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3L, DCNG here. Median Grades. No 2L big firm SA - had an internship at an investment bank in-house.

I am currently in Asia right now. Have an interview with a US/UK firm there coming up next week. A friend of mine also had an interview with them earlier in the year, but was rejected. He said they asked him "what happened at OCI/why do you not have a job?" as well as "did you interview with us at OCI?"
His answer was he did not know, and "no" to whether he interviewed with them. Suffice to say, that's probably not a good answer. But I obviously don't have any better alternatives to "my below median grades were not good enough for 2L OCI and in-house does not make offers to fresh grads." Any suggestions?

Also, I had a screener with this firm in their NY office, but nothing more. Do I say this?

What's wrong with just saying that you wanted to work for an investment bank your 2L summer and make up some bullshit reason (like, "I wanted to see the business side of things before doing corporate law, because I think that really helps being a corporate lawyer by anticipating client needs, etc. etc.")? And then follow up with: Unfortunately, investment banks don't give full time offers as a matter of practice.