Which law firms may follow Dewey..and which law firms won't? Forum

[msblaw89]

When many rising 2Ls and 3Ls begin to send out resumes, attend OCI, and attend other job fairs... which other Vault law firms do you think have the potential to go under like Dewey ( stay away from these!) and which law firms seem pretty solid ( they will probably be around for the next 10 years making $$$)?

[Anonymous User]

Anecdotally more volatile:
White & Case, Orrick, O'Melveny(maybe not anymore)

Anecdotally more Stable firms:
Basically the v15, outside of maybe Weil, who I think is still deferring people.

[msblaw89]

Have any current 2Ls or 1Ls received a substantially lower SA weekly pay than what is "typical"?

[Coco_Local]

Pretty much any place that focuses on lateral talent. I would guess whereever the Howrey, Thelen, and other bust attorneys ended up would be in danger.

[dbt]

Pretty much any place that focuses on lateral talent. I would guess whereever the Howrey, Thelen, and other bust attorneys ended up would be in danger.

A good number of Howrey are now at Covington.

[Anonymous User]

Pretty much any place that focuses on lateral talent. I would guess whereever the Howrey, Thelen, and other bust attorneys ended up would be in danger.

A good number of Howrey are now at Covington.

Add covington to list.

[Anonymous User]

Covington also picked up a couple of Dewey partners this past week.

That said, I do not think Covington belongs on this list. It seems like a firm that has grown conservatively and for the most part resisted the "bigger is better" trend.

Disclaimer: I am an incoming Covington SA.

[dbt]

Pretty much any place that focuses on lateral talent. I would guess whereever the Howrey, Thelen, and other bust attorneys ended up would be in danger.

A good number of Howrey are now at Covington.

Add covington to list.

Lol I meant that the claim seems too broad. I'm pretty doubtful Covington is going under. FWIW, Howrey was right across the street.

[Morgan12Oak]

Point 1: this thread is retarded for the very reason that no other law firms have the type of debt Dewey does.
Point 2: you're speculating about business of law firms which none of us have any information about since we don't have access to their financials
Point 3: The Anonymous posting in this thread is stupid. Just because you're anonymous doesn't mean you aren't retarded. HTH

[Anonymous User]

Nobody can tell. Very few people saw Dewey coming. I think rapid growth and expansion through lateral hiring is an important variable to look at, but even what a lot of people would think of as secure firms (S&C, DPW, STB) are doing a lot of lateral hiring to grow their international practices.

An interesting thing to look at is that since the 2001 Vault rankings, 9 of the 100 firms on the list have imploded:
Brobeck Phleger, Dewey Balllantine, LeBoeuf Lamb, Venture Law Group, Coudert Brothers, Testa Hurwitz, Heller Ehrman, Pennie & Edmonds, Howrey Simon.

What are the commonalities? Betting too much on certain types of work (Testa), growing too fast through lateral acquisitions (Howrey), bad/failed mergers (Coudert Brothers), marginalized business models (Pennie), too much debt (Dewey), etc. Lot's of different things can go wrong, and its hard to see the trouble indicators until its too late.

Even the tippy-top firms have certain issues. Cravath is very heavily leveraged, Skadden has some questionable offices, DPW has high expenses, STB is very invested in private equity, etc. If I had to pick a firm for "safest" I'd probably say S&C: they've got killer revenue per lawyer, extremely low expenses, and a well rounded, diversified practice.

[imchuckbass58]

Anecdotally more volatile:
White & Case, Orrick, O'Melveny(maybe not anymore)

Anecdotally more Stable firms:
Basically the v15, outside of maybe Weil, who I think is still deferring people.

This is basically right. White & Case, Orrick and O'Melveny are the only ones I can think of that have had rumblings (true or not) of serious problems. Clifford Chance's NY office was also rumored to be having some trouble late last year, but I don't think the stability of the firm as a whole is in question.

Among the other firms, there are some that people seem to think have better overall business outlooks, and some that haven't been doing great as of late (but aren't having serious problems).

Off the top of my head, some of the ones in the latter category might include Mayer Brown, Morgan Lewis, Cadwalader, Shearman, Fried Frank, Proskauer, Paul Hastings.

Some firms that are doing especially well: S&C, Wachtell, Quinn, Gibson Dunn.

Pretty much everyone else seems to be somewhere in the middle - business is good but not great.

[imchuckbass58]

Point 1: this thread is retarded for the very reason that no other law firms have the type of debt Dewey does.
Point 2: you're speculating about business of law firms which none of us have any information about since we don't have access to their financials
Point 3: The Anonymous posting in this thread is stupid. Just because you're anonymous doesn't mean you aren't retarded. HTH

1: Dewey's the only law firm I can think of with a bond issue outstanding, but lots of firms have pretty big term loans/revolvers from banks (beyond the normal revolver almost every firm has to deal with month-to-month mismatches between revenue and expenses).

2: We don't have access to their financials, but we do have revenue, PPP and RPL figures, which are pretty informative (assuming they are properly reported), as well as qualitative indicators like layoffs, deferrals, partner departures, and hiring levels.

[Morgan12Oak]

Yeah but there’s virtually no chance a short term credit facility is bringing down a firm. And as far as the other measures go, yeah those financial numbers can be telling, but at the same time half the speculation in this forum is amateur as shit like people posting anonymously throwing around names like Covington and shit that’s not based off anything besides their own incompetent thoughts.

I mean if more speculation was based off of actual numbers or some sort of real information besides what they perceive to be rational thoughts based on their astounding lack of business experience but somehow incredibly high confidence in their business skills then yeah I’d say this is worthwhile. But, with the rampant idiotic anonymous posts being like I heard someone from a defunct firm went to this firm which means this 1000 lawyer firm is going to be defunct bullshit then this shit is just irresponsible.

[imchuckbass58]

But, with the rampant idiotic anonymous posts being like I heard someone from a defunct firm went to this firm which means this 1000 lawyer firm is going to be defunct bullshit then this shit is just irresponsible.

Word.

[Anonymous User]

Anyone have a (admittedly quasi-)educated opinion on the stability / health of Jones Day?

[Anonymous User]

Chadbourne and Parke is having some structural problems (not to mention the fact they may be homeless). They cut their incoming summer class expectation about halfway into the OCI process, meaning many who received callbacks were only considered on a wait-list basis.

[Sup Kid]

Among the other firms, there are some that people seem to think have better overall business outlooks, and some that haven't been doing great as of late (but aren't having serious problems).

Off the top of my head, some of the ones in the latter category might include Mayer Brown, Morgan Lewis, Cadwalader, Shearman, Fried Frank, Proskauer, Paul Hastings.

You have any sources of information about these, or does "off the top of my head" just mean randomly naming big firms that are lower than V20?

[Anonymous User]

Anyone have a (admittedly quasi-)educated opinion on the stability / health of Jones Day?

I would think they are fairly stable. They operate with no debt and have maintained 100% offer rates.

[imchuckbass58]

Among the other firms, there are some that people seem to think have better overall business outlooks, and some that haven't been doing great as of late (but aren't having serious problems).

Off the top of my head, some of the ones in the latter category might include Mayer Brown, Morgan Lewis, Cadwalader, Shearman, Fried Frank, Proskauer, Paul Hastings.

You have any sources of information about these, or does "off the top of my head" just mean randomly naming big firms that are lower than V20?

Most of these firms (Mayer Brown, MLB, Cadwalader, Proskauer, maybe others) conducted announced layoffs and/or no-offered (MLB cancelled its 2010 summer program). I'm not going to pull all the links for you, but each of these took worse than normal hits to revenue, RPL, and/or PPP. Some have also had high-profile partner departures (i.e., Dennis Block, who basically was Cadwalader's entire M&A department), and have/had concentrations in sectors that haven't really recovered (e.g., securitization used to be a huge chunk of Cadwalader's business).

Edit: Here's info on layoffs - http://www.americanlawyer.com/PubArticl ... 2425647706 - there are lots of firms listed, but take a look and sheer numbers and multiple rounds for many of the firms listed above.

[msblaw89]

Point 1: this thread is retarded for the very reason that no other law firms have the type of debt Dewey does.
Point 2: you're speculating about business of law firms which none of us have any information about since we don't have access to their financials
Point 3: The Anonymous posting in this thread is stupid. Just because you're anonymous doesn't mean you aren't retarded. HTH

I understand we are speculating to a degree... I was hoping this thread could shed some insight into firms that are showing "suspicious" behavior( layoffs, decreased bonuses, partners jumping ship etc.) This is obviously not the best example, but take K-Mart, Walmart, and Target. I have no idea what K-Mart's finances are on paper, but through word-of-mouth and store closings, I imagine K-Mart is not in as good of shape as Walmart....since Walmart is hiring and expanding overseas. Target as a company is not as large as Walmart, but I imagine Target is doing well since they made record profits and its products are arguably of higher quality than Walmart.

[Cavalier]

I don't think anyone without inside knowledge can predict, although if the past few years are at all indicative, several more will fail over the next decade. Time will tell...

[Anonymous User]

There is a staggering amount of misinformation on here. There is also a far superior thread on this very topic on xoxo which shouldn't surprise anyone that spends much time on the two sites. I think it's called "Predict the Next Dewey" or something.

My two cents:

1. Someone said that Covington was in the risk category which is crazy for a number of reasons. They are growing their Asia business and are doing very well.

2. Another poster said Mayer Brown is in the risk category. They were just an AmLaw finalist for lit department of the year, posted an 11% increase in profits, are taking laterals and expanded their summer class in every city (Chicago's doubled, for instance). If that's the measure for risk, than every law firm is in serious trouble.

3. Same could be said for OMM. That firm is doing just fine now.

4. As to the strong firms, people rightly pointed to GDC, they are on a tear. They were also a finalist for lit dept of the year and have had huge gains thanks to FCPA work and other litigation boosts.

5. Someone mentioned Skadden. No idea how NYC is doing but Chicago's office is much smaller than it used to be and the word on the street is that their Chicago lit dept is in some trouble. Might say the same about Winston which is reportedly doing some stealthing in Chicago right now.

6. Latham is probably as strong as one could be and still axed 100+ associates at the drop of a hat.

7. Sidley Austin is a firm that should probably be put in the "strong" category. Recent expansion into Houston and Palo Alto, that firm is killing it. Another AmLaw lit finalist which means things.

Bottom line, nobody knows, we are all drawing at straws. The PPP numbers are just as juiced as the law school employment data because there is no oversight whatsoever. Further, not sure why a potential SA should really care about PPP to begin with. The odds of you making partner at the firm you start at grows smaller by the day as everyone is jumping ship at the slightest better offer nowadays. Higher PPP firms may make for downright miserable junior associates.

Plus keep in mind that if PPP is $3m it definitely doesn't mean everyone is making $3m. Aside from the difference between income and equity partners, plenty of service partners are making far less than a firm's average PPP and plenty of rainmakers make more. Performers are compensated accordingly.

[Anonymous User]

Anyone have a (admittedly quasi-)educated opinion on the stability / health of Jones Day?

They were one of the very few firms who weathered the recession with very minimal layoffs (as in they let a few people go, but no mass layoffs like many peer firms), while still hiring 100% of their summers, not deferring summers, and who didn't have to freeze salaries to do it. If they were that strong during the very worst years, I wouldn't worry about them as the economy improves. They essentially brag about how well they weathered the recession, and how good a position they are in right now, so I'd say they are pretty healthy.

[Anonymous User]

Anyone have anything to say about Ropes & Gray, Wilmerhale, or hogan lovells?

[LawIdiot86]

Is a firm's historical recruiting GPA any indication of firm health? If a firm is in a major city paying market and has to dip further into the class than its peers, does that indicate that they are not as healthy as those peers? Dewey had one of the lowest historical median GPAs at my school and the list does seem to be a decent proxy for firm health.