It had been rumored that the law firm of Dewey & LeBoeuf was struggling through some difficult times recently, with potential layoffs, departures of partners and even financial problems. All of the rumors can to a head on Friday when the chairman of the firm, Steven H. Davis, sent a memo to its employees that said layoffs would be coming along with other methods to cut costs.
According to Above the Law, the start of the memo reads as follows:
“Dewey & LeBoeuf has, in the last couple of days, been the subject of press stories on U.S. legal blogs. These have focused on rumors regarding the firm’s financial performance, recent partner departures, and certain cost-reduction measures being implemented by the firm. We had planned to communicate these measures to the firm when we knew exactly how they would impact individual offices and departments, but given the recent press attention, I would like to explain the reasons behind the firm’s current actions.”
The main section of the memo reads as follows:
“The firm enjoyed many successes last year and saw improved financial performance, with an increase in revenues in 2011. In addition, we have achieved significantly higher revenues so far this year than in January/February 2011. At the same time, however, we, like some other firms, have also experienced a significant increase in our cost base.
Notwithstanding our results in 2011 and so far this year, the firm’s Executive Committee has decided to take proactive steps to align the firm’s resources with anticipated demand and strengthen the firm’s competitiveness in the global marketplace. Some recent partner departures have been consistent with the firm’s strategic planning for 2012, and we expect some additional partners to leave. In addition, we are reducing the number of lawyers and administrative staff globally by approximately 5% and 6% respectively. While decisions of this nature are necessary to ensure the firm’s competitiveness, they are always difficult and we very much regret the impact they have on our colleagues who are affected.”
The layoffs mentioned by Davis could cost close to 60 attorneys their jobs within a firm that employs around 1,100 attorneys across the globe. Almost six associates in the offices of D.C., New York and Los Angeles have voluntarily left the firm for Sidley Austin as well. Legal sources from the industry also claim that lawyers from Dewey & LeBoeuf have been contacted by legal headhunters.
The majority of the attorneys affected by the layoffs have already been told that their services will no longer be needed within the firm, with most of the attorneys expected to be finished work at the end of March.