This week, Mayer Brown capital markets partner James Tanenbaum resigned after reports surfaced that his former firm, Morrison & Foerster, had conducted an internal investigation into allegations of sexual misconduct against him.
Tanenbaum, who joined Mayer Brown in late February, had only been at the firm for about a week when he resigned.
While the situation puts a spotlight on many underlying issues within Big Law, one immediate concern is the due diligence process a firm conducts when making lateral hires, a matter that also arose last summer following an insider trading case filed against a recent partner recruit.
Lateral partner hiring often operates behind a wall of secrecy, in part due to the competitive nature of the market and client concerns. But with the #MeToo movement bringing allegations of workplace sexual misconduct into public view, questions have now emerged about whether firms are doing enough to ensure that they properly investigate and vet lateral candidates.
The lateral process typically starts with partner prospects completing a questionnaire.
“It’s a very intensive and inclusive document,” said Sharon Mahn, a New York-based legal recruiter.
The document ranges from simple questions like name, address and clients to whether an incoming partner has even been involved in a lawsuit, convicted of a misdemeanor or are behind on their taxes, Mahn said. These questionnaires are completely self-reported by the incoming lateral partner. Then, once they receive authorization, the law firm or their recruiter may call clients to ask about their incoming hire.
But during the process, it’s vital that firms and recruiters alike not breach the confidentiality of the move or violate any laws in place that protect the potential employee. These parameters could limit the scope as to what information can be uncovered about any potential predatory or discriminatory behavior.
“There are local laws that govern what questions you can ask in hiring,” said Zoe Salzman, a litigation partner at Emery Celli Brinckerhoff & Abady in New York.
In New York, for example, employers are prohibited from asking a potential hire about prior salary history or criminal convictions, Salzman said.
While she wasn’t aware of any specific laws that prohibit asking about allegations of sexual harassment in a prior role, issues can arise if there are confidentiality or nondisclosure agreements related to predatory behavior.
“Sometimes resolution of claims comes with confidentiality restrictions and prohibitions on speaking going forward for both the victim and the alleged harasser, and that can limit what someone can disclose in a job interview context,” Salzman said.
A previous employer can find itself in an even trickier position.
“I think all prior employers right now are extremely cautious in the law firm context and beyond about what they say about a prior employee, because [they] are afraid of a defamation suit,” Salzman said.
Frode Jensen III, a former partner at Pillsbury Winthrop Shaw Pittman, famously filed a $45 million suit against the firm for exactly that reason. In 2002, Jensen sought to leave Pillsbury Winthrop for Latham & Watkins, but scrapped the move after his former firm said in a press release that his exit came ”on the heels of sexual harassment allegations” and ”a significant decline in his productivity.”
Law firms face a delicate balancing act between protecting themselves from liability and ensuring that no one is exposed to predatory behavior. As a result, it has become commonplace for employers to confirm dates of employment and job title, but little else beyond that basic information.
“That puts the past employer in a tricky position to the extent they want to signal or warn that they think there are real, troubling issues or concerns with someone’s behavior,” Salzman said.
One potential solution could be to implement a due diligence process akin to what exists across the Atlantic.
In the U.K., law firms will employ a second recruiting firm to conduct their due diligence investigations, separate from those making the initial placement, said Alisa Levin, a principal with legal recruiting firm Greene Levin Snyder. While this does come at an additional cost to the firm, the second recruiter will place calls to partners who have worked with the incoming lateral hire, as well as clients.
The law firms are relying on the second recruiting firm “to make sure that there’s nothing that was in the market that they failed to uncover,” Levin said.
She noted that in the case of Mayer Brown and Tanenbaum, whose previous recruitment by Morrison & Foerster more than a decade ago made waves at that firm, it still remains unclear whether any of the allegations against him would have surfaced on a second check.
Law firms already have a lot on their plate when it comes to lateral hiring, but the latest incident illustrates that firms should perhaps consider taking a closer look at their hiring practices in order to avoid embarrassing headlines and costly mistakes.
“This is just a reminder that lawyers are people too and they have to look at the whole picture,” Levin said.