Big Law Exit Options

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Alex-Trof
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Big Law Exit Options

Postby Alex-Trof » Wed Mar 02, 2011 11:27 pm

I've found some threats on that, but they're all seem to be old (pre ITE).

Given current state of economy what happens to that 80% of associates that do not make partner? Are federal govt,, in-house counsel, or mid/boutique law lateral jobs still available to associates at big firms? Do they get those offers or they have to go out there network, send resumes, hire headhunters? How often are those available? Is the pay cut getting bigger? Are horror stories of going from 300K to 55K/unemployed common? Should new employees start planning exit strategy from day one at Big Law?

Sorry, I know it is way too many questions for one threat. But I am just very curious and looking for people to present this info in some comprehensive stories about Big Law exit options.

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fatduck
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Re: Big Law Exit Options

Postby fatduck » Wed Mar 02, 2011 11:29 pm

Image

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fatduck
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Re: Big Law Exit Options

Postby fatduck » Wed Mar 02, 2011 11:30 pm

on a more serious note: here is a good thread about in-house positions viewtopic.php?f=23&t=117834 (it's from last year, not that old)

legends159
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Re: Big Law Exit Options

Postby legends159 » Wed Mar 02, 2011 11:32 pm

based on the spring-bonuses and the ATL comments and from my conversations with associates (both of which you should take with a grain of salt) it seems that the lateral market is heating up again.

From what I hear, until you're a 4th year your only lateral options will be to lower ranked firms where you do the same job. It's the 4-6 year that is the sweet spot for lateraling b/c you have developed skill sets at that point in terms of being able to lead projects and delegate work. A small sample of the desirable skill set is: for litigation, being able to run a document review team and drafting briefs/motions. For corporate, being able to run a diligence team and draft contracts/prospectus.

oh and in terms of how you get these lateral options. From what I hear, most lawfirm to lawfirm lateraling is driven by headhunters who call you. They take a cut of your salary from the firm so their goal isn't to place you where you should be, but just to place you where the firm has a need. I've talked to 4th year associates who tell me they get at least 5-10 calls/emails a week from headhunters. 2nd-3rd years tell me they get maybe 1-2.

For in-house it's usually networking driven -- these are not jobs that are advertised. For gov't you apply.

edit: and by network driven I mean that you'll either get an interview through a partner you work for or from the client. An example might be that a client, say a bank, calls up a partner and says he needs someone with experience working with underwriters in drafting a securities offering. Or someone with experience doing regulatory compliance work and knows how to draft contracts in compliance with new Dodd Frank provisions. Your partner might select you b/c s/he knows you do good work (will make client happy) and that you're loyal to the firm so you'll refer work back to the firm -- and to him/her -- if you get the job in-house. The other situation may be that you build a good relationship with an institutional client b/c you work with them all the time and they try to poach you (behind the firm's back). These are just two examples in an array of opportunities that can spring up because you work for a biglaw firm and do good work (that's noticed).

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Alex-Trof
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Re: Big Law Exit Options

Postby Alex-Trof » Thu Mar 03, 2011 12:16 am

Thanks guys!

adude
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Re: Big Law Exit Options

Postby adude » Thu Mar 03, 2011 4:58 am

when you lateral to a firm, do you just start over on the partner track with a clean slate at the new firm, or do you have a reduced number of years to make it partner? in other words, if you made a lateral move as a fifth year associate to a firm with a seven year track, would you only have two years to make it to partner?

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Kabuo
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Re: Big Law Exit Options

Postby Kabuo » Thu Mar 03, 2011 5:16 am

Alex-Trof wrote:I've found some threats on that, but they're all seem to be old (pre ITE).

Given current state of economy what happens to that 80% of associates that do not make partner? Are federal govt,, in-house counsel, or mid/boutique law lateral jobs still available to associates at big firms? Do they get those offers or they have to go out there network, send resumes, hire headhunters? How often are those available? Is the pay cut getting bigger? Are horror stories of going from 300K to 55K/unemployed common? Should new employees start planning exit strategy from day one at Big Law?

Sorry, I know it is way too many questions for one threat. But I am just very curious and looking for people to present this info in some comprehensive stories about Big Law exit options.


? If this is not a typo, unless someone is doing it wrong, most of the things you read on here will be threads.

legends159
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Re: Big Law Exit Options

Postby legends159 » Thu Mar 03, 2011 12:00 pm

adude wrote: if you made a lateral move as a fifth year associate to a firm with a seven year track, would you only have two years to make it to partner?


yes

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FalafelWaffle
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Re: Big Law Exit Options

Postby FalafelWaffle » Thu Mar 03, 2011 12:10 pm

Alex-Trof wrote:I've found some threats on that, but they're all seem to be old (pre ITE).

Given current state of economy what happens to that 80% of associates that do not make partner? Are federal govt,, in-house counsel, or mid/boutique law lateral jobs still available to associates at big firms? Do they get those offers or they have to go out there network, send resumes, hire headhunters? How often are those available? Is the pay cut getting bigger? Are horror stories of going from 300K to 55K/unemployed common? Should new employees start planning exit strategy from day one at Big Law?

Sorry, I know it is way too many questions for one threat. But I am just very curious and looking for people to present this info in some comprehensive stories about Big Law exit options.


No one's entitled to earn in the mid to high six figures for the rest of their career just because they had a BigLaw job once. And everyone gets laid off occasionally, and yes this usually entails, *gasp* networking, and resume editing and all the things people typically do when they're out of work. God forbid you might actually have to look for a job after you have your J.D. and have worked for a prestigious firm! The sense of entitlement on this forum is astounding sometimes.

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Malcolm8X
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Re: Big Law Exit Options

Postby Malcolm8X » Thu Mar 03, 2011 12:16 pm

legends159 wrote:based on the spring-bonuses and the ATL comments and from my conversations with associates (both of which you should take with a grain of salt) it seems that the lateral market is heating up again.

From what I hear, until you're a 4th year your only lateral options will be to lower ranked firms where you do the same job. It's the 4-6 year that is the sweet spot for lateraling b/c you have developed skill sets at that point in terms of being able to lead projects and delegate work. A small sample of the desirable skill set is: for litigation, being able to run a document review team and drafting briefs/motions. For corporate, being able to run a diligence team and draft contracts/prospectus.

oh and in terms of how you get these lateral options. From what I hear, most lawfirm to lawfirm lateraling is driven by headhunters who call you. They take a cut of your salary from the firm so their goal isn't to place you where you should be, but just to place you where the firm has a need. I've talked to 4th year associates who tell me they get at least 5-10 calls/emails a week from headhunters. 2nd-3rd years tell me they get maybe 1-2.

For in-house it's usually networking driven -- these are not jobs that are advertised. For gov't you apply.

edit: and by network driven I mean that you'll either get an interview through a partner you work for or from the client. An example might be that a client, say a bank, calls up a partner and says he needs someone with experience working with underwriters in drafting a securities offering. Or someone with experience doing regulatory compliance work and knows how to draft contracts in compliance with new Dodd Frank provisions. Your partner might select you b/c s/he knows you do good work (will make client happy) and that you're loyal to the firm so you'll refer work back to the firm -- and to him/her -- if you get the job in-house. The other situation may be that you build a good relationship with an institutional client b/c you work with them all the time and they try to poach you (behind the firm's back). These are just two examples in an array of opportunities that can spring up because you work for a biglaw firm and do good work (that's noticed).


We need more posts like this. I'm always curious in what brings big law so much money, consistently. Esp. to be paying over 300+ associates over $160K each. I know partners have huge money making clients and I heard that partners in a big law firm setting acts essentially as a self owned business. But who makes up most of these clients? Is "poaching" seen as an act of betrayal by the firm and can get you in big trouble? Please elaborate on what other opportunities can spring up as a result of good work?

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Kohinoor
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Re: Big Law Exit Options

Postby Kohinoor » Thu Mar 03, 2011 1:37 pm

Malcolm8X wrote:
legends159 wrote:based on the spring-bonuses and the ATL comments and from my conversations with associates (both of which you should take with a grain of salt) it seems that the lateral market is heating up again.

From what I hear, until you're a 4th year your only lateral options will be to lower ranked firms where you do the same job. It's the 4-6 year that is the sweet spot for lateraling b/c you have developed skill sets at that point in terms of being able to lead projects and delegate work. A small sample of the desirable skill set is: for litigation, being able to run a document review team and drafting briefs/motions. For corporate, being able to run a diligence team and draft contracts/prospectus.

oh and in terms of how you get these lateral options. From what I hear, most lawfirm to lawfirm lateraling is driven by headhunters who call you. They take a cut of your salary from the firm so their goal isn't to place you where you should be, but just to place you where the firm has a need. I've talked to 4th year associates who tell me they get at least 5-10 calls/emails a week from headhunters. 2nd-3rd years tell me they get maybe 1-2.

For in-house it's usually networking driven -- these are not jobs that are advertised. For gov't you apply.

edit: and by network driven I mean that you'll either get an interview through a partner you work for or from the client. An example might be that a client, say a bank, calls up a partner and says he needs someone with experience working with underwriters in drafting a securities offering. Or someone with experience doing regulatory compliance work and knows how to draft contracts in compliance with new Dodd Frank provisions. Your partner might select you b/c s/he knows you do good work (will make client happy) and that you're loyal to the firm so you'll refer work back to the firm -- and to him/her -- if you get the job in-house. The other situation may be that you build a good relationship with an institutional client b/c you work with them all the time and they try to poach you (behind the firm's back). These are just two examples in an array of opportunities that can spring up because you work for a biglaw firm and do good work (that's noticed).


We need more posts like this. I'm always curious in what brings big law so much money, consistently. Esp. to be paying over 300+ associates over $160K each. I know partners have huge money making clients and I heard that partners in a big law firm setting acts essentially as a self owned business. But who makes up most of these clients? Is "poaching" seen as an act of betrayal by the firm and can get you in big trouble? Please elaborate on what other opportunities can spring up as a result of good work?

In-house poaching can be troublesome to the firm since they have to replace you with someone competent but certainly isn't a source of ill will. It means that they have one more person on the inside who hopefully will go to bat for them when the client is deciding which firm to engage for outside counsel.

Kochel
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Re: Big Law Exit Options

Postby Kochel » Thu Mar 03, 2011 2:18 pm

legends159 wrote:For in-house it's usually networking driven -- these are not jobs that are advertised. For gov't you apply.

edit: and by network driven I mean that you'll either get an interview through a partner you work for or from the client. An example might be that a client, say a bank, calls up a partner and says he needs someone with experience working with underwriters in drafting a securities offering. Or someone with experience doing regulatory compliance work and knows how to draft contracts in compliance with new Dodd Frank provisions. Your partner might select you b/c s/he knows you do good work (will make client happy) and that you're loyal to the firm so you'll refer work back to the firm -- and to him/her -- if you get the job in-house. The other situation may be that you build a good relationship with an institutional client b/c you work with them all the time and they try to poach you (behind the firm's back). These are just two examples in an array of opportunities that can spring up because you work for a biglaw firm and do good work (that's noticed).


This is correct re: "poaching." But it is not common that a partner will tell an associate about an open in-house position unless (i) the associate has confided in the partner that he is thinking about leaving the firm (which is a dangerous thing to do) or (ii) the firm has given the associate the old you-have-six-months-to-find-another-job message.

Also, headhunters are quite active in in-house hiring--some even specialize in legal hiring for particular industries.

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robotclubmember
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Re: Big Law Exit Options

Postby robotclubmember » Thu Mar 03, 2011 2:49 pm

fatduck wrote:Image


god bless you for this sir

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Re: Big Law Exit Options

Postby Anonymous User » Thu Mar 03, 2011 3:20 pm

Malcolm8X wrote:We need more posts like this. I'm always curious in what brings big law so much money, consistently. Esp. to be paying over 300+ associates over $160K each. I know partners have huge money making clients and I heard that partners in a big law firm setting acts essentially as a self owned business. But who makes up most of these clients? Is "poaching" seen as an act of betrayal by the firm and can get you in big trouble? Please elaborate on what other opportunities can spring up as a result of good work?


It's all about stakes.

The numbers can be eye-popping even for fairly routine deals. For the biggest deals, the numbers are more like eye-exploding. The 1985 Revlon buyout for 2.7 billion comes to mind. That deal had lawyers on both sides plus lawyers for the banks and financial institutions involved. When stakes get that high, paying a few hundred dollars an hour in legal feels becomes a drop in the bucket for the parties involved.

The same applies to litigation, where dollars at stake dwarf legal fees.

In regulatory practice, the consequences of getting on the bad side of the SEC / FDA can mean the difference between a successful and a bankrupt company.

White collar crime practice turns on (very rich) people's livelihood, trusts and estates involves getting the tax treatment on huge sums of money right, etc.

When it comes to business development, a funny line I heard from a Cravath partner on an interview was that "we used to say business development meant answering the phone on the third ring." A lot of firms have such expertise that if somebody needs to do X, they go to that firm. Skadden would famously collect retainers from companies in exchange for services in the event there was a takeover bid - not necessarily because they though they needed Joseph Flom to defend them, but because having him on retainer meant nobody else could hire him to work against them.

It's a more competitive world now, with lots of big firms developing areas of expertise, but biglaw is pretty much synonymous with "extraordinarily high stakes" law.

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Malcolm8X
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Re: Big Law Exit Options

Postby Malcolm8X » Thu Mar 03, 2011 3:47 pm

Anonymous User wrote:
Malcolm8X wrote:We need more posts like this. I'm always curious in what brings big law so much money, consistently. Esp. to be paying over 300+ associates over $160K each. I know partners have huge money making clients and I heard that partners in a big law firm setting acts essentially as a self owned business. But who makes up most of these clients? Is "poaching" seen as an act of betrayal by the firm and can get you in big trouble? Please elaborate on what other opportunities can spring up as a result of good work?


It's all about stakes.

The numbers can be eye-popping even for fairly routine deals. For the biggest deals, the numbers are more like eye-exploding. The 1985 Revlon buyout for 2.7 billion comes to mind. That deal had lawyers on both sides plus lawyers for the banks and financial institutions involved. When stakes get that high, paying a few hundred dollars an hour in legal feels becomes a drop in the bucket for the parties involved.

The same applies to litigation, where dollars at stake dwarf legal fees.

In regulatory practice, the consequences of getting on the bad side of the SEC / FDA can mean the difference between a successful and a bankrupt company.

White collar crime practice turns on (very rich) people's livelihood, trusts and estates involves getting the tax treatment on huge sums of money right, etc.

When it comes to business development, a funny line I heard from a Cravath partner on an interview was that "we used to say business development meant answering the phone on the third ring." A lot of firms have such expertise that if somebody needs to do X, they go to that firm. Skadden would famously collect retainers from companies in exchange for services in the event there was a takeover bid - not necessarily because they though they needed Joseph Flom to defend them, but because having him on retainer meant nobody else could hire him to work against them.

It's a more competitive world now, with lots of big firms developing areas of expertise, but biglaw is pretty much synonymous with "extraordinarily high stakes" law.


Hmmmm... Very interesting. I see how the near freeze in liquidity from the crash temporarily devastated the legal market.

legends159
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Re: Big Law Exit Options

Postby legends159 » Thu Mar 03, 2011 5:58 pm

Malcolm8X wrote:
Hmmmm... Very interesting. I see how the near freeze in liquidity from the crash temporarily devastated the legal market.


It's not just that clients stopped paying, which is a problem b/c firms don't collect on a week to week basis from institutional clients.

But more importantly, law firms are highly leveraged. Firm pay out all the reserves at the end of the year to pay off loans, rent, year end salary, bonuses (etc), and whatever is left goes into the partner's pocket. Then they take out loans at the beginning of the year to meet overhead etc.

When there is a credit crisis and liquidity stops a few things happen which disrupt the above model.

1. Creditors might call back loans -- in which case firms will have to tap into their reserves. If they don't have enough partners willing to go into their own personal savings to make up the debt the firm goes insolvent. This is how Heller collapsed -- it wasn't that the firm was losing money per se, they had a liquidity problem

2. Creditors stop loaning. Firms are like corporations and they need to borrow short term cash to make payroll/overhead costs/rent etc. Like corporations, many firms get this cash from the money markets. When Lehman collapsed, the money market funds seized up as everyone pulled their cash from it and moved them to t-bills. Firms that lacked enough money (or partners willing to front the cash) had to cut costs by laying off staff. Otherwise they'd have to tell all the associates/staff that they won't be able to make payroll this month.

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Malcolm8X
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Re: Big Law Exit Options

Postby Malcolm8X » Thu Mar 03, 2011 9:34 pm

legends159 wrote:
Malcolm8X wrote:
Hmmmm... Very interesting. I see how the near freeze in liquidity from the crash temporarily devastated the legal market.


It's not just that clients stopped paying, which is a problem b/c firms don't collect on a week to week basis from institutional clients.

But more importantly, law firms are highly leveraged. Firm pay out all the reserves at the end of the year to pay off loans, rent, year end salary, bonuses (etc), and whatever is left goes into the partner's pocket. Then they take out loans at the beginning of the year to meet overhead etc.

When there is a credit crisis and liquidity stops a few things happen which disrupt the above model.

1. Creditors might call back loans -- in which case firms will have to tap into their reserves. If they don't have enough partners willing to go into their own personal savings to make up the debt the firm goes insolvent. This is how Heller collapsed -- it wasn't that the firm was losing money per se, they had a liquidity problem

2. Creditors stop loaning. Firms are like corporations and they need to borrow short term cash to make payroll/overhead costs/rent etc. Like corporations, many firms get this cash from the money markets. When Lehman collapsed, the money market funds seized up as everyone pulled their cash from it and moved them to t-bills. Firms that lacked enough money (or partners willing to front the cash) had to cut costs by laying off staff. Otherwise they'd have to tell all the associates/staff that they won't be able to make payroll this month.


Wow. That's remarkable stuff. I don't see why firms allow themselves to get SO leveraged when they got so much capital flowing in yearly. I guess the overly leveraged ones failed, the rest learned a lesson. This indicates to me that big law was just completely caught off guard by the depth of the recession. Hopefully everybody learned a lesson. :?

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Kohinoor
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Re: Big Law Exit Options

Postby Kohinoor » Fri Mar 04, 2011 1:28 am

Malcolm8X wrote:Hopefully everybody learned a lesson. :?

Yup. No matter how many people you layoff, you can still fill a class with T14ers.

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Malcolm8X
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Re: Big Law Exit Options

Postby Malcolm8X » Fri Mar 04, 2011 10:44 am

Kohinoor wrote:
Malcolm8X wrote:Hopefully everybody learned a lesson. :?

Yup. No matter how many people you layoff, you can still fill a class with T14ers.


So is it the consensus that the majority of the people they laid off won't be returning to their firms and that these firms will continue to fill the space with law school grads?

Kochel
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Re: Big Law Exit Options

Postby Kochel » Fri Mar 04, 2011 10:55 am

Malcolm8X wrote:
Kohinoor wrote:
Malcolm8X wrote:Hopefully everybody learned a lesson. :?

Yup. No matter how many people you layoff, you can still fill a class with T14ers.


So is it the consensus that the majority of the people they laid off won't be returning to their firms and that these firms will continue to fill the space with law school grads?


Yes. Except it's not just a majority who won't be returning, it's 100%.

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fatduck
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Re: Big Law Exit Options

Postby fatduck » Fri Mar 04, 2011 11:11 am

Kochel wrote:
Malcolm8X wrote:
Kohinoor wrote:
Malcolm8X wrote:Hopefully everybody learned a lesson. :?

Yup. No matter how many people you layoff, you can still fill a class with T14ers.


So is it the consensus that the majority of the people they laid off won't be returning to their firms and that these firms will continue to fill the space with law school grads?


Yes. Except it's not just a majority who won't be returning, it's 100%.

They will, however, go on to form the Rebel Alliance.


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Malcolm8X
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Re: Big Law Exit Options

Postby Malcolm8X » Fri Mar 04, 2011 11:28 am

Kochel wrote:
Malcolm8X wrote:
Kohinoor wrote:
Malcolm8X wrote:Hopefully everybody learned a lesson. :?

Yup. No matter how many people you layoff, you can still fill a class with T14ers.


So is it the consensus that the majority of the people they laid off won't be returning to their firms and that these firms will continue to fill the space with law school grads?


Yes. Except it's not just a majority who won't be returning, it's 100%.


If this is true, which I sincerely hope you are, that bodes well for the Class of 2013 & 2014. And fatduck, do you mean Rebel Alliance as in they start their own firm?

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fatduck
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Re: Big Law Exit Options

Postby fatduck » Fri Mar 04, 2011 11:33 am

Malcolm8X wrote:
Kochel wrote:
Malcolm8X wrote:
Kohinoor wrote:Yup. No matter how many people you layoff, you can still fill a class with T14ers.


So is it the consensus that the majority of the people they laid off won't be returning to their firms and that these firms will continue to fill the space with law school grads?


Yes. Except it's not just a majority who won't be returning, it's 100%.


If this is true, which I sincerely hope you are, that bodes well for the Class of 2013 & 2014. And fatduck, do you mean Rebel Alliance as in they start their own firm?

no i meant like this:

--ImageRemoved--

i have no idea what happens to the lost generation. i suspect they're doing contract work and trying to find jobs at small firms.

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Re: Big Law Exit Options

Postby 174 » Fri Mar 04, 2011 12:01 pm

fatduck wrote:i have no idea what happens to the lost generation. i suspect they're doing contract work and trying to find jobs at small firms.


Megapoasting on xo.




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