The signals seem mixed in terms of whether the legal profession is on the road to recovery. On the one hand, the pace of layoffs is certainly slowing. On the other hand, firms are taking other steps to keep headcount (and expenses) down. They are not yet in a mode where they need more hands on deck to handle all the work.

One of the popular approaches is deferral extension, i.e., pushing start dates for incoming associates back yet again. A number of firms have gone down this path. To view our prior coverage, click here and scroll down.

The latest firm to take this approach: Winston & Strawn. The firm’s incoming associates were previously scheduled to arrive on January 19, 2010. Now, according to a memo issued yesterday by hiring partner Joseph Torres, class of 2009 associates will be starting on one of three dates: February 1, 2010; June 1, 2010; or October 4, 2010.

Deferral extension details, including the full memo, plus other information about Winston — after the jump.

In our last post about Winston & Strawn, we covered an “all associates” meeting at which the firm admitted conducting layoffs, but refused to divulge information about their scope. The firm said something along these lines: “Out of respect for the individuals involved, we won’t publicly disclose either future layoffs or past layoff numbers.”

Several commenters questioned that rationale. See, e.g., here:

WTF does that mean?! Are they dead [so] that W&S doesn’t want to speak (ill) of them?

I think I’ll try injecting that into my daily life. “Out of respect for the individuals involved, I won’t publicly disclose either future sexual affairs or past mistress numbers.” I like that… think it’ll work?

Commenters also requested estimates of the size of Winston’s layoffs.

We don’t have hard data ourselves. But we estimate — conservatively, we think — that Winston & Strawn has laid off at least 15 percent of its lawyers in 2009 to date.

So, how did we reach this number?

It’s time for a quick follow-up on yesterday’s “all associates” meeting at Winston & Strawn. Alas, it was a bit anticlimactic. “Just a way for the firm to ruin everyone’s weekend,” quipped a tipster.

According to our sources at the firm, this is what associates were told:

1. Compensation at Winston will remain competitive; no salary cut will be imposed at this time. (The firm froze salaries earlier this year.)

2. Layoffs were necessary, and they have been conducted, but hopefully they’re a thing in the past (although nothing is guaranteed on this score).

So, exactly how many people have been laid off by Winston?

On Monday there will be an “all associates” meeting at Winston & Strawn.

Any guesses as to what it might be about? Bonuses for this year? A move away from lockstep? Candid acknowledgement of recent stealth layoffs? Feel free to offer us your guesses, by email or in the comments.

UPDATE (10/12/09): We are gathering reports and will post about the meeting later (probably tomorrow morning). Based on preliminary reports, it was not a particularly exciting meeting, basically along the lines of a “state of the firm” talk.

If you would like to contribute information, please email us: tips at abovethelaw dot com (subject line: “Winston and Strawn”). Thanks.

Full memo after the jump.

Ed. note: Above the Law has teamed up with Law Shucks. Law Shucks has done excellent work translating all of the layoff news into user-friendly charts and graphs: the Layoff Tracker.

We’ll actually be hitting a week and a half in this roundup, going back to August 1. As we’ve been saying for a while, September is not likely to be as tranquil as August was (3 layoffs, 126 people in total), and the layoffs have already started. Eleven days in, and twice as many firms have laid off almost twice as many people.

Let’s step back and start with the big picture.

The really bad news came just before the Labor Day weekend, as unemployment hit 9.7%, a 26-year high. If you really want to find a silver lining, the net job loss for August was less horrible than expected, coming in at 216,000 jobs lost for the month. The decrease in total unemployment in July is now just a blip on a 16 out of 17 month streak of worsening employment numbers. It’s not even like the improvement in July was a result of actual new jobs, either — it came from people becoming so disaffected that they stop looking for jobs entirely, which takes them off the rolls of the unemployed. Hurray for government math!

Coincidentally, BLS reported 100 jobs lost in the legal sector for the month, which is right in line with the tracker (although they’re measuring two entirely different things).

Overall, 6.9 million jobs have been lost since the beginning of 2008 — which, coincidentally, is also the beginning of the Law Shucks layoff tracker (we count from Cadwalader’s first round). Major firms account for just over 13,000 of those.

So what has been going on so far this month? After the jump, we analyze the looming surge.

We received a lot of tips about Winston & Strawn during the month of August. It seems like the firm had a busy month. We’ve reached out to the firm — multiple times — but haven’t heard anything back. But multiple sources report that Winston laid off around 20 associates over the month of August.

It is not surprising that the firm did not respond to us. Tipsters report that Winston has been extremely stealthy about its associate cuts. They laid people off over a long period of time, but never more than a few associates at any one time. One tipster explains it this way:

The layoffs for attorneys started in the Spring and they took breaks from it to keep under the radar. Same with the secretaries.

As we understand it, the associates let go were mid-level attorneys. They were told that the layoffs were for economic reasons.

Associates at Winston weren’t the only ones feeling the pain of being let go. After the jump, tipsters report that partners have been shown the door as well.

As we roll through the next segment of the 2010 Vault rankings, we get into some firms that have been caught testing the stealth layoff waters. To refresh your memory, here is the next list of firms:

31. Milbank Tweed Hadley & McCloy
32. Paul Hastings Janofsky & Walker
33. Akin Gump Strauss Hauer & Feld
34. Fried Frank Harris Shriver & Jacobson
35. Winston & Strawn
36. Allen & Overy
37. Willkie Farr & Gallagher
38. Freshfields Bruckhaus Deringer
39. Baker Botts
40. Munger Tolles & Olson

Check out the big move by Munger. It’s up 11 spots on this year’s list. And let’s not forget about the firm’s #1 A-List ranking by Am Law earlier this year. Munger’s managed to do all of this without laying off a massive number of associates. Hopefully other Biglaw firms (and current 2Ls) will take note.

We know people have strong opinions about some of the firms on this list. Let’s get into them after the jump.

Last summer, Winston & Strawn only had a 90% offer rate for summer associates. Last year, that was worrisome. This year, summers would likely injure baby seals for a 90% offer rate.

Summers are getting nervous, and it appears that a video conference from Winston’s managing partner, Tom Fitzgerald, didn’t help matters. Here is one tipster’s report of the proceedings:

The entire Winston summer class watched a video-conference speech given by Tom Fitzgerald. Fitzgerald explained that we would be notified of offers during Labor Day weekend. We were also told that the demand for legal services has plummeted, and that we were very talented and would do well no matter whatever field or firm we joined. He even talked about some past Winston summers who went on to do great things … Overall Tom seemed to be preparing us for a slaughter come September. He also mentioned at the end of his address that those who did get offers would start January 2011 at the earliest. Needless to say the summers were feeling pretty s****y.

We haven’t been able to confirm that Winston & Strawn will be instituting a mandatory deferral for summers that receive an offer to return full-time.

Of course, it’s not all bad news for the firm. Just last week, Winston hired Thomas Cottingham III and a number of other attorneys from Hunton & Williams. The move should bolster Winston’s Charlotte office — good news for the firm, as well as the city of Charlotte.

But expanding during a recession is always a difficult thing to do. After the jump, take a look at one attorney’s thoughts about how Winston’s expansion in China is going — thoughts apparently intended for the firm’s former and current chairmen, but accidentally disseminated firm-wide.

UPDATE AFTER THE JUMP (1:00 P.M.): One Winston tipster says the “attorney” weighing in on the Chinese expansion is just a spammer.

More firms are pushing back the start dates of incoming first year associates. This weekend, we learned that Winston & Strawn has pushed back start dates to January 19th, 2010. Deferred associates will receive an additional $15,000 on top of their $10,000 bar stipend. The firm is also picking up health care for its incoming associates, starting in September.

We learned today that Baker & McKenzie has also pushed back start dates to January 2010. As we understand it, the firm is not offering any additional stipend other than what they normally pay out for bar expenses.

WilmerHale also announced a start date push back. According to a firm-wide memo:

As is our normal practice, we will have more than one start date. A portion of the class will start on January 20 and the remainder will start on March 17. To determine the group that will start on each date, Legal Personnel and Recruiting will work with department and practice group leaders to balance the stated interests of the incoming associates with the various needs of departments, practice groups and offices.

Those starting in January 2010 will receive a $10,000 deferral stipend on top of a $5,000 bar stipend, while the March 2010 first years will receive a $15,000 bar stipend.

But WilmerHale is also encouraging associates to take a full year off:

We also informed our incoming associates that they may defer their start dates until the fall of 2010 for a stipend in the amount of $75,000. This deferral is entirely at the option of the individual incoming associate and is not tied to his or her ability to obtain a pro bono or other public service position.

The WilmerHale deferral stipend is right at the top of the Latham-led market for these optional year-long programs. But its stipend for people being forced to start in January or March is a little on the low end.

Baker, Winston, and WilmerHale are announcing their programs late in the game. We’ll have to see if the delay puts incoming associates heading to the these firms at a disadvantage in terms of post-bar exam options.

After the jump, we check in on Sonnenschein’s late breaking, long-term deferral.

Another top firm has frozen its 2009 salaries. Winston & Strawn informed associates last week that 2009 salaries will be held at 2008 levels.

It’s what we like to call around here a “Slurpee freeze,” as the firm might change its mind should our national economy pull out of its long and continuous nose dive. The freeze announcement memo, available in full after the jump, says Winston will “continue to monitor economic conditions in the coming months and will revisit this issue if and when it becomes appropriate.”

ATL will post naked photos of all of its contributors if and when it becomes appropriate, too. Of course, “if and when” is our way of saying never.

Reactions from Winston’s associates to the freeze and to bonuses outside of New York:

I’m not sure why I’m surprised given how cheap the firm usually is but we just got hit with a full year freeze (with the usual boilerplate caveat language) and much lowered bonuses (lower than half-Skadden for most of the tiers). I wish I could say I’m going to start looking. Instead, I suppose I should just be happy I have a job.

---

A Jenner-style half-raise would have been nice.

---

[I]t seems that for non-NY offices, they significantly reduced bonuses. Bonuses were about 50-60% of last year’s, even for top billers. Mine was the same as it was THREE years ago.

Winston’s memo after the jump, as well as an updated list of the 37 firms (that we know of) that have instituted a salary freeze for 2009. If you know of others, send us an e-mail at tips@abovethelaw.com.

It’s a little bit late in the bonus season, but there are still firms trickling in with bonus news.

It’s not terribly surprising bonus news. Winston & Strawn has matched the Cravath scale:

I am pleased to announce on behalf of the Firm the amounts of year-end bonuses for eligible New York associates for fiscal 2009, as follows:

Class of 2008 (1st Year) $17,500 (pro-rated)
Class of 2007 (2nd Year) $17,500
Class of 2006 (3rd Year) $20,000
Class of 2005 (4th Year) $22,500
Class of 2004 (5th Year) $25,000
Class of 2003 (6th Year) $27,500
Class of 2002 (7th Year) $30,000
Class of 2001 (8th Year)
$32,500

There’s a 1900 hour billiable requirement.

Wonder if Obama will get pissed about that? Congratulations to Winston associates on your belated windfall.

Read the full Winston memo after the jump.

Some have wondered: Where was star litigator Dan Webb at Governor Rod Blagojevich’s bond hearing?

High-powered Winston & Strawn litigators Dan Webb and Bradley Lerman were not at Illinois Gov. Rod Blagojevich’s side when he appeared at a bond hearing on Tuesday. Blagojevich instead tapped Sheldon Sorosky, a lawyer from two-partner Chicago litigation shop Kaplan & Sorosky. Whither Winston & Strawn?

Here’s a possible answer, from the Wall Street Journal (subscription):

Illinois Gov. Rod Blagojevich owes more than $500,000 in unpaid bills to the law firm Winston & Strawn, his primary counsel since federal investigators began looking into various allegations of corruption five years ago. It is unclear whether the legal bills are for personal or campaign work, or for both. Campaign filings show Winston & Strawn had charged the governor’s campaign fund, Friends of Blagojevich, nearly $2 million in legal fees through the end of 2007.

“Friends of Blagojevich”: probably in short supply right now.

Update: As noted in the comments, if Winston & Strawn isn’t eager to rep Rod, it’s understandable. Recall how the firm blew $20 million defending Illinois’s last corrupt governor, George Ryan. It lost the trial, lost the appeal, and couldn’t even get pro bono credit for the thousands of hours spent on the case.

Blagojevich Has $500,000 in Unpaid Legal Bills [Wall Street Journal (subscription)]
Webb-less in Chicago: Where Was the Star Litigator At Blago’s Bond Hearing? [Am Law Daily]

Winston & Strawn is expanding with the help of Heller refugees. A tipster reports on the latest internal Winston communication:

[We] are extremely pleased to announce that the firm has added a number of former Heller Ehrman attorneys who will greatly enhance Winston’s practices and international presence. Winston has acquired three partners in Hong Kong from Heller and Heller’s international trade group in D.C. In addition, we welcome Joe Armao, a well-known environmental litigator, as a partner in our San Francisco office.

In Hong Kong, we are joined by capital markets and M&A partners Simon Luk and Michael Phillips and commercial litigation partner David Hall-Jones. Subject to local regulations*, these partners will be supported by additional associates and other professionals. Winston is also pursuing and fully expects to expand its presence in Asia with one or more offices in mainland China, likely to be in Shanghai and Beijing. We have begun the application process for this expansion. More details will follow as they become available.

In Washington, we have added four high-profile international trade partners: William Barringer, Daniel Porter, Christopher Dunn and James Durling, as well as associates Valerie Ellis, Matthew McCullough, Yu Li, and Ross Bidlingmaier. The international trade group will be supported by a number of non-lawyer trade professionals on the ground in Beijing.

Core practices primarily affected include complex commercial litigation, international arbitration and cross border deal-making capabilities. The firm has expanded materially in 2008 with the opening of the Charlotte office in January, the addition of prominent lateral attorneys to our existing offices and practices throughout the year, and this most recent expansion to Asia.

A press release will be available tomorrow morning on winston.com. An office page for our new Hong Kong location will be posted as well and will include address information and profiles of our new group.

We expect to take over existing Heller office space only as necessary. A full integration effort is underway; please take a moment to welcome our new team.

Regular readers of ATL will not be surprised by Winston capturing some top Heller talent.

Recent history after the jump.

If any Heller Ehrman attorneys were hoping that a major firm would sweep in and hire a whole bunch of Hellerites, the Dissolution Committee is warning you not to hold your breath. The Recorder reports:

On Tuesday, Peter Benvenutti, the chairman of the dissolution committee now controlling the firm, confirmed whispers that Baker & McKenzie and Winston & Strawn, both one-time merger candidates, had withdrawn proposals to pick up large groups of lawyers and their expensive real estate. While Benvenutti would not say whether deals on this scale are being discussed with any other firms, he did say there’s interest in taking over certain of the firm’s leases, and “we expect to have clarity in a day or two.”

At this point, why would Baker or Winston Strawn take on expensive lawyers when they can just sit back and cherry pick the superstars they want? We haven’t heard any story of a Heller rainmaker saying “If I come, these 30 people are coming with me.”

More bad news after the jump.

As we mentioned earlier today, we’re doing a series of posts on law firms no-offering their summer associates. Recently we heard this, from an operative in a law school career services office:

The first blow of what we expect to be a horrible recruiting season has landed. Winston & Strawn in Chicago was “oversubscribed” and is handing out no-offers and soft offers.

We contacted the firm for comment. From spokesperson Darryl Van Duch:

I am responding on behalf of firm management regarding your inquiry about Winston’s summer class. In your email you stated that Winston & Strawn in Chicago is oversubscribed, and is handing out no-offers and cold offers.

It is the firm’s policy to not comment on individual personnel issues or hiring issues. However, we felt in this situation it was appropriate to address your statements. As to the issue of cold offers, we have not made and will not make so-called ‘cold’ offers. Additionally, the overall percentage rate of offers we made to summer associates in the firm this year was in the 90s, consistent with prior years.

What we’ve been hearing is roughly consistent with Van Duch’s statement. Tipsters tell us that the firm’s Chicago office no-offered 7 out of 67 summer associates, meaning that 90 percent of summers did receive offers.

Now, 90 percent seems plenty high. But it’s certainly lower than the 95 to 100 percent offer rates that were par for the Biglaw course during recent boom times. According to the NALP directory, the Chicago office of Winston had an offer rate of 100 percent in 2007, with 37 out of 37 summers getting offers.

More ruminations on offer rates, after the jump.

Welcome to another post in the 2009 Vault 100 open thread series. You all seem to like having the law firms listed in groups of ten, so we’ll keep it up. Here are the thirty-something firms from the Vault 100, with prestige scores in parentheses:

31. Fried, Frank, Harris, Shriver & Jacobson LLP (6.461)
32. Freshfields Bruckhaus Deringer LLP (6.327)
33. Akin Gump Strauss Hauer & Feld LLP (6.313)
34. Winston & Strawn LLP (6.275)
35. Quinn Emanuel Urquhart Oliver & Hedges LLP (6.235)
36. Willkie Farr & Gallagher LLP (6.174)
37. Orrick, Herrington & Sutcliffe (6.173)
38. Allen & Overy LLP (6.147)
39. Cadwalader, Wickersham & Taft (6.131)
40. Proskauer Rose LLP (6.102)

Fried Frank and Cadwalader have been on the ATL radar of late. We broke news of staff layoffs at Fried Frank earlier this week, and news of the attorney bloodletting at Cadwalader last month. As noted in Cadwalader’s notable perks: “ouch, layoffs.” (Speaking of, in going through the Vault 100 list, we’ve discovered that Vault’s definition of “perk” is very different from ours.)

In the comments, the curious can pose questions, and the insiders can share insights. More threads to come.

Earlier: Vault 100 Open Threads - 2009

Two pieces of good news from Winston & Strawn. First, like many other leading law firms, they’ve raised their maternity leave to 18 weeks (from 12 weeks). To see where your firm stands, check out our maternity leave table, continuously updated by surveys guru Justin Bernold.

Second, for all of you iPhone-atics out there:

You guys might be interested in this little tidbit. Beginning August 1st (provided there are no issues with compatibility or supply), Winston & Strawn will include the iPhone as part of its supported mobile devices. Last summer, Winston announced it would start purchasing BlackBerry devices for attorneys on a 2 year replacement cycle (prior to that time, attorneys were required to purchase their own devices but the firm reimbursed for data charges).

As noted in the announcement below, the Apple iPhone will now be among the supported devices, and the firm is even willing to purchase it for eligible attorneys (i.e., if you are not subject to a 2 year contract). For those attorneys who want the 16GB model, the firm will pay the first $200 (representing the cost for the 8GB model) and charge back the $100 additional cost to the attorney’s personal account.

Check out the full announcement — plus a handy chart comparing the iPhone with the Blackberry 8100, Blackberry 8800, and Blackberry 8830 — after the jump.

There are vague rumors of something afoot at Heller Ehrman. Could the persistent gossip about a merger finally come true? Last week brought this report from TheLawyer.com:

The chairman of US firm Heller Ehrman has refused to rule out a merger after respected litigator Paul Alexander became the seventeenth partner to leave the firm this year. The firm lost 25 partners in 2007 and has lost 17 this year after Alexander quit to join Howrey in Palo Alto. [Ed. note: See links collected at the end of this post for more coverage of partner departures.]

Heller chairman Matt Larrabee told The Lawyer that a merger was one of the options his firm was considering, but maintained that no decision had been taken at this point in time….

The rumour mill has put Heller in talks with a number of firms and Larrabee’s refusal to deny that Heller is currently in merger talks will only add to the widely held belief that the firm is nearing a deal.

But it won’t be the previously rumored merger with Winston & Strawn, which Heller sources tell us is history. Another possible suitor: Proskauer Rose, which emerged in speculation last month. One Heller tipster likes the idea, noting good geographical fit — Heller’s California and Asia presences nicely complement Proskauer’s East Coast focus — and practice group compatibility (“e.g., pro-policy holder insurance coverage, similar patent practices”).

Heller chairman Larrabee told the Lawyer: “I can categorically deny that Heller has concluded we must merge.” But internally the message is a bit different. Associates were told in a recent video conference that “the firm is definitely looking to merge, that it is an ‘awkward’ size for the market.”

In the meantime, Heller Ehrman continues to go about its business, including major pro bono matters. For example, working together with the Public Interest Law Project and Bay Area Legal Aid, the firm just filed a lawsuit against Alameda County, challenging the planned termination of general assistance benefits to thousands of indigent individuals. More details here.

Heller chairman coy over merger rumours [The Lawyer]
The bigger the better [The Lawyer]
Culture Wars Take Their Toll on Heller Ehrman [American Lawyer]
Morning Wrap: Partner Defections [The BLT / Blog of the Legal Times]
Heller’s Tempestuous San Diego Office Loses 4 [Legal Pad / Cal Law]

If Winston & Strawn ends up merging with Heller Ehrman (or any other firm), here’s a question to consider: Whose instant-messaging policy will prevail? A tipster tells us:

“Winston has blocked Meebo, Gchat, and all other possible chat clients.”

We checked with sources at Winston, who report that this policy is nothing new. Instant messenger programs have been blocked at Winston for quite some time (at least several months).

But we still found the policy interesting, especially in light of recent blogosphere discussion of website blocking. It got us wondering: What other law firms prevent their employees from using instant messaging?

Instant messaging can be a huge time suck. Workplaces that ban IM’ing, at least between their employees and outsiders [FN1], are probably more productive. Most people would rather IM with a law school classmate about the evilness of Katherine Mayfair on Desperate Housewives than plow through a stack of sale/leaseback agreements.

But a ban on instant messaging — especially if accompanied by other measures, like preventing people from accessing non-work email accounts from the office (hello, Goldman Sachs) — could lower employee morale. We’re reminded of how Allen & Overy faced a mini-revolt after banning Facebook in its London office (a policy it quickly reversed).

ATL readers: Any thoughts? Does your firm prevent you from using an instant-message client? If so, does it tick you off? If not, do you wish it did, à la Odysseus wanting to be tied to the mast?

[FN1] We’re not counting the internal IM systems that some firms — e.g., Kirkland & Ellis (if memory serves) — have in place. These networks probably still transmit a lot of gossip, of the “omg have you seen the new para’s outfit” variety. But when you’re limited to IM’ing with your co-workers, a lot of your talk will be about…. work.

Here’s an update to yesterday’s post about rumors of possible merger talks between Heller Ehrman and Winston & Strawn. Remember, of course, that these are just rumors — nothing more. Neither firm has offered any substantive comment. So please don’t get too excited.

First, as reported by Legal Pad, the domain names of WinstonHeller.com and HellerWinston.com — previously snapped up by an anonymous buyer — are available once again. Legal Pad speculates:

Does the unURLing mean any merger is off? Dunno. If we were going to engage in unfounded speculation (one of the main reasons the Internet gods created blogs), we’d say low-grade talks had occurred, so someone grabbed the URLs, then decided to un-grab ‘em just to quiet all the, um, unfounded speculation. Working great so far!

Second, just this afternoon, the following email from Winston’s managing partner, Tom Fitzgerald, went around the firm:

From: Thompson, Nadja On Behalf Of Thomas Fitzgerald
Sent: Wednesday, April 23, 2008 1:49 PM
To: All Business FIRM
Subject:

This morning you may have noticed on the W&S Update an article published referencing the purchase of the domain names “WinstonHeller.com” and “HellerWinston.com,” along with rumors of a potential merger between the two firms. W&S Update is an online service that reports all articles about W&S, regardless of content or veracity.

We feel it is important to notify our employees and attorneys that the firm did not secure, nor was it involved in securing, any domain names, including those referenced in the article. We are constantly contacted by other law firms, attorneys, and professional search firms to look at business opportunities which we explore as appropriate. As a matter of policy the firm does not acknowledge or otherwise comment on rumors regarding internal firm business or its clients.

Our tipster’s take: “[A] rather shady explanation. They don’t address the substance of the rumors, just that they didn’t secure the domain names.”

Right now we have nothing more than rumors. When we have something more substantive to report, we’ll let you know.

Who Dumped WinstonHeller.com … and Why? [Legal Pad / Cal Law]

Earlier: Law Firm Merger Mania: Winston and Heller, Sitting in a Tree? M-e-r-g-i-n-g?