numbers and high profile work still left associates with only Half-Skadden bonuses, but Weil has not historically been a market leader when it comes to that aspect of associate compensation.

Perhaps there is a good reason for that, revenue per lawyer actually went down at Weil in 2008:

Gross revenue at Weil, Gotshal & Manges rose slightly in 2008, with the firm managing modest growth in a punishing year. The New York-based firm brought in $1.23 billion, up 4.75 percent from 2007. Revenue per lawyer was down two percent, however, to just over $1 million.

How did Weil manage to raise PPP in this challenging market? More facts that should be obvious after the jump.

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(Or ‘D’uh: Weil Makes Money’)”

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Biglaw Reversed Perk Watch: No More Tech Stipend at Weil

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Weil.gifFor Biglaw technophiles, one of the nicest firm perks is the technology stipend: a couple of thousand dollars to lavish on a new shiny toy. With the BlackBerry Curve 8900 debuting to rave reviews, and rumors in the tech world of a new iPhone on the horizon, there are lots of toys to get worked up about these days.

Alas, associates at Weil, Gotshal & Manges will not be taking part in the tech spending frenzy. One associate reports that their stipend fell victim to economic pressures last week:

They eliminated our $2K tech stipend for first and second years ($4K for the first two years). It was a bit strange, though, because anyone who had used their $2K before today gets reimbursed. So if you bought a laptop yesterday, you get a laptop. Otherwise, no laptop for you!

Congratulations to all Weil associates who placed their laptop orders in the first two weeks of January.

Tech toys are not the only perk being reversed. The associate tells us that the partner mentoring budget was cut as well.

What’s the latest perk erosion at your firm? Feel free to discuss in the comments or to send us a tip.

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GM Hires Weil (and Ex-Weil Partner) for Possible Bankruptcy Case

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Weil.gifSo should Weil Gotshal associates be rooting against a government bailout of GM and the other big automakers?

GM bankruptcy –> more fees for Weil –> bigger bonuses (which WGM has not yet announced)?

UPDATE (1:00 AM): As of now, it looks like the auto industry bailout talks have failed. This makes a GM bankruptcy even more likely.

But even if GM does file for Chapter 11 (or even Chapter 7), thereby generating thousands of billable hours for Weil associates, it’s unlikely that Weil will pay out Skadden-sized bonuses (although the speculation sure is fun). As noted in the comments, Weil generally follows the market, and the market has settled around Cravath.

Paying above market could create problems for Weil. As one reader previously noted, “Weil will never be a bonus leader because there is concern at the firm that it would seem unsightly by the firm’s bankruptcy clients to lead the market with bonuses.”

That concern seems warranted. As GM director George Fisher told Bloomberg last week, “We are fearful, very fearful, of a prolonged [bankruptcy] proceeding that would just destroy our brand in the marketplace and therefore that is not considered a viable option…. These Wall Street geniuses and law firms are coming up with all these solutions that make them a lot of money.”

FURTHER UPDATE: As noted in the comments, as well as the original WSJ article, GM has also retained former Weil partner Martin Bienenstock, now at Dewey & LeBoeuf, to help it become a “futuristic” automaker for the 21st century. Good luck with that.

GM Hires Advisers to Weigh a Bankruptcy Filing [Wall Street Journal (subscription)]
GM Hires Lawyer Bienenstock to Reconfigure Automaker [Bloomberg]

Earlier: If the Big Three Fall, Which Law Firms Rise?
Jones Day’s Chrysler Bankruptcy Coup
Chrysler Hires Jones Day As Bankruptcy Counsel [Dealbreaker]

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If the Big Three Fall, Which Law Firms Rise?

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Gleaming tower of cars.JPGAre we going to have a domestic auto manufacturing industry in 2009? Nobody knows. But just in case the government doesn’t bail out Detroit, law firms are jockeying to work on the bankruptcy.

AmLaw Daily reports that three firms are the early favorites to capture the bankruptcy work: Weil, Gotshal & Manges, Kirkland & Ellis, and Skadden.

Timothy Pohl, part of Skadden’s ruling class, sounds confident that his firm is in the running:

Pohl says Skadden has historically done work for former Chrylser owner Daimler, which sold 80 percent of Chrysler to private equity firm Cerberus Capital Management in 2007 for $7.4 billion. Skadden also does work for Ford, says Pohl, adding that the firm has yet to be contacted by either automaker.

“I’m not convinced that any [of the Big Three] are hiring advisers yet,” Pohl says. “But between us, Kirkland, and Weil, I’d say that the three of us have the largest [bankruptcy and restructuring] groups with a big falloff after that.”

Obviously both Skadden and Kirkland have the chops to handle the work, but isn’t the real question “Why not Weil?”

It’s uncertain whether a potential Big Three bankruptcy might present a similar problem for Weil–and how the firm would manage to juggle its Lehman, Lenox, and other client obligations in the event of such a resource-draining retention. That’s especially true given that it’s unclear whether a potential Big Three filing would proceed on a liquidation track (a la Lehman) or as an infinitely more complicated corporate restructuring.

At some point, Weil has to run out of bankruptcy lawyers. Right?

On Kirkland, after the jump.

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Weil Gotshal Attorney Fees From Lehman Bankruptcy

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Weil.gifBloomberg News is reporting that the train wreck formerly known as Lehman Brothers filed an application to pay Weil Gotshal attorneys a whole boatload of cash:

The investment bank asked for court approval to pay $650 to $950 an hour for partners and counsel, $355 to $595 for associates and $155 to $295 for paraprofessionals.

A year ago, the WSJ Law Blog did a report on the Thousand-Dollar Bar. There were only six lawyers on that list. So while $950 an hour isn’t astronomical, it’s clear that Lehman is getting the most expensive bankruptcy money can buy.

At the upper end, $595 per associate hour is pretty good money as well.

Whenever we mention that Weil could be a bonus leader this season a smart commenter always disagrees:

Weil will never be a bonus leader because there is concern at the firm that it would seem unsightly by the firm’s bankruptcy clients to lead the market with bonuses

Good point. Still, there is a lot of money floating around Weil these days. Are you sure that they won’t trickle cash rewards down on associates?

We’ll wait and see.

Weil May Get $950 an Hour for Lehman Bankruptcy Work (Update1) [Bloomberg]

The Law Blog Thousand-Dollar Bar [WSJ Law Blog]

Earlier: Weil Gotshal Produces The Mother Of All “We’re Awesome” Emails

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Weil Gotshal Produces The Mother Of All “We’re Awesome” Emails

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Weil.gifWe’ve been covering law firms’ attempts to reassure associates in these troubled times. Because of their respected bankruptcy practice, we’ve assumed that all was well at Weil.

Friday we received word that Weil isn’t just doing “well.” Apparently, “global financial crisis” is how you spell “straight cash homey” at Weil Gotshal. From firm chairman Stephen J. Dannhauser:

To date, our representation of Lehman Brothers Holdings has engaged a large swathe of the firm, more than 100 attorneys and staff working on the many matters this bankruptcy, the largest in US history, has spawned. In addition to the large team providing bankruptcy counsel to Lehman, Weil Gotshal’s corporate team has already aided the company in the structuring and execution of the two largest transactions ever in a Chapter 11 proceeding. These include the sale of substantially all of Lehman’s US investment banking business, its headquarters, two support facilities, and the broker-dealer business (including the real estate and infrastructure necessary to preserve that business) to Barclays, as well as the sale of certain investment-management assets, including the Neuberger Berman division, to private-equity firms Bain Capital and Hellman & Friedman.

We’ve noticed a paucity of Weil associates participating in our comment threads, but clearly that is because they are all very busy reupholstering their seat cushions with dollar bills.

Are we sure Weil will just be a bonus “follower” this fall?

Read the full memo after the jump.

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