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Shrinkage at Day Casebeer Shows IP Litigators No Longer Immune to Recession
The Recorder
February 27, 2009
Even a tiny law firm whose bread is buttered by fattening and relatively recession-proof patent litigation has had to lay off lawyers.
Day Casebeer Madrid & Batchelder, the Cupertino, Calif., firm of high-end IP boutique fame and Qualcomm discovery fiasco infamy, cut seven associates and two staff around election time last fall. As of last summer, the firm had been 38 lawyers strong, so that's a pretty sizable chunk, nearly 20 percent of the firm's lawyers. Today, the firm has 27 lawyers.
So what's the deal with cutting lawyers at a firm that does IP when most every layoff has been blamed on a slowdown in corporate work? Rusty Day, the guy who makes the sun rise at Day Casebeer, explained that there were two causes for the cuts.
"I think the reasons are obvious if you look at what's going on in the economy," Day said this week. "We scaled the firm to reconcile our resources with the demand for our services."
Oh, and also Day said the firm finished up a big ol' patent case for client Amgen against drug company Roche, leaving some associates without much work. "Certainly the successful conclusion of the Roche case meant that we had much less demand for our services. We went from feast to famine."
The layoffs were especially hard to swallow at the small firm, which doesn't have the benefit of being as impersonal and corporate as large law firms. "It was horrible," recalled a former Day Casebeer lawyer who was not among the cuts.
But the former lawyer also said that the firm acted "honorably" in making the cuts.
According to Day, those laid off were given two months' severance and their end-of-the-year bonus, which amounts to about a month's worth of salary.
Some of the associates were able to quickly land jobs at big firms, being much-desired IP litigators and also getting cut before the tsunami of layoffs in the last two months. (None of the first-years, who had just started, were laid off.)
People still wonder about the effect of the Qualcomm discovery debacle on the firm's business. Five Day Casebeer lawyers -- as well as one from Heller Ehrman -- were sanctioned in January 2008, after client Qualcomm failed to turn over crucial documents in a patent fight with Broadcom. Although the sanctions were lifted last year to give the attorneys a chance to tell their side of the story to the court, the final outcome isn't certain.
Two of the associates who were sanctioned left the firm earlier last year, as did one partner, Lee Patch.
Now a second partner who was sanctioned, Christian Mammen, has left the firm. But both Day and Mammen said his departure at the end of last year had nothing to do with Qualcomm. "I'm looking into some other opportunities," Mammen said this week, declining to elaborate on his departure or his future.
Between layoffs and departures, Day's certainly getting shorter on lawyers -- and not just because it's winter.
