Are Biglaw Associates Billing Themselves to the Brink of Exhaustion for Subpar Bonuses?

“It’s been almost one week since Baker McKenzie unexpectedly kicked off Biglaw’s 2020 bonus season, and the announcement has been met with crickets. To be honest, no one thought Baker of all firms would be the one to make the first move, and based on associates’ responses to our annual bonus and billable hours survey, no one really thought this year’s bonus scale would be announced as early as it was due to the ongoing pandemic. Thirty-four percent of our respondents think a big bonus announcement will drop sometime this week, while 33 percent think it will come next week. As a reminder, last year, bonuses were announced on November 7, and the year before that, bonuses were announced just before Thanksgiving, in the second to last week of November,” reports Staci Zaretsky in Above the Law’s Biglaw.

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Biglaw Firm That Cut Associate Compensation By Up To 50 Percent To Reinstate Full Salaries

“Schiff Hardin, a firm that brought in $186,437,000 gross revenue in 2019, ranking 158th on the Am Law 200. If you recall, back in April, the firm instituted some of the largest associate pay cuts we’d heard about during the coronavirus crisis. While the majority of attorneys saw a 15 percent compensation cut, certain practice areas took an astonishing 50 percent hit. Staff making $100,000+ were also subject to up to a 15 percent cut, and the firm also laid off some staff members,” reports Staci Zaretsky in Above the Law’s Biglaw.

“After months of suffering, all of this bad news is finally coming to and end.”

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Biglaw Firm Restores All Partner Pay After 5 Months of COVID Cuts

“Another day, another Biglaw firm that’s reversing its COVID-19 austerity measures,” reports Staci Zaretsky in Above the Law’s Biglaw.

“This time, the good news is coming from Taft Law (formerly known as Taft Stettinius & Hollister). If you recall, back in April, the firm decided to reduce partner draws by 25 percent, leaving compensation for staff, associates, and of counsel attorneys intact. At the same time, the firm laid off 1.4 percent of its attorneys and 3.5 percent of its staff. We’ve been told that the firm’s partners received a treat for Halloween instead of a trick, because all of their pay was restored in full in October.”

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Greenberg Traurig Offers Voluntary Buyouts With ‘Enhanced’ Severance

“For the past seven months, the coronavirus crisis has ravaged the legal profession, leading to salary cuts, furloughs, and in some cases, layoffs. But some firms seem to have remained completely unscathed by the global economic turmoil that’s been caused by COVID-19,” writes Staci Zaretsky in Above The Law’s Biglaw.

“Take Greenberg Traurig, a firm that brought in $1,641,790,000 in gross revenue last year, earning it 14th place in the latest Am Law 100 ranking, for example. Back in April, we reported that the firm had offered “a good deal of transparency about [its] financial position” and assured attorneys that there would be no layoffs. At that time, there had been no word of salary cuts at the firm, and to our knowledge, throughout the pandemic, no such cuts were made. The firm made it quite far without having to take any major cost-cutting measures, but sources have told us that GT has now decided to roll out a voluntary separation program for full-time staff.”

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Biglaw Firm Resolves Pay Bias Claim Over Bonuses Paid at Predecessor Firm

“After a routine compliance review by the U.S. Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP), Locke Lord LLP – a federal contractor formerly known as Edwards Wildman – voluntarily entered into a conciliation agreement to resolve allegations of pay discrimination at its Providence, Rhode Island, office,” released the U.S. Department of Labor’s News Releases.

“In January 2015, Locke Lord LLP acquired Edwards Wildman. In fiscal years 2016 through 2020, Locke Lord LLP received payments totaling $4,915,638 due to federal contracts.”

“After a routine compliance evaluation, OFCCP alleged that Locke Lord LLP discriminated in its practice of issuing bonuses to 22 female associates. While not admitting the allegations, Locke Lord LLP agreed to provide relief for the affected associates totaling $150,000 in lost bonuses and interest, as well as assuring that all employees are afforded equal employment opportunities.”

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More Big Law Pay Moves as Orrick Reverses Cuts, Weil Rewards Earners

“Good news continues to trickle in for associates who’ve hitched themselves to the right law firms or practices, as more firms either end pandemic pay cuts or pile special bonuses on top of lawyers’ regular earnings,” reports David Thomas in Thomas Reuters Westlaw Today.

“In the case of Orrick, Herrington & Sutcliffe, starting Oct. 1 the firm is completely scrapping pay cuts it enacted earlier for associates, of counsel and staff.”

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The Global 100: The Richest Law Firms in the World (2020)

Law.com recently published its latest edition of the Global 100, a ranking of the world’s 100 largest law firms by total revenue,” reports Staci Zaretsky in Above the Law’s Biglaw.

“Overall, the Global 100’s gross revenue grew by 4.7 percent, bringing the collective earnings of these firms up to $119.6 billion. Of course, this is nowhere near the heights reached in 2018, when gross revenue for the Global 100 increased by 8.1 percent, but when Biglaw is up by $5.4 billion, there’s not much room for complaints. The United States continues to dominate the list, and this time around, 50 firms had more than $1 billion in revenue — and the vast majority of those firms are based in the U.S.”

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Former District Attorney Represents Some He Once Prosecuted

“A former district attorney in Mississippi’s largest county is now representing some people he once prosecuted, court documents show,” reports Beaumont Enterprise’s News.

“Robert Shuler Smith did not seek reelection last year in Hinds County. He told WLBT-TV that he sees no conflict of interest. But the current district attorney, Jody Owens, is seeking to have Smith removed from one case.”

“Smith represents Prince Johnson, who was indicted by Hinds County grand jury in 2017 on eight counts of prescription fraud.”

“Owens recently filed a motion seeking to disqualify Smith from the Johnson case, saying state law and Mississippi Ethics Commission opinions show Smith should not represent people he once tried.”

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Biglaw Firm is Punishing 5 Departing Partners in Bonus Clawback Dispute, Petition Says

“Five former Nixon Peabody partners allege that their former law firm tried to punish them for jumping to DLA Piper by trying to claw back bonuses and withholding money in support of the effort,” summarizes Debra Cassens Weiss in ABA Journal’s Law Firms.

“Their mediation petition, filed Tuesday in New York state court, claims that Nixon Peabody’s bonus clawback provision restricts partners from practicing law where they choose. As a result, the provision is unenforceable under New York law, the petition says.”

“The partners resigned from Nixon Peabody in June 2019, the same month their bonuses for fiscal year 2018 were paid in full, the petition says. The partners each were awarded a bonus of $100,000 or more for fiscal year 2018, which ended Jan. 31, 2019. Nixon Peabody did not allow the partners to begin work at their new firm until July 16, 2019, according to the petition.”

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Biglaw Firm Switches From Strict Lockstep Compensation for Partners to Modified System

“Davis Polk & Wardwell is changing to a more flexible compensation system, allowing it to pay more money to retain and attract rainmaking partners,” reports Debra Cassens Weiss in ABA Journal’s Daily News.

“Davis Polk has paid partners based on seniority under a lockstep compensation model. The law firm is changing to a modified lockstep system.”

“Only a few elite New York firms retain a strict lockstep pay structure, according to Bloomberg Law. Other firms that have used a lockstep system include Cravath Swaine & Moore, Cleary Gottlieb Steen & Hamilton, and Debevoise & Plimpton. Those firms typically were most profitable, enabling high partner compensation.”

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Woman Arrested at Boston Airport, Suspected of Running Unlawful Law Practice in Uptown Dallas

“A 32-year-old woman suspected since July of running an unlawful law practice in Uptown Dallas has been arrested in Boston, and police are asking anyone who may have been victimized to speak up,” reports Marc Ramirez in The Dallas Morning News’ Crime.

“Massachusetts state police detained Camilia Shene Johnson at Logan International Airport on Sept. 5 as she tried to board a flight to Istanbul, Turkey. Johnson, a convicted felon, also goes by the name Camilia Johnson Ibrahim.”

“Authorities had been looking into Johnson’s conduct since mid-July, when a skeptical DeSoto resident alerted police to say that a number of legal actions being proposed to them by the suspect were in fact not the law.”

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Lawyer Who Allegedly Lied About Health for Deadline Extensions Should be Suspended

“An Illinois lawyer, who reportedly lied and said he had cancer—when he did not—and instead was looking for discovery deadline extensions, is facing potential suspension from the practice of law. He also allegedly lied about having cancer on his University of Chicago Law School application,” reports Stephanie Francis Ward in ABA Journal’s News.

“In 2015, Vincenzo Field reportedly asked an assistant U.S. attorney in the Northern District of Illinois for additional discovery time because he would be out of the office for four months.”

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Trustee Looks to Question Former Leclairryan Insiders in Bankruptcy Case

“The trustee overseeing the bankruptcy liquidation of Richmond law firm LeClairRyan is starting to dig a little deeper,” reports Michael Schwartz in Richmond Bizsense.

“Lynn Tavenner, who has led the hunt for assets for creditors since the once mighty firm collapsed last year, will question and gather information from a lengthy list of LeClairRyan’s former attorneys, management and others it did business with over the years.”

“Tavenner sought and received court approval last month to begin the so-called 2004 examination process, which would give her the ability to push for the turning over of documents and conducting of depositions, including via subpoena if necessary.”

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Layoffs Hit Furloughed Staffers at Two Biglaw Firms, Lawyers and Staffers at Another

“Baker McKenzie is laying off 6% of its workforce in the United States, Canada and Mexico. Those laid off include lawyers, other timekeepers and business professionals,” reports Debra Cassens Weiss in ABA Journal’s News.

“Davis Wright is laying off 39 staff members who had been furloughed. The staff members were in office services, legal assistance and other administrative positions.”

“Venable is laying off some furloughed employees, as well as some other professional staff members. The firm did not disclose numbers.”

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Overbilling Suit Alleges K&L Gates Used These Techniques to Increase Fees

“An overbilling lawsuit filed against K&L Gates on Monday alleges the law firm used multiple techniques to increase its fees fraudulently while representing a company in a suit over a failed lease agreement,” reports Debra Cassens Weiss in ABA Journal’s  News.

“The Aug. 24 suit, filed in the District of Utah’s Central Division, says K&L Gates billed $1.6 million in legal fees between May 2016 and October 2016, even though it was not hired to be the primary law firm in the representation.”

“The suit was filed by Chicora Life Center and its owner, Chicora Garden Holdings. Chicora Life Center’s manager is lawyer and developer Douglas Durbano, who announced a congressional run in January but failed to get on the primary ballot, the Deseret News reported in May.”

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Tips for Virtual Negotiations

“Social distancing and stay-at-home measures enacted in the wake of COVID-19 have forced many businesses to significantly change the way they operate and communicate. Nowhere is this change more noticeable than in the world of negotiations, which have moved almost entirely to digital platforms,” discusses a post in Davis Wright Tremaine’s Corporate and Business Transactions Blog.

“Businesses that are quick to adjust and adapt have an advantage over those which lag behind.”

This post provides “some tips on how to effectively conduct virtual negotiations—where communications involve the ability to hear and see (at least a headshot of) the other parties.”

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Billion-Dollar Am Law 50 Firm Walks Back Its COVID-19 Salary Reductions

“The latest firm to roll back salary reductions is K&L Gates, another member of the billion-dollar club that placed 39th in the Am Law 100, with $1,026,626,000 in 2019 gross revenue. Back in April, the firm reduced salaries across the board, with equity partners seeing a 20 percent reduction in scheduled advances, and firm leaders taking even larger reductions. Income partners, associates, and allied professionals and staff were subject to a 15 percent reduction in their salary provided their income didn’t fall below a $75,000 floor (with some regional variations),” reports Staci Zaretsky in Above the Law’s Biglaw.

“Now, because the firm has ‘performed better than expected’ in 2020, those reductions are being reduced.”

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Attorney Fieger Sued for Discriminating Against Mother of Sick Child

“Attorney Geoffrey Fieger, one of Michigan’s most prominent lawyers, refused to let one of his employees work from home to care for her sick child during the coronavirus pandemic, according to a new lawsuit,” reports Tresa Baldas in Detroit Free Press.

“The woman says human resources approved her request to work remotely for two days, and, that she offered to take unpaid leave if necessary because her son was ill.”

“But Fieger — who for years has worked from his luxury Caribbean hotel that he has long referred to as home — wouldn’t budge. He fired her instead, she says, so she sued the legal giant in federal court.”

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Former Reed Smith Lawyer Sues Law Firm for Alleged Discrimination After Receiving Concussion

“A lawsuit has accused Reed Smith of wrongly firing a lawyer after a ‘discriminatory chain of perceptions and events’ stemming from a concussion that the lawyer received while on vacation,” reports Debra Cassens Weiss in ABA Journal’s News.

“The lawsuit by former of counsel Aaron Chase, filed Wednesday in the Southern District of New York, alleges unlawful retaliation and disability discrimination by Reed Smith.”

“Chase says he received the concussion when he hit his head hard on the frame of a vehicle that he was entering while on vacation in September 2019. He returned to work the same month and informed his direct supervisor, partner Jennifer Achilles, about the injury soon afterward.”

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BigLaw Firm Sued Over $3M Wire Transfer to Fraudster’s Account

“Holland & Knight is facing a lawsuit alleging that it failed to prevent the transfer of more than $3 million to a fraudster’s account in Hong Kong,” reports Debra Cassens Weiss in ABA Journal’s News.

“The lawsuit, filed in June in Utah state court, was removed to federal court this week, the American Lawyer reports.”

Holland & Knight is accused of failing to investigate after the fraudster intercepted emails regarding a stock sale, posed as the seller, and instructed the law firm to wire $3.1 million from the stock buyer to another account. The new fraudulent account was identified as Wemakos Furniture Co. Limited.”

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