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Fenwick & West Lays Off 15 Associates, 7 Staff
The Recorder
May 06, 2009
Amid the avalanche of attorney layoffs this winter, Fenwick & West stood alone when it let go staff but didn’t cut any of its lawyers.
On Tuesday, management at the 300-lawyer firm changed course, laying off 15 associates and seven more staff.
"The downturn in the economy has been longer and deeper than we hoped," said Fenwick Chairman Gordon Davidson on Tuesday. "We were operating with excess capacity, and we thought it would bounce back sooner."
The cuts, which the firm said account for just under 10 percent of its associate ranks, come in San Francisco and the firm’s Mountain View headquarters. The corporate department took the brunt, though other practices were affected, Davidson said.
Laid-off associates and staff were told individually, and the news was delivered to the whole firm in a voicemail message Tuesday morning. The attorneys are getting four-month severance packages -- in the range of the three to six months being offered by other firms.
Thousands of lawyers and staff have been laid off from big law firms during the recession. Fenwick’s Silicon Valley competitors Wilson Sonsini Goodrich & Rosati and Cooley Godward Kronish made deep cuts to attorneys and staff in January.
But when Fenwick cut 36 staff positions on Jan. 29, Davidson told The Recorder that it didn’t lay off lawyers because of the lessons of the dot-com boom, when the firm doubled its hiring and then was forced to cut associates in 2001. He said that after the dot-com bust, Fenwick pursued a more moderate pace of growth, in part to avoid layoffs in the future.
"It’s better to have moderate growth as opposed to reacting to the twists and turns of the market," Davidson said at the time.
On Tuesday, the Fenwick chairman changed his tune.
"The lesson from the dot-com bust was when the work came back, we had lost a generation of lawyers," he said. "Hopefully we’ve got this one calibrated now."
Davidson reported that business in certain practice areas, like corporate, saw a 10 percent drop from last year. "On average, people aren’t as busy as we’d like them to be."
Carl Baier, a Silicon Valley legal recruiter, said he was surprised when Fenwick didn’t cut lawyers when it laid off staff, given the firm’s large corporate department -- a practice that has been hit hardest by the recession. Still, it’s difficult to predict how the economy will turn. "No matter how good your crystal ball is, this is a difficult environment to get it right," he said. "I do think that we’re nearing the end of significant layoffs."
See which law firms are on The Layoff List.
