Blaming a down economy, Wilson Sonsini Goodrich & Rosati axed 45 lawyers and 68 staff Monday.
The 660-lawyer firm laid off associates and of counsel accounting for 6.5 percent of its attorney work force. About 9 percent of the firm's staff, ranging from secretaries to paralegals, was let go. The firm also said it would be freezing associate salaries for the upcoming year.
"It's economic downsizing," said firm spokeswoman Courtney Dorman. "I think every business has been impacted by the downturn, and we're not exempt from that."
Wilson follows a growing number of Am Law 100 firms that have laid off attorneys. Last week, Silicon Valley rival Cooley Godward Kronish cut 52 lawyers and 62 staff. Corporate and transactional lawyers were hit the hardest at Cooley and the same is true at Wilson Sonsini with "very few" litigation associates let go, according to firm sources.
"The capital markets have been considerably weakened by what's going on, and we're heavily focused on the capital markets," Dorman said.
Most of the cuts were in the firm's Palo Alto, Calif., office, Dorman said, home to most of its lawyers.
Wilson lawyers said the mood was somber Monday. Management had worked on the cuts with practice heads, but some partners first learned the news at a meeting Monday morning and the rest of the firm was notified with a memo. Those being laid-off were told individually.
"People expected something," said one Wilson partner. "There's a sadness, but a sigh of relief that people actually know what's happening now."
Wilson was hit hard by the dot-com bust. The firm shed 168 lawyers, or about a quarter of its total, through attrition and performance-related firings, before acknowledging the need for additional layoffs in August of 2002. The firm was criticized for its so-called "stealth layoffs," which left former associates to seek new jobs after having been labeled poor performers.
Carl Baier, a Silicon Valley legal recruiter, said honesty is best in these situations.
"I think its important to be candid both with the people you're laying off and the community they have to go out into as job seekers," Baier said.
Laid-off attorneys and staff will get 13- to 20-week severance packages depending on seniority.
Wilson Sonsini has yet to report its financial results for 2008 -- the firm's fiscal year closes Jan. 31. Dorman said that the firm will report "a very strong year." The cuts, she said, aren't based on last year's results, but are "all about managing the business for the future."
Now, three of the four biggest Silicon Valley firms have laid off lawyers: Wilson, Cooley and Gunderson Dettmer Stough Villeneuve Franklin & Hachigian. Only Mountain View, Calif.'s Fenwick & West has avoided the chopping block so far. A call to that firm's chairman, Gordon Davidson, was not returned Monday afternoon.
Although Silicon Valley isn't the epicenter of the current economic troubles, Baier said it's starting to feel like the dot-com bust.
"The fear in the air certainly harkens back to 2000-2001," he said.
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