John Cadwalader
Cadwalader, Wickersham & Taft, the spiritual founding father of our Layoff Tracker (and #5 on the Top Ten list), confirmed to Legal Week that its PEP fell 30%, to $1.88 million from $2.725 million in 2007.
Despite the whopping 131 layoffs known to date, the partners seem to be taking a substantial hit. Admittedly, it’s not the 100% hit laid-off associates are facing, but the average partner took a pay cut of almost $1 million. In fact, the partners shouldered the brunt of the market hit: revenues were down “only” 14%, to $506 million from $587 million.
That’s roughly comparable to Orrick, which we addressed yesterday. Orrick also had layoffs in 2008 and had a revenue increase of 8% but PEP decreased 20%.
According to firm chairman Christopher White (Notre Dame BA ‘73, Michigan JD ‘77 – who does he wrote for in the annual game?), it wasn’t all bad this year:
Cadwalader’s antitrust practice spent part of 2008 representing Microsoft in its battle to take over Yahoo. In litigation, the firm represented fallen investment bank Bear Stearns after its merger with JPMorgan in March. And this month, the firm secured the debtor counsel role on the Chapter 11 proceedings for chemicals maker LyondellBasell.
That wasn’t enough to offset private equity, real-estate finance and “some capital markets.”
Cadwalader had a management shakeup last year and the vote on the new slate, which apparently includes departing bankruptcy partner Bruce Zirinsky, is today.
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Hopefully every major firm understands that profits are going down in 2009 and probably 2010. If they are looking at the next ten years, it could be a great time to steal talent from other firms. If they're looking at 09 profits, they'll dump associates, staff, etc.
Behavior like that assumes the firms think ahead. They certainly haven't behaved in a prospective manner in my experience. I think the majority of BigLaw is just completely reactionary, stumbling from one disaster to the next, slapping on whatever quick fix is the patch du jour.
I told you – Cadwalader is next my friends. There is blood on the street its up to my ankles….word is groups of partners are starting to look outward for safe landing zones. Remember they just brought in a whole slate of partners to jump start their PE group, right before this crisis hit, so now their NY office carries a non-revenue producing expense (redundant, I know)…..blood on the street its up to my knees.
If you're not going to use the fancy background for comments anymore, may I have it?
It seems to be a casualty of the switch to IntenseDebate… tough choice, I get the funky background, or we all get to have threaded comments with a bunch of other nifty features.