Foley & Lardner reports that in 2009 gross revenue declined 8.8 percent to $667 million, and average compensation for all partners fell 7.9 percent to $586,000. "We're glad 2009 is behind us," says firm chairman Ralf-Reinhard Boer. "It was a tough year for the industry and a tough year for us. Things are perking up pretty much."
The pay of partners in the highest tier fell from 18 times to 11 times the pay of partners at the bottom. Boer says at least the top 15 partners voluntarily took a disproportionate hit.
But associates took their lumps, too. Last August, Foley cut salaries 10 percent and announced a wage freeze. In October the firm laid off 39 lawyers, mostly junior associates in corporate, finance or real estate. In February Foley announced that, after their first three years, associates would be paid and promoted based on performance rather than years of service.
Bankruptcy and renewable energy were bright spots last year, Boer says. The corporate and finance groups slowed somewhat less than predicted, while real estate met its low expectations. What really hurt the firm is that its supposedly counter-cyclical practices -- IP and IP litigation, along with securities and white collar litigation -- underperformed.
But Boer says business has revived in virtually every area since December, especially in Foley's core practice of IP and IP litigation. "If demand continues to pick up," he says, "we'll be back in hiring mode soon."
Even in 2009, Foley has at least two numbers to boast about. Boer says Foley's industry-leading collection rate increased to a record 98 percent. "We attribute it to very good relations with clients and very good clients," he says. "They're tough on price but they pay."
Meanwhile, the sum of pro bono hours donated by firm lawyers soared 33 percent to 68,000. Boer credits Edmund Baxa Jr., a member of the management committee who also heads pro bono, for motivating lawyers at every level. "Our hours went up big time and we're pretty proud of that," says Boer. "We'll keep that going even as productivity increases."
This report is part of The Am Law Daily's ongoing Web coverage of 2009 financial results of The Am Law 100/200. Results are preliminary. Final rankings and full results for The Am Law 100 will be published in The American Lawyer's May 2010 issue and on AmericanLawyer.com. The Am Law Second Hundred will be published in the June issue.