JD Journal » UPDATE

Morning Roundup

joshua — Mon, 09 Nov 2009 17:32:47 +0000

Good Morning everyone! I hope everyone had a terriffic weekend. Here’s a look back at Friday’s news (and a small weekend update) to get your week started.

A judge has vacated the $1.2 billion default judgementagainst PepsiCo…

Cleary Gottlieb announced its year end bonuses…

Greenberg Traurig added five attorneysfrom Ballard Spahr…

and Latham & Watkins promoted 23 to partner…

Over the weekend we got an anonymous tip that in addition to letting go of 21 second year associates, Goodwin Procter also laid off around 30 staffers, including secretaries who had been there for over 20 years.

Troutman Sanders Cuts Associate Payroll 10% [Update 2]

Erik Even — Thu, 30 Jul 2009 20:01:22 +0000

Atlanta’s Troutman Sanders has announced to its associates a 10% cut in total associate payroll budgeted for August to December of this year.

The salary cuts for each associate will be performance-based. There are no further details available at this time.

If you know anything about the salary cuts at Troutman Sanders, please — send us a confidential tip!

Headquartered in Atlanta, Georgia, Troutman Sanders has offices in Chicago, Hong Kong, London, New York, Newark, Norfolk, Orange County, Raleigh, Richmond, San Diego, Shanghai, Tyson’s Corner, Virginia Beach and Washington, DC.

UPDATE

A JDJournal tipster tells us (edited for length and clarity):

The Troutman pay cuts are effectively retroactive to January 1, 2009 (e.g., they’re showing each associate his or her annual salary change, but taking the entire annual decrease out of the associate’s remaining 2009 pay checks).

Most cuts thus far have not been retroactive in this way, right? I’d think it to be a little late in the year for a retroactive reduction.

This is the first we have heard of retroactive salary reductions. And yes, it is a bit late in the year.

UPDATE 2

Troutman says the pay cuts are not retroactive, and apply only to compensation after August 1st. But it appears that a number of associates in the firm believed as our tipster did, that the cuts affected salary for the whole year.

Tipster: More Layoffs on Horizon at Schwabe, Williamson & Wyatt [Update 3]

Erik Even — Sat, 25 Jul 2009 16:00:48 +0000

In June we reported that Portland, Oregon’s Schwabe, Williamson & Wyatt would cut associate salaries and lay off support staff.

Now a JDJournal tipster informs us that more layoffs are coming in August, and the new round will likely include associates.

The tipster says (edited for length and clarity):

Hopefully, Schwabe will handle this round of layoffs better than the June 15 layoffs of nearly 10% of its secretarial and professional staff, in which management attempted such a stealthy layoff that they did not even bother to tell the attorneys that their secretaries would be eliminated – many attorneys came back from a CLE event, a meeting, or a vacation and discovered their secretaries were simply gone.

It would be pretty interesting if management attempted to conduct any associate layoffs in this manner, and just left it up to the supervising partners to figure out who was still around to work on their cases.

Much of the staff affected by the June 15th layoff has been seriously questioning the timing of it – while Schwabe is still insisting that these staff members were cut due to the current state of the economy, Schwabe went on to hire two full-time secretaries within a week of cutting nearly 10% of its secretarial staff… None of the laid-off secretarial staff were asked to return to fill either one of these positions.

…it is worth mentioning that nearly all of the secretarial staff laid off on June 15th had raised some complaint to their supervisor, Virginia Zingg, in the seven months preceding the layoffs, leaving most of the secretarial staff who lost their jobs on June 15th to reach the conclusion that Ms. Zingg simply used the layoffs as a convenient way to clean house for those staff members who she apparently perceived as troublemakers.

If you know anything about layoffs at Schwabe, please — send us a confidential tip! And thanks to all our tipsters!

Schwabe, Williamson & Wyatt is a law firm with over 160 attorneys in seven cities. The firm currently has offices in Portland, Bend and Salem, Oregon; Seattle, Vancouver and Stevenson, Washington; and Washington, DC. It is the seventh largest law firm in the Pacific Northwest, and the second largest in Oregon.

UPDATE

Another tipster has a lot to say. Edited for length and clarity:

Viginia Zingg did use the layoffs as an excuse to clean house of those she didn’t like… She breaches confidentiality between the secretaries and staff behind her closed doors, and starts rumors just to get someone to give up information.

There has been no support to the secretarial staff since the layoffs took place, and the associates and summers are doing yet another rafting trip to the Deschutes this weekend, like last weekend wasn’t enough!

The staff get to go pull weeds out of Washington Park and have a picnic at the Zoo afterwards as their reward this summer. I bet we will see an article about how great of community services the firm provides after the staff go sweat all day pulling the weeds at their summer event, which used to take place on the Portland Spirit. I guess those days are over…

…the morale at Schwabe is null/void. It is beyond low if that is possible – non-existent.

UPDATE 2

Another tipster writes in (edited for length and clarity):

…one of the managing partners went before the entire firm to announce that every level of Schwabe would be making sacrifices in these difficult times; staff suffered layoffs, associates received pay cuts, and the partners would not be receiving their “holdbacks.” (The partners have a percentage of their salary held back each month. and then receive those funds in June and December pending good receivables).

Within two weeks after that announcement, the partners did in fact receive their holdbacks. Also, note that mid-level management was not mentioned with regard to any sort of sacrifice — no layoffs, no pay cuts.

There have been complaints brought to upper management for years with regard to Virginia Zingg’s inability to maintain confidentiality. It has been a wonder to staff how she maintains her position as a mid-level manager, and further why Schwabe’s upper management and board would allow her to make the decision with regard to which individuals would be laid off.

UPDATE 3

Disturbing reports are emerging from several staff members at Schwabe Williamson & Wyatt that Virginia Zingg allegedly commented to them, “Now that so many staff have been eliminated, there will be bigger bonuses for all of us at the end of the year.” In light of the recent reports that the partners did, in fact, receive their holdbacks, it is becoming increasingly clear that the June staff lay-offs, the attorney pay cuts, and the future lay-offs planned for August are not due to the current financial forecast.

Rather, according to Ms. Zingg – a member of management, who would be privy to knowing such things – it was all so that there would be bigger bonuses for all employees at year’s end.

In fact, if Schwabe were legitimately concerned about remaining economically viable, they would terminate Ms. Zingg because she is a huge liability – upper management already has substantiated evidence that she has violated employees’ protected health information under the HIPAA Regulations, and it is just a matter of time before one of these employees obtains a judgment against Schwabe big enough to shut the whole place down.

Another Black Day: DLA Piper Lays Off 120 [Update]

Erik Even — Wed, 08 Jul 2009 17:00:55 +0000

Blawgs are reporting this morning that DLA Piper is laying off 20 lawyers and 100 staff today.

The layoffs are targeting the firm’s offices in Chicago and New York.

So far this year, the firm cut 22 in the Middle East; cut 37 trainees; laid off 12 lawyers in Oceania; let go 24 lawyers and 100 support staff in the UK; cut 80 associates and 100 staff across the firm; and laid off 20 lawyers and 34 staff in Asia.

DLA Piper is one of the largest law firms in the world. It is a legal services organization whose members and affiliates are separate and distinct legal entities. The organization boasts more than 3,500 lawyers in 29 countries and 65 office.

UPDATE

DLA Piper has now officially confirmed it laid off 21 lawyers and 100 staff today.

University of Illinois Law “Jobs-for-Entry” Scheme Revealed [Update]

Erik Even — Tue, 07 Jul 2009 16:08:49 +0000

The Chicago Tribune has uncovered a “jobs-for-entry” scandal at the University of Illinois College of Law, in which the law school admitted politically-connected applicants, some unqualified, in exchange for guarantees of jobs for law graduates.

In one example, recorded in emails obtained by the paper, University of Illinois Chancellor Richard Herman coerced the law school in accepting an unqualified applicant backed by then-Governor Rod Blagojevich. The governor’s representative promised Herman that in exchange, five law school graduates would get jobs.

In other emails, Law School Dean Heidi Hurd insisted that the law firms hire the graduates regardless of academic performance.

Governor Pat Quinn has called for a state commission to investigate the University of Illinois admissions process, after the Chicago Tribune reported that more than 800 undergraduate applicants in the last five years received special consideration because they were backed by University trustees and legislators.

The University of Illinois College of Law is the law school of the University of Illinois at Urbana-Champaign, the flagship campus of the public University of Illinois university system. The College is located in Champaign, Illinois. It is ranked 23rd in the nation for 2009 by US News & World Report.

UPDATE

Law School Dean Heidi Hurd issued this statement:

Contrary to recent headlines, the [University of Illinois] College of Law did not seek or receive any jobs from anyone in exchange for the admission of students. It did not enter into a “jobs-for-entry scheme” or engage in quid-pro-quo exchanges of admissions favors for employment favors. Indeed, it takes very little to make clear that the employment challenges of students who are not academically successful could never be overcome by anyone’s promises to furnish the College with job opportunities, as the recently published exchanges should have made clear. While my sarcasm was clearly lost on the tin ears of some, my e-mail exchanges in response to queries about this were on their face facetious.

Also, a group of UI law professors has published a nine page letter disputing the charges.

Dykema Cuts 17 Attorneys, 30 Staff [Correction]

Erik Even — Wed, 24 Jun 2009 17:01:29 +0000

This week, big law firm layoffs are back. Dykema, which according to a JDJournal tipster has laid off at least 20 lawyers and 30 staff since November, this month let go 17 attorneys and 30 staff, in what appears to be a separate round of cuts., has confirmed that 17 attorneys and 30 staff have been let go since November 2008.

Severance packages were offered. The layoffs were blamed on the economy.

Dykema Gossett PLLC is a law firm headquartered in Detroit, Michigan. Founded in 1926, the firm has offices across the United States, including Chicago, Dallas, Los Angeles, and Washington, DC. It currently employs over 450 lawyers and lobbying professionals. With the 2008 acquisition of 53 lawyers from the now-defunct Schwartz Cooper, Dykema’s largest office is now in Chicago.

UPDATE

The following statement is from firm chairman Rex Schlaybaugh:

Given the current market conditions, which have affected virtually every industry across the nation, we made the difficult decision to reduce our lawyer ranks by 17 and our staff population by 30 nationally. The firm has provided those who are leaving with severance benefits during this difficult time. This reduction is based on the economic climate. Dykema has a strong and conservative balance sheet, but it is essential that we protect and maintain that strength. The firms that are most effectively managed during tough times will not only survive but will emerge stronger.

Pillsbury Cuts Associate Pay [Update]

Erik Even — Fri, 12 Jun 2009 16:40:45 +0000

Pillsbury, which offered associates $60,000 to leave the firm, is imposing associate salary reductions based on hours.

Salaries are being cut between 10% 5% and 20%, depending on how many hours the associate has worked this year (January through May).

Those who worked the highest number of hours may not see a salary cut.

Pillsbury Winthrop Shaw Pittman LLP is an international law firm with offices located throughout the US and globally, including key financial centers New York, London, Tokyo and Shanghai.

UPDATE

Further details have emerged. Pillsbury’s hours target is 1,950. A 90% utilization rate will get you a 5% pay cut. A 75% rate gets the 20% cut. Some training and pro bono hours will be counted.

The firm is currently considering its compensation program for 2010; the implication is that the curretn cuts will be temporary.

K&L Gates Opens Dubai Office [UPDATE]

Erik Even — Wed, 03 Jun 2009 17:00:36 +0000

Pittsburgh’s K&L Gates, which in March opened a Singapore office, has launched a footprint in Dubai, UAE.

It’s the firm’s first office in the Middle East, and its 33rd overall.

K&L Gates LLP employs over 1900 attorneys worldwide, and is ranked as the 7th largest law firm in the world. It was formed in January 2007, by the merger of Pittsburgh-based Kirkpatrick & Lockhart Nicholson Graham with Seattle-based Preston Gates & Ellis, co-founded by William H. Gates, Sr.

UPDATE

K&L Gates has hired Paul de Cordova away from Ashurst, where he managed the firm’s Dubai office. The firm will also move senior dispute resolution partner Neal Brendel to Dubai from its Pittsburgh office.

Dorsey & Whitney Cuts 55 Staffers Firmwide [Update]

Erik Even — Wed, 03 Jun 2009 16:10:41 +0000

Minneapolis, Minnesota-based Dorsey & Whitney has laid off 55 staff members, or 7% of the firm’s support staff.

Seven of the firm’s offices were targeted, but 38 of the layoffs were at the Minneapolis headquarters.

The firm saw flat revenues, with a small decrease in profits per partner, in 2008.

Dorsey & Whitney LLP is a large law firm, with close to 700 lawyers and 850 staff, located in 19 offices in the United States, Canada, Europe, and Asia.

UPDATE

The firm also this week implemented a 10% salary reduction for all associates. Contract lawyers are being asked to take a similar cut. This is on top of an existing salary freeze.

Snell & Wilmer Lays Off Up to 40 Staffers [Update 2]

Erik Even — Sun, 31 May 2009 15:09:18 +0000

Snell & Wilmer has laid off between 30 and 40 staff members, most at its Phoenix, Arizona headquarters. A more precise number has not been provided.

No lawyers were affected.

Snell & Wilmer was founded in 1938 by Frank Snell Jr. and Mark Wilmer. The firm is the largest in the state of Arizona and the 99th largest in the US by number of lawyers, according to the National Law Journal’s 2007 statistics. The southwestern regional firm, which has about 1,000 employees, also has offices in seven other cities in Arizona, California, Nevada, Utah and Los Cabos, Mexico.

UPDATE

A JDJournal tipster claims that Snell & Wilmer has in fact been laying off associates since January, with 30 let go last month.

UPDATE 2

Another tipster says (edited for clarity and length):

Snell has been shedding lawyers for months under the guise of “not making hours.” The firm has a tough billables requirement that is hard to hit even in better times. Thus, they have a built-in reason for not making [new] partners, layoffs, etc.

Don’t expect any survivors to talk, the confidentiality agreement attorneys and staff have to sign regarding firm business is tough. The sick (no pun intended) aspect to the staff layoffs is for the past few years the firm has been targeting anyone with a health concern. The firm went in-house with health care about five years ago to save on insurance premiums. This gives the firm full access to everyone’s medical files. Since then, personnel has been targeting staffers with high medical costs. I’ve seen e-mails from the company handling claims which contain lists of meds and surgical costs. Why would these e-mails go to the personnel director instead of the benefits administrator?

If you have any information about stealth attorney layoffs at Snell & Wilmer, please send us a confidential tip!

Ropes & Gray Cuts Up to 40 Associates [Update]

Erik Even — Wed, 27 May 2009 17:02:33 +0000

Ropes & Gray, which deferred start dates in March, has let go between 30 and 40 associates.

Blawgs are reporting that the layoffs include eight two first year associates.

If you have any details, please send us a confidential tip!

Ropes & Gray LLP is a national law firm with offices located in Boston, New York City, Palo Alto, San Francisco, Washington, Chicago, Hong Kong and Tokyo; and a conference center in London. The firm has over 1,000 lawyers worldwide.

UPDATE

The firm confirms it has sent home only two first year associates, not the 8 to 10 initially reported online.

Sonnenschein to Slash Associate Pay [Update]

Erik Even — Tue, 26 May 2009 16:40:43 +0000

Sonnenschein Nath & Rosenthal plans to cut associate salaries, beginning June 1st.

First year salaries, previously a Biglaw standard $160,000, will be reduced to $145,000.

Sonnenschein seeks to make associate salaries performance-based, and will create an associate-partner committee to work out the details. This year, the firm will have a merit-based bonus program; bonuses will be paid in January 2010.

Sonnenschein Nath & Rosenthal LLP is an international law firm with 700 lawyers and other professionals in the United States and Europe. Founded in Chicago in 1906, it has 14 offices in the US and Europe.

UPDATE

Online sources have obtained further details about the salary reductions for Sonnenschein associates — the longer a lawyer has been with the firm, the more their pay will be cut.

If an associate started in 2004 or earlier, the pay cut is 15%. Those who started in 2005/6 take a 14% cut. And the 2008 class is taking a 10% cut.

Kummer Kaempfer Partners Leave After Failed Greenberg Traurig Merger [Update]

Erik Even — Tue, 26 May 2009 16:30:17 +0000

Founding partner Thomas Kummer and managing partner Michael Bonner are leaving Las Vegas, Nevada’s Kummer Kaempfer, after the collapse of merger talks with Greenberg Traurig.

Bonner, along with other partners and staffers, will jump ship to Greenberg Traurig’s 30-lawyer Vegas office in June.

Bob Gronauer will take over as Kummer Kaempfer’s managing partner. This year, Kummer Kaempfer laid off about 10 lawyers and associated staff.

Kummer Kaempfer Bonner Renshaw & Ferrario is one of Nevada’s largest and most prominent law firms, with offices in Vegas, Reno and Carson City.

Greenberg Traurig LLP is an international, full-service law firm with more than 1,800 attorneys and governmental affairs professionals in the US, Europe and Asia. The firm was selected as the 2007 USA Law Firm of the Year by Chambers & Partners.

UPDATE

We now know that at least 10 attorneys from Kummer Kaempfer are joining Greenberg Traurig. The move is also expected to lead to the layoffs of around 15 support staff at Kummer Kaempfer.

In addition to Kummer and Bonner, the group includes Mark Ferrario, John Brewer, John Jeppsen, Greg Vermeys, Brandon Roos, Eric Blum, Jordan Pinjuv and Michael Shalmy.

Dechert Snags Chadbourne & Parke Partners to Found Moscow Office [Update]

Erik Even — Thu, 14 May 2009 21:40:02 +0000

Dechert announced today that it has lured away from Chadbourne & Parke five partners to found a Moscow office.

The team is headed by Chadbourne’s Laura Brank, formerly the firm’s managing partner for Moscow and St. Petersburg.

Moscow will be Dechert’s ninth foreign office. In 2008, the firm launched two offices in China.

The firm laid off 63 lawyers and 62 staff in March.

Founded in 1975, Dechert LLP is an international law firm of more than 1,000 lawyers with top-ranked practices in corporate and securities, complex litigation, finance and real estate, and financial services and asset management.

UPDATE

Two of Chadbourne & Parke’s Moscow partners, senior partner Mikhail Rozenberg and finance partner Jennifer Handz, say they will not join the group heading to Dechert, and will remain with Chadbourne along with three counsel.

Managing partner Laura Brank and finance partners Shane DeBeer and Konstantin Konstantinov will move to Dechert.

Madoff Charged in $50 Billion-with-a-”B” Fraud, Sued by SEC [UPDATE]

Erik Even — Sat, 13 Dec 2008 00:36:03 +0000

Bernard Madoff, founder and president of a New York firm that invested funds for wealthy individuals, hedge funds and other institutions, has been charged with operating what he told employees was a long-running $50 billion Ponzi scheme, in what may be one of the largest frauds in history.

Madoff, 70, head of Bernard L. Madoff Investment Securities LLC, was arrested this morning by the FBI.

US Magistrate Judge Douglas Eaton released Madoff on $10 million bond. Madoff faces as much as 20 years in prison and a $5 million fine if convicted.

The New York-based firm was the 23rd largest market maker on Nasdaq in October, handling a daily average of about 50 million shares a day. It specialized in handling orders from online brokers in some of the largest US companies, including General Electric and Citigroup.

Madoff was also sued today by the Securities and Exchange Commission. The complaint, also filed in Manhattan federal court, accused Madoff of a “multi-billion dollar Ponzi scheme that he perpetrated on advisory clients of his firm.”

The agency said it’s seeking emergency relief for investors, including an asset freeze and the appointment of a receiver for the firm.

Madoff ran his investment advisory business from a separate floor of his firm’s office, keeping financial statements “under lock and key,” prosecutors said.

While meeting with co-workers at his home yesterday, Madoff conceded that he was “finished,” that his advisory business is “all just one big lie” and “basically, a giant Ponzi scheme,” the government said. The business had been insolvent for years with losses of about $50 billion, he told the employees, according to the criminal and SEC complaints.

Madoff said he had about $200 million to $300 million left and planned to distribute money to select employees, family and friends before surrendering to authorities in about a week, the government said.

UPDATE

From MarketWatch:

Milberg LLP and Seeger Weiss LLP announced today that the two firms have been retained by dozens of individual investors in Madoff Investment Securities. Collectively, these investors have lost hundreds of millions of dollars–and possibly more than a billion–due to the stunning fraud allegedly perpetrated by Bernard Madoff.

“We are moving quickly and decisively to represent the interests of outraged investors–both individual and institutional–who were persuaded to entrust their money with Madoff Investment Securities and its founder, Bernard Madoff,” said Brad Friedman, a partner at Milberg LLP.

“Those taken in by this Ponzi scheme who have turned to us for help include a senior citizens center, corporate executives, banks, hedge funds and a wide variety of others,” according to Stephen Weiss, a partner at Seeger Weiss LLP.