Alan Feuer of the New York Times wrote a glowing piece about Law Shucks, in which he also mentioned some stuff about White & Case.
Bookending his decription of Law Shucks as “macabre, but wildly popular,” he used the 108-year old megafirm as an exemplar of the troubles facing the top end of the legal industry.
More on the firm and what it signifies for the rest of the market, after the jump.
Feuer is short BigLaw.
While the legal industry is hardly battling the existential threat that is facing, say, the newspaper trade, Big Law — especially in competitive New York — is facing a potential paradigm shift as fundamental as the one that has hit investment banks and the auto industry. Big, as a business model (let alone as an expression of the national mood), seems bound for obsolescence.
The Hildebrandt index found, for example, that at the nation’s 20 top-grossing law firms — 12 of which are in New York — average profit per partner and revenue per lawyer both dropped in the first quarter of 2009, for the first time since 1991.
At W&C, that meant a 6% drop in PPP from $1.7 million to $1.6. But the firm is also on top of the “big three” of law firm layoff rankings (most layoffs total, most attorneys laid off, most staff laid off).
Chairman Hugh Verrier (pictured) described the layoffs as “gutwrenching,” “very painful,” and “hurtful.” But he doesn’t think he was faced with much of a choice:
Mr. Verrier said he saw the storm approaching shortly after he took control in 2007, and considered three options, in consultation with a group of core partners: Do nothing, which risked the firm’s survival; couch layoffs as decisions based on poor performance; or own up to the crisis and bid large numbers of lawyers a harsh but needed goodbye.
His choice to confront the situation directly, while lauded by many on the staff, carried the risk of seeming weak, of becoming the poster child for the industry’s demise. But he saw it as opening a window for White & Case to eventually reposition itself.
“Sometimes it was people who had recently joined the firm, but sometimes it was much-more-senior people at what seemed to be a natural break in their careers,” Mr. Verrier said of those who were let go.
“There were tough judgment calls,” he admitted, adding that he tried as best he could to preserve the firm’s culture and that the “how” of the dismissals, at least in his mind, was as important as the “why.”
We’ve got issues with other choices Verrier has made, but he got this one right: no one believes mass layoffs in this economy are “performance based.” And despite what he says later about collegiality, if nothing else, the laid-off attorneys at least deserve to be treated with the professionalism and respect implicit in a layoff that is attributed to market factors.
Ultimately, Verrier laments the death of the partnership, but it’s not clear whether it’s a symptom or a cause of the straits in which his firm found itself.
“When you finally make the partnership, you can walk into a room and certain assumptions travel with you: This is someone who knows what they are doing, who has intelligence and authority,” the partner said. “While that’s still basically the case, it was a much more collegial place when I first got to the firm. Now it’s colder.
“The loyalty of the institution to its people, and vice versa, isn’t really there anymore — it’s a different animal from what a lot of us were used to. It’s much more of a business now and less of a true partnership. The problem is we’re supposed to all be in this together. But at some point, you stop and think: ‘Well, maybe we’re not.’ ”
That’s the far more-interesting question at this point: what happened to the collegiality?
But don’t let yourself get distracted. The article is really all about Law Shucks.
