Cravath, Swaine, & Moore LLP
Published February 2011
2011 Vault Ranking: 2
Cravath, Swaine, & Moore is both among the oldest and the most prestigious law firms in the United States. As a firm, it can trace its roots back to 1819, second only to Cadwalader, Wickersham & Taft. Though one of the most prominent firms in the country, if not the world, Cravath has stayed relatively small, with only 500 attorneys spread between two offices, in New York and London. Through its storied history, Cravath has been home to a number of notable attorneys, including two Supreme Court justices, numerous high-ranking government officers, and a fair share of notable academics.
Cravath has been a leader and a touchstone for the New York centric big law community in many ways. Most notably, name partner Paul Cravath, who joined the firm in 1899, is responsible for introducing the “Cravath System.” The system has since been adopted, in whole or in part by many other major firms. Key features of this system that are taken for granted now include the focus on hiring the best students from the best schools, and paying associates a salary. It also featured “up or out” as a key element, where associates who were not going to be promoted or not expected to achieve partner within at most ten years were asked to leave the firm.
More recently, Cravath has been the market leader for compensation among large firms, including the payment of bonuses. Immediately before the 2008 downturn, Cravath led the pack by being the first to pay “special” bonuses on top of regular annual bonuses. When the downturn hit, Skadden attempted to pay full bonuses as it did in the past. When Cravath instead announced it would only pay bonuses half the size of Skadden, much of the big law market followed suit, matching Cravath. Barring major changes in the legal market, this is likely to continue.
Because Cravath does not have the sheer number of attorneys that some firms possess, the firm will not necessarily have a specialist in every area of the law. However, Cravath is still a full service firm, and is among the best at every practice area in which they choose to participate.
Cravath is most well known for its corporate and transactional groups. For two hundred years, it has been a leading transactional firm, with attorneys including William Seward, the architect of the purchase of Alaska from Russia. The firm has been a key player in a number of major mergers, including DuPont-Conoco, Ford-Jaguar, Bristol-Meyers-Squibb, Time-Warner, and AOL-Time-Warner. Chambers and Partners ranks Cravath in Band 1 for Banking and Finance, Capital Markets, M&A, and tax.
Though most well known for its corporate side, Cravath also has a very strong litigation group. It has been engaged in such litigation as representing Netscape in its antitrust suit against Microsoft, resulting in a $750 million settlement, as well as a number of famous libel suits, defending Time, Inc. and CBS. Cravath is listed in Band 1 by Chambers and Partners for general commercial litigation, securities litigation, and antitrust.
Not surprisingly for a firm of its stature, hiring at Cravath is one of the most competitive processes of all firms. Ingrained in the Cravath model is the notion of hiring the best of the best from the best schools. As part of this, the firm is one of the few that uses full day callbacks, ostensibly to be certain that they weed out those who do not fit the mold.
The summer program itself has both similarities and stark differences compared to that of other firms. The ten-week long program features the usual weekly social events, such as Shakespeare in the Park or a day at the Belmont races, as well as generous allowances for attorney lunches (though limited to only one per week). Summer associates report that the program is a great experience, with lots of partner contact. However, summer at Cravath diverges sharply from many other firms in that the firm expects summer associates to be treated like any other associate. This means it is entirely common for summer associates to work past 7:30 PM every day of the week, and regularly work weekends. The summer program is not for the faint of heart. However, if the interviewers have done their job, the only people in the summer program will all be perfectionist workaholics whose hopes and dreams include billing 2400 hours a year.
Compensation and Benefits
Cravath is the market leader in compensation, each year being one of the first firms to announce bonuses, which other firms quickly match. Salary is based on a set, lock-step scale, and the firm has not announced any salary freezes. Bonuses at Cravath require billing 2000 hours, but every associate is virtually guaranteed to bill significantly more than that. Like salary, bonuses are entirely lock-step as well based on year.
The firm has a single partnership track, averaging seven or eight years. The firm very rarely seeks lateral partners. Cravath added only two partners from outside the firm ranks in the past twenty years. Prior to that, another partner was added in 1987, but he was previously a Cravath associate, so was considered not to be a “true” lateral. Before that, the last true lateral was in 1943. However despite this, promotion prospects are slim. In 2009, the firm made zero partners. Only three partners were added in each of 2008 and 2007, while associate class sizes have ranged from 25 to 100 summers. The difference is made up between significant attrition and the previously mentioned “up or out” policy.
Becoming partner requires hard work (which is saying something for a firm where 2500 hours billed a year is average) and extreme perfectionism in your work. It is an extreme long shot, but for those few lucky enough to make the position, Cravath’s profit per partner is second to only Wachtell, with nearly five million dollars per partner in 2008.
Cravath is a firm that has no illusions as to its character. It is among the whitest of the white shoe firms, with a long history of prestige and excellence. The Cravath System was instituted to hire the best and brightest, then mold them into Cravath attorneys. It was specifically premised on the idea that lateral attorneys would have bad habits that would be difficult to break. The firm was described in a Vault survey as “Uber-Professional.”
The firm is described as often promoting a family-like atmosphere. Given the sheer number of hours attorneys at the firm spend together, it makes sense that they would encourage affability. Partners are polite, respectful, and cordial while they work their associates to death. Associates are expected to always be “on call.” Nights, weekends, and vacations are all fair game as far as partners are concerned. However, every associate is there voluntarily because they want to be part of what Cravath has to offer. Much like at Wachtell, most associates wouldn’t have it any other way.
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