Do Not Lateral to Baker Botts

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favabeansoup

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Re: Do Not Lateral to Baker Botts

Postby favabeansoup » Tue May 02, 2017 2:43 am

Anonymous User wrote:Anyone have thoughts about whether Latham or Skadden will really go to Dallas? That would shake up BB and VE as well - there's not much else established up there.


Everything Latham might do in Dallas they can manage from Houston, wouldn't make financial sense imo to open an office there. Highly doubt Skadden will try breaking in. There's enough competition already from everyone else in that tier. At this point Texas will be a very expensive market for them to break into. See above problems with Gibson/Kirkland, you gotta drop serious, serious cash to attract people to a known sweatshop name like that.

kykiske

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Re: Do Not Lateral to Baker Botts

Postby kykiske » Tue May 02, 2017 12:38 pm

What has been going on lately? I'm seeing more and more posts about layoffs and/or terminations. Is there something going on in the legal market?

Npret

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Re: Do Not Lateral to Baker Botts

Postby Npret » Tue May 02, 2017 12:43 pm

kykiske wrote:What has been going on lately? I'm seeing more and more posts about layoffs and/or terminations. Is there something going on in the legal market?

I think people are more open to posting about losing their job. I don't think it's a change.

I mean government hiring seems screwed but not so much firms.

kykiske

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Re: Do Not Lateral to Baker Botts

Postby kykiske » Tue May 02, 2017 2:12 pm

Npret wrote:
kykiske wrote:What has been going on lately? I'm seeing more and more posts about layoffs and/or terminations. Is there something going on in the legal market?

I think people are more open to posting about losing their job. I don't think it's a change.

I mean government hiring seems screwed but not so much firms.


To be honest, in law school I was convinced that being in big law was the pathway to financial prosperity and happiness. And that all associates made partner, etc. Further, anyone who was fired was because they simply were bad at his or her job.

I now know just how wrong I was.

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Johann

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Re: Do Not Lateral to Baker Botts

Postby Johann » Tue May 02, 2017 2:44 pm

kykiske wrote:What has been going on lately? I'm seeing more and more posts about layoffs and/or terminations. Is there something going on in the legal market?


I've discussed with a lot of midlevels anecdotally scattered across the V100 but haven't studied the latest amlaw financials yet.

It's a combination of the following:
A) firms really ramped up hiring from 2011-2015 because they had work to be done sitting on the table that wasn't being done. In a billable hour format, you only make as much as you bill. If you've got the work but don't have the associates to bill the work, you're leaving untapped billables on the table. So you ramp up fast without too much foresight into the future in order to make money. When that work finally slows down, you've got idle hands.
B) Idle hands were exacerbated by the salary increases (increasing fixed costs) as well as less firms laying off from 2011-2015 because midlevel and senior associates were a hot commodity since many were fired as juniors in the Great Recession and never started a biglaw career. Now, the equilibrium has returned without forcing people out or a relaxed up and out and there are too many senior associates and midlevels for the amount of work that has tapered off.
C) oil is still imploding; political uncertainty and economic uncertainty in world markets right now make some companies reluctant to do big reorgs (plenty of work is still there, but some work is drying up or plateuing compared to gangbusters)
D) generally, this is what happens in a partnership model where partners suck out all the profits (which they should). There is nothing left for bad times or even leveled off times. If your business isn't growing at 7%+ every year, it will be problematic/hard to retain top level partners and keep them from leaving to the top NYC growing firms.

Jchance

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Re: Do Not Lateral to Baker Botts

Postby Jchance » Tue May 02, 2017 3:14 pm

^
Are you saying that now (and in the near future) is a bad time to be a mid-level and senior associates? Is the lateral market no longer hot?

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Re: Do Not Lateral to Baker Botts

Postby Anonymous User » Tue May 02, 2017 3:18 pm

I think most of "layoff" posts on tls recently have been about juniors not mid lvls. Nobody is immune to layoffs period.

Right2BearArms

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Re: Do Not Lateral to Baker Botts

Postby Right2BearArms » Tue May 02, 2017 9:26 pm

favabeansoup wrote:
Anonymous User wrote:Anyone have thoughts about whether Latham or Skadden will really go to Dallas? That would shake up BB and VE as well - there's not much else established up there.


Everything Latham might do in Dallas they can manage from Houston, wouldn't make financial sense imo to open an office there. Highly doubt Skadden will try breaking in. There's enough competition already from everyone else in that tier. At this point Texas will be a very expensive market for them to break into. See above problems with Gibson/Kirkland, you gotta drop serious, serious cash to attract people to a known sweatshop name like that.


Agree with this, 0% chance Latham opens an office in Dallas. Skadden may, but it will stay small, just as their Houston office is. Skadden is really a non-player in Houston. Their office has been open since the early-mid 1990's and has never made an impact. It appears that Simpson is following that trend as it doesn't seem to be growing.

It will be interesting to see what Gibson does to the Houston market, but they face an uphill battle to make a major mark. V&E, Latham & Kirkland will continue to dominate the space with Akin making a push. No idea what is up with Baker Botts, but I have not seen them across from us or even involved in a deal for the better part of the last 6 months (admittedly I work in a less general area, but we deal with general corporate and finance issues/teams a lot). I don't do cap markets, but I do not think Baker Botts has been on any of the recent energy IPOs which have launched out of Houston either.

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Re: Do Not Lateral to Baker Botts

Postby Anonymous User » Wed May 03, 2017 12:43 am

Right2BearArms wrote:
favabeansoup wrote:
Anonymous User wrote:Anyone have thoughts about whether Latham or Skadden will really go to Dallas? That would shake up BB and VE as well - there's not much else established up there.


Everything Latham might do in Dallas they can manage from Houston, wouldn't make financial sense imo to open an office there. Highly doubt Skadden will try breaking in. There's enough competition already from everyone else in that tier. At this point Texas will be a very expensive market for them to break into. See above problems with Gibson/Kirkland, you gotta drop serious, serious cash to attract people to a known sweatshop name like that.


Agree with this, 0% chance Latham opens an office in Dallas. Skadden may, but it will stay small, just as their Houston office is. Skadden is really a non-player in Houston. Their office has been open since the early-mid 1990's and has never made an impact. It appears that Simpson is following that trend as it doesn't seem to be growing.

It will be interesting to see what Gibson does to the Houston market, but they face an uphill battle to make a major mark. V&E, Latham & Kirkland will continue to dominate the space with Akin making a push. No idea what is up with Baker Botts, but I have not seen them across from us or even involved in a deal for the better part of the last 6 months (admittedly I work in a less general area, but we deal with general corporate and finance issues/teams a lot). I don't do cap markets, but I do not think Baker Botts has been on any of the recent energy IPOs which have launched out of Houston either.

I've was told the bolded directly by a former OMP at LW. Latham evaluated Houston for 10-15 years before breaking into the market. They do a deep-dive into the costs to enter the market, the amount of work that can bear out their rates, etc. Houston has a ton of CapM/IPO work (and LW Houston does more UW-side work than issuer rep due to its relationships with the banks) and premium energy M&A work. Dallas doesn't have the same volume, and even if it does continue to expand, a lot of the work could easily be done out of Houston.

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rpupkin

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Re: Do Not Lateral to Baker Botts

Postby rpupkin » Wed May 03, 2017 12:50 am

Anonymous User wrote:I've was told the bolded directly by a former OMP at LW. Latham evaluated Houston for 10-15 years before breaking into the market. They do a deep-dive into the costs to enter the market, the amount of work that can bear out their rates, etc. and the optimal point when to lay off most of their junior associates.

Edited for completeness.

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Mickfromgm

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Re: Do Not Lateral to Baker Botts

Postby Mickfromgm » Wed May 03, 2017 12:36 pm

LondonCallingV10 wrote:I would question whether every law firm lays off laterals first. In my experience (having sadly seen layoffs in more than one firm) the smarter, better-managed firms decide on competency and future usefulness i.e. Smart laterals will survive over mediocre homegrown talent. But of course not all law firms are well managed.....


I, too, have trouble believing that a large firm lays off based solely on a last-in-first-out basis. That would make absolutely no sense. I could see a firm giving "preference" to the less experienced attorneys (or more experienced attorneys) for a variety of reasons, not to mention productivity reasons, but laying off the laterals across all classes first is rather confounding to me.

However, I am not questioning OP's account. I obviously don't know what transpired at BB. My only point is that such a layoff methodology would be highly unusual elsewhere in case anyone is wondering. Peace and love.

gaddockteeg

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Re: Do Not Lateral to Baker Botts

Postby gaddockteeg » Wed May 03, 2017 1:47 pm

rpupkin wrote:
Anonymous User wrote:I've was told the bolded directly by a former OMP at LW. Latham evaluated Houston for 10-15 years before breaking into the market. They do a deep-dive into the costs to enter the market, the amount of work that can bear out their rates, etc. and the optimal point when to lay off most of their junior associates.

Edited for completeness.

:D



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