Live action collapse of a big law firm

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A&O
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Re: Live action collapse of a big law firm

Postby A&O » Mon Jan 24, 2011 10:47 pm

that kind of has to hurt the potential profits for those who remain even further?


It's a slippery slope, and I don't see it stopping until the firm is gone. No partner will touch that firm with a 10-foot pole, and every partner at that firm is negotiating their way out (or at least should be).

Aqualibrium
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Re: Live action collapse of a big law firm

Postby Aqualibrium » Mon Jan 24, 2011 11:30 pm

It's really unfortunate that this is happening to Howrey specifically. I was very intrigued to see whether more firms would adopt their two year associate training system. Even if it is truly a great system, and it had absolutely nothing to do with this collapse in any way, I don't think this bodes well for copy cats.

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The Stig
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Re: Live action collapse of a big law firm

Postby The Stig » Mon Jan 24, 2011 11:41 pm

thesealocust wrote:Is there really no interest in this?

Howrey has lost 71 partners recently, and closed several offices. The most recent departure, a co-chair of a major practice group, was today.

http://www.thelawyer.com/partner-exodus ... 26.article

--LinkRemoved--


up to 127 right now....

this is surreal to follow, I can't imagine what the environment is like there right now...

bdubs
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Re: Live action collapse of a big law firm

Postby bdubs » Tue Jan 25, 2011 12:45 am

This is unbelievable...

How does the transfer of books of business work in a situation like this?

Do partners usually take some associates (or counsel etc..) with them?

missinglink
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Re: Live action collapse of a big law firm

Postby missinglink » Tue Jan 25, 2011 12:48 am

The Stig wrote:
thesealocust wrote:Is there really no interest in this?

Howrey has lost 71 partners recently, and closed several offices. The most recent departure, a co-chair of a major practice group, was today.

http://www.thelawyer.com/partner-exodus ... 26.article

--LinkRemoved--


up to 127 right now....

this is surreal to follow, I can't imagine what the environment is like there right now...

http://www.youtube.com/watch?v=VlxVA2mlLOU
Something like this?

I've read at other places that partners will usually try to take some of the better associates with them once they bail. Obviously, though, not everyone can fit on the life-raft.

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OperaSoprano
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Re: Live action collapse of a big law firm

Postby OperaSoprano » Tue Jan 25, 2011 1:05 am

Wow, this is scary stuff. I have a friend going to that firm.

I'm glad I don't have to track or follow the shit going down in biglaw, but for my friend's sake I hope this is not as bad as it seems.

Merriweather
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Re: Live action collapse of a big law firm

Postby Merriweather » Tue Jan 25, 2011 12:49 pm

OperaSoprano wrote:. I have a friend going to that firm.

not anymore

Younger Abstention
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Re: Live action collapse of a big law firm

Postby Younger Abstention » Tue Jan 25, 2011 1:55 pm

Holy shit, PPP is down to 550k. Stick a fork in them.

bdubs
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Re: Live action collapse of a big law firm

Postby bdubs » Tue Jan 25, 2011 1:56 pm

Younger Abstention wrote:Holy shit, PPP is down to 550k. Stick a fork in them.


Recalculate using the remaining number of partners? :-)

markymark
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Re: Live action collapse of a big law firm

Postby markymark » Thu Jan 27, 2011 12:58 pm

Merriweather wrote:
OperaSoprano wrote:. I have a friend going to that firm.

not anymore


This, sadly.

That being said, Howrey is probably the last place anyone should have picked coming out of OCI. The only acceptable reason for picking Howrey would be that it was your only offer.

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Kohinoor
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Re: Live action collapse of a big law firm

Postby Kohinoor » Thu Jan 27, 2011 1:42 pm

markymark wrote:
Merriweather wrote:
OperaSoprano wrote:. I have a friend going to that firm.

not anymore


This, sadly.

That being said, Howrey is probably the last place anyone should have picked coming out of OCI. The only acceptable reason for picking Howrey would be that it was your only offer.

I could see someone with Howrey and regional midlaw offers rationalizing their way to Howrey.

bdubs
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Re: Live action collapse of a big law firm

Postby bdubs » Thu Jan 27, 2011 1:45 pm

Kohinoor wrote:
markymark wrote:
Merriweather wrote:
OperaSoprano wrote:. I have a friend going to that firm.

not anymore


This, sadly.

That being said, Howrey is probably the last place anyone should have picked coming out of OCI. The only acceptable reason for picking Howrey would be that it was your only offer.

I could see someone with Howrey and regional midlaw offers rationalizing their way to Howrey.


Just curious why you all think this. Is it because of previous layoffs/no offers, or some other reputation issue?

A&O
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Re: Live action collapse of a big law firm

Postby A&O » Thu Jan 27, 2011 1:46 pm

I suspect there is a little hindsight bias going on here. But, then again, law students should have done their due diligence. Looking at abovethelaw, firm financials, lawshucks, chambers, career center, etc. can provide a valuable insight into how well a firm is doing.

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Kohinoor
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Re: Live action collapse of a big law firm

Postby Kohinoor » Thu Jan 27, 2011 1:48 pm

bdubs wrote:
Kohinoor wrote:I could see someone with Howrey and regional midlaw offers rationalizing their way to Howrey.


Just curious why you all think this. Is it because of previous layoffs/no offers, or some other reputation issue?

It's biglaw. You get your foot in biglaw for a few years and the world is your oyster. If I had an offer in biglaw with the guarantee that the firm would collapse on my fourth anniversary with them OR I could take something in midlaw, it would probably be reasonable to take the years of biglaw and try my lateral luck later. If you thought Howrey had a few more years, why not take the offer?

A&O
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Re: Live action collapse of a big law firm

Postby A&O » Thu Jan 27, 2011 1:49 pm

Just curious why you all think this. Is it because of previous layoffs/no offers, or some other reputation issue?


1) Layoffs. Howrey was one of the few big firms to continue blatant layoffs in 2010.
2) No offers.
3) Partner defections that were occurring well before and during 2010 OCI.
4) A shockingly bad decline in revenue and PPP.
5) The "bootcamp" spiel. Basically, in my opinion, for a big firm to modify basic compensation and training in response to the financial crisis is a huge red flag. For instance, after Wilmer switched to their system, I was pretty weary about them. Now that they're doing significantly better, I wouldn't be surprised to see them switch back to lockstep. DC firms, however, are harder to gauge for these sorts of things, as the lower magnitude of profits sometimes warrants a distinct compensation system.

A&O
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Re: Live action collapse of a big law firm

Postby A&O » Thu Jan 27, 2011 1:51 pm

You get your foot in biglaw for a few years and the world is your oyster.


I don't think this is at all true. In think the decline in exit options is very steep for big firm lawyers. For the corporate attorney at Simpson, the world is their oyster. For the attorney at Dechert, not so much.

bdubs
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Re: Live action collapse of a big law firm

Postby bdubs » Thu Jan 27, 2011 1:51 pm

Kohinoor wrote:
bdubs wrote:
Kohinoor wrote:I could see someone with Howrey and regional midlaw offers rationalizing their way to Howrey.


Just curious why you all think this. Is it because of previous layoffs/no offers, or some other reputation issue?

It's biglaw. You get your foot in biglaw for a few years and the world is your oyster. If I had an offer in biglaw with the guarantee that the firm would collapse on my fourth anniversary with them OR I could take something in midlaw, it would probably be reasonable to take the years of biglaw and try my lateral luck later. If you thought Howrey had a few more years, why not take the offer?


I was wondering why it would have been thought of as any different than other firms of the same level (e.g. 145k in major markets). There are plenty of them out there that didn't collapse, so either its a case of hindsight or there is something else that is different about Howrey.

Curious because I have worked with Howrey before and consider them to be respectable.

Edit: Thanks A&O

A&O
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Re: Live action collapse of a big law firm

Postby A&O » Thu Jan 27, 2011 1:53 pm

There are plenty of them out there that didn't collapse, so either its a case of hindsight or there is something else that is different about Howrey.

Curious because I have worked with Howrey before and consider them to be respectable.


(1) Howrey used to be a highly respectable old-line antitrust firm. They typically counseled companies in major deals back in the day.

(2) In my opinion, any firm that switched to 145k in a market that pays 160k, and hasn't returned to 160k, is a firm that should be avoided if better options are present. In that way, Howrey is no different.

But there were many issues unique to Howrey aside from the 145k stuff that made the firm a no-man's land.

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RVP11
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Re: Live action collapse of a big law firm

Postby RVP11 » Thu Jan 27, 2011 5:20 pm

Kohinoor wrote:
bdubs wrote:
Kohinoor wrote:I could see someone with Howrey and regional midlaw offers rationalizing their way to Howrey.


Just curious why you all think this. Is it because of previous layoffs/no offers, or some other reputation issue?

It's biglaw. You get your foot in biglaw for a few years and the world is your oyster. If I had an offer in biglaw with the guarantee that the firm would collapse on my fourth anniversary with them OR I could take something in midlaw, it would probably be reasonable to take the years of biglaw and try my lateral luck later. If you thought Howrey had a few more years, why not take the offer?


Why not go straight to MidLaw? Exit options from firms like Howrey are a far cry from V10 or V25 exit options (which themselves are exaggerated on both TLS and xoxo).
Last edited by RVP11 on Thu Jan 27, 2011 5:24 pm, edited 1 time in total.

A&O
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Re: Live action collapse of a big law firm

Postby A&O » Thu Jan 27, 2011 5:22 pm

Why not go straight to MidLaw?


They pay less for the same hours? They routinely have no intention of hiring their 2L summer associates? Stuff like that.

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RVP11
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Re: Live action collapse of a big law firm

Postby RVP11 » Thu Jan 27, 2011 5:27 pm

A&O wrote:
Why not go straight to MidLaw?


They pay less for the same hours? They routinely have no intention of hiring their 2L summer associates? Stuff like that.


I meant in the situation of competing offers from, say, a strong regional MidLaw firm (so paying less, but lower cost of living and lower hours) and a Vault firm like Howrey that has engaged in layoffs and no-offers.

I admit I'm perhaps including too many firms in "MidLaw." Like 200-300 attorney firms with offices in a few cities in flyover country.

Anonymous User
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Re: Live action collapse of a big law firm

Postby Anonymous User » Thu Jan 27, 2011 7:33 pm

RVP11 wrote:
A&O wrote:
Why not go straight to MidLaw?


They pay less for the same hours? They routinely have no intention of hiring their 2L summer associates? Stuff like that.


I meant in the situation of competing offers from, say, a strong regional MidLaw firm (so paying less, but lower cost of living and lower hours) and a Vault firm like Howrey that has engaged in layoffs and no-offers.

I admit I'm perhaps including too many firms in "MidLaw." Like 200-300 attorney firms with offices in a few cities in flyover country.


Any firm with 200-300 lawyers is SAFELY inside the NLJ 250, so it depends on your definitions of both biglaw and midlaw...

Smaller markets are the place to be anyway, so I totally agree with you, though... I'm a fan of even smaller local/regional firms too--there are many (varying by city, though) that pay "market" (for their respective markets) and do really top-notch work.

run26.2
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Re: Live action collapse of a big law firm

Postby run26.2 » Fri Feb 04, 2011 8:20 pm

So do summers have breach of contract claims against Howrey if the firm folds? Maybe someone who held a market offer could actually use this to argue that, in reliance on Howrey's offer, they turned down a better offer and recover more than they would have gotten from Howrey in salary?

This could be a bittersweet result - getting compensated without working. Of course, in the grander scheme of things, it would hardly be worth it given how important 2L summer work is to one's legal career.

The other thing is there would have to be some assets left over to pay these claims which does not seem likely given the firm's other obligations (e.g. leases, outstanding debt).
Last edited by run26.2 on Fri Feb 04, 2011 8:24 pm, edited 2 times in total.

Younger Abstention
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Re: Live action collapse of a big law firm

Postby Younger Abstention » Fri Feb 04, 2011 8:22 pm

run26.2 wrote:So do summers have breach of contract claims against Howrey if the firm folds? Maybe someone who held a market offer could actually use this to argue that, in reliance on Howrey's offer, they turned down a better offer and recover more than they would have gotten from Howrey in salary?


uhh... i wish them good luck with that.

Aqualibrium
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Re: Live action collapse of a big law firm

Postby Aqualibrium » Fri Feb 04, 2011 8:23 pm

run26.2 wrote:Don't mind me, I'm just a 1L. So do summers have breach of contract claims against Howrey if the firm folds? Maybe someone who held a market offer could actually use this to argue that, in reliance on Howrey's offer, they turned down a better offer and recover more than they would have gotten from Howrey in salary?



Fixed



Calm down. It's a joke.




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