Mary Yelenick, a former chair of Chadbourne & Parke’s products liability group who last month sought to join a $100 million gender discrimination case against the firm, has filed a declaration with a federal court in New York detailing her claims and criticizing the firm’s methods of compensating partners.
“Over the past twenty years or so, I have repeatedly and consistently raised gender equity issues—surrounding compensation, promotions, training and advancement opportunities for women, and similar concerns—with the partnership and management of the firm,” said Yelenick in court papers. “However, my complaints have largely been ignored by firm leadership; at best, I have been given lip service, but nothing has really changed.”
Yelenick, who made partner at Chadbourne in 1996 and is now of counsel with the firm in New York after retiring from the partnership late last year, is the second former partner at the firm seeking to become part of a suit filed last August by current litigation partner Kerrie Campbell in Washington, D.C. In October, former Kiev office managing partner Jaroslawa Zelinsky Johnson petitioned a federal court in Manhattan seeking to join Campbell’s case.
In her 16-page filing Monday in support of class certification, Yelenick echoes many of the same allegations made by Campbell and Johnson. Yelenick claims that during her 35 years at Chadbourne she witnessed firsthand how a five-member management committee and the firm’s managing partner—all of whom were men—had an outsized influence in determining partner compensation. (Ayse Yuksel, a woman and managing partner of Chadbourne’s Istanbul office, was elected to the firm’s management committee last summer.)
Partners not on the committee are “effectively shut out of meaningful participation in the firm’s governance,” according to Yelenick, who states that she “noted with interest that the income levels of many members of the management committee rise during their tenure on the committee, even when their client work declines.”
While some parts of Yelenick’s declaration are redacted—plaintiffs in the suit must submit filings to U.S. District Judge J. Paul Oetken, who determines what can be made public—she does identify one former management committee member by name in Marc Alpert, a defendant in the case and a former head of Chadbourne’s public companies practice.
In June 2016, as Alpert prepared to leave the firm to become general counsel at New York-based conglomerate Loews Corp., he chose two male partners to inherit some important clients, according to Yelenick’s declaration. The names of the two partners and clients are redacted in her filing, as are two female partners who she alleges also did significant work for those clients, but were not designated by Alpert as his “origination-credit successor.”
As a result, Yelenick claims that the two unnamed male partners at Chadbourne will see their compensation rise in future years. Their female counterparts at the firm, which is poised to combine with global legal giant Norton Rose Fulbright, will not be as fortunate.
“These men did nothing to merit this result,” Yelenick said in court papers. “They were simply the designated favorites of a retiring male partner who had himself inherited origination status from other men. The cycle continues.”
Yelenick alleges that Chadbourne’s “origination inheritance” system routinely allows male partners at the firm to bequeath business to whomever they wish, usually “favored male successors,” even if there is a female partner with “substantial involvement in the matter and a long working relationship with the client.”
This process helps male partners take credit for the most profitable clients and earn compensation in excess of their female counterparts, according to Yelenick, a scenario that she claims to have both observed and experienced herself during her more than three decades at Chadbourne. The inheritance system, she said, perpetuates the cycle of gender disparity.
“Origination credit for the same case may be passed down multiple times in perpetuity,” states Yelenick, describing something akin to an old boys’ network. “Historically at Chadbourne, primary responsibility for large institutional clients was vested with male partners.”
Yelenick claims that despite bringing in new clients and generating millions in revenue for the firm during the past three years, she was never awarded more than 525 points, a number that put her in the lower tier of the partnership compensation matrix. (Sibling publication Law.com, citing a survey by legal recruiting firm Major, Lindsey & Africa, examined last year how origination credits are often to blame for lower female partner pay at large firms.)
In some years, the points that determined Yelenick’s partnership draw were reduced, despite her strong performance. Even after collecting $1.25 million for Chadbourne in 2014, Yelenick said she received a reduction in points.
Chadbourne, which before its recent deal with Norton Rose Fulbright has entertained other suitors in recent years, has watched its head count and gross revenue slip between 2012 and 2015. The firm did see profits per partner and revenue per lawyer rise in 2015, to $1.135 million and $785,000, respectively.
In a statement provided to The American Lawyer by a firm spokesman, Chadbourne said Yelenick’s declaration contained many inaccuracies and overstated her contributions in origination client relationships.
“Ms. Yelenick received shared billing and/or responsible credit for client relationships that other partners and attorneys, in near entirety, won and developed without her involvement,” the firm said. “Despite having been with the firm for many years, Ms. Yelenick completely distorts the facts surrounding how client relationships are shared and transitioned. She reaped the rewards of the firm’s process in the years when she was among the more highly compensated partners in the firm, and in other years, her compensation reflected less significant contributions. But in every year, her compensation always reflected her contributions, and never her gender.”
In her declaration, Yelenick said that her clients over the years have included luxury cosmetics company Clarins, whiskey producer Jim Beam Brands Co., electronics giant LG Corp., appliance maker Miele and drug manufacturer Purdue Pharma LP. Yelenick represented the latter—long known as one of Chadbourne’s largest clients and closely linked to Chadbourne management committee member Lawrence Rosenberg, a tax expert who advises the company’s wealthy Sackler family—in litigation over its popular painkilling drug OxyContin. (Rosenberg is one of six Chadbourne partners named as defendants in Campbell’s suit.)
In its statement, Chadbourne said the “cause of gender equality is not advanced by erroneous, self-serving and baseless allegations used to support a lawsuit that seeks unjust economic reward for decisions made on the merits, having nothing to do with gender.” Boston-based Lexington Insurance Co., a unit of American International Group Inc., is Chadbourne’s insurance carrier in the litigation. Proskauer Rose is representing Chadbourne in the case.
Yelenick, who has written about societal issues, maintained in her declaration that she tried to spur the firm’s management committee to change Chadbourne’s origination credit system, but was ultimately unsuccessful. In the end, she concluded that only a formal legal action would bring about change at the firm.
“I have repeatedly witnessed female senior associates passed over for promotion to the partnership in favor of less qualified and less experienced male associates,” Yelenick said in her filing. “My own promotion to partner was delayed for years as I watched men with less experience and less potential for business development be promoted before me. I know of numerous female associates and partners who have left the firm because they were deeply dissatisfied with what they viewed as a lack of promotional opportunities and fair compensation for women.”
The American Lawyer previously reached out to a dozen former female Chadbourne partners to discuss the claims levied by Campbell and Johnson. Two of those ex-partners, who requested anonymity in order to speak freely, said that allegations of bias had some merit. A third said she saw no evidence of gender discrimination, but admitted that origination credits were an issue at the firm.
In January, Margarita Oliva Sainz de Aja, a former project finance partner with Chadbourne’s international arm, told sibling publication the New York Law Journal ahead of her departure for Baker McKenzie that she enjoyed her time at the firm. Nonetheless, Oliva was well aware of the challenges women face in Big Law.
“In general, women are paid less than men,” Oliva said. “It doesn’t come easy, you have to fight for your salary and fight for your bonus.”