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When Micah Jacobs got a pink slip from Cooley Godward last August, he could have used it as a ticket to depression. But instead of sitting on the couch eating Dove Bars and watching “I Love Lucy” reruns, Jacobs is trying to turn his layoff into an opportunity. Three weeks after he lost his job, he teamed up with a law school buddy and started his own firm — just a stone’s throw from Cooley’s San Francisco office. “One way I looked at the layoff was the bringing to an end a seven-year apprenticeship at large firms,” Jacobs said. “It offered a tremendous opportunity to pursue a dream I’ve always had.” If Jacobs’ dream succeeds, he may be one of the lucky ones. Eighty-six associates got the boot from Cooley in August, and other firms have sent hundreds of lawyers packing either through layoffs or more aggressive performance reviews. “I think a lot of people laid off from Cooley and elsewhere are still looking for jobs,” said recruiter Marty Africa, of Major, Hagen & Africa. “The more junior people are really having trouble.” Africa said she got a call from a Gunderson Dettmer Stough Villeneuve Franklin & Hachigian attorney who was offered a litigation job in a small insurance defense firm in Walnut Creek. “The prospects everyone has at the moment are altered significantly, particularly if they want to stay in the Bay Area,” she said. In Jacobs’ case, he’s helped by the fact that he was a senior litigation associate with seven years of big-firm experience. Cooley has also sent him client referrals, and the economic downturn has made it easier for him to find reasonably priced office space. Still, he likely faces a tough road ahead. Legal consultants say it’s uncommon for associates to go off on their own. They say even for partners, it’s a difficult financial challenge. But given the recession, many companies are looking for firms that offer lower billing rates. So senior associates with significant experience and good contacts may have a chance to go solo. “I rarely hear of associates who go off and start their own firms,” said Gerry Holt, of Holt Consulting Services. “They generally don’t have the marketing or business skills to do it.” But he added that many businesses are not able to pay big-firm fees of $400 to $600 per hour. “That is an opportunity for new or small players,” Holt said. But Donald Oppenheim, a law firm consultant with Altman Weil Inc., warns that the process of starting a firm has become much more complex over the last decade from “the cost of capitalizing a firm to negotiating with the landlord to obtaining malpractice coverage.” GETTING STARTED Jacobs, however, doesn’t seem particularly daunted by the task. He used his three months severance package from Cooley along with his and new partner Eric Ferraro’s savings for seed money to start Jacobs & Ferraro. “I interviewed attorneys in firms and out on their own and everyone said I should be prepared to have one year’s income in the bank,” Jacobs said. “We’re off to a promising start, and it looks like the business is sustainable month to month without the need for a year’s salary.” He also capitalized on the rising vacancy rate to find space in Embarcadero 1. “It’s a good market to find office space, so it was easy to negotiate a license,” he said. Jacobs’ new office is literally across the skyscraper canyon that separates Embarcadero 1 from Cooley’s San Francisco outpost in One Maritime Plaza. He runs into his former colleagues frequently and that close contact has helped him drum up business. “When Micah told me he was going out on his own, I was very pleased,” said Cooley partner Benjamin Riley, who has referred contract work and licensing disputes to Jacobs. “He has the go-getter spirit, the pizzazz, the personality to be out there on his own, to hustle and do well in court.” Hustle and pizzazz, however, didn’t save his job at the firm. Jacobs, 37, joined Cooley from Wilson Sonsini Goodrich & Rosati in March 2000, just before the economy started its downward spiral. And while junior corporate attorneys were particularly vulnerable when firms began laying off lawyers, many recent laterals also received pink slips. In announcing the layoffs in August, Cooley Chairman Stephen Neal said the majority of those cut had been at the firm for less than two years. Recruiter Avis Caravello said most of those laid off appeared to be first- through fourth-year transactional associates. “The senior people I saw get laid off tended to be laterals who had just come into the firm in the last year or so,” she said. Jacobs said he was “surprised and disappointed” when he got the news he was being sacked. “I was getting good feedback from partners.” He said he would attribute a large part of the decision to the fact he was a recent lateral. “I don’t really know what their decision was based on,” Jacobs said. “I was told there were a multitude of factors they used to decide how to spread the layoffs.” As to how other Cooley associates have fared, Jacobs said some are taking time off, while one associate started a catering business and a few have landed at other firms. He said Cooley had helped associates find other jobs and distributed a memo with a list of job openings. CALLING A FRIEND Though he lined up a couple of interviews, Jacobs decided instead to call up Ferraro, who had just left his job at Methven & Associates, a full-service boutique in Berkeley, to go solo. The two became friends their first year at Golden Gate University School of Law. Jacobs transferred to the University of California, Berkeley’s Boalt Hall School of Law for his last two years of school. After graduating in 1994, he returned to his hometown of Los Angeles and joined the now-defunct Troop Steuber Pasich Reddick & Tobey and then jumped to McCutchen, Doyle, Brown & Enersen’s Los Angeles office before joining Wilson in 1998. Among his current cases, Jacobs is handling a contract dispute for a manufacturer of light-emitting devices, an insurance coverage dispute for a group of homeowners, and a misappropriation of trade secrets case. He’s also researching the possibility of filing a large consumer fraud action. Ferraro — who served as outside general counsel for several start-ups and mid-sized companies while with Methven — has brought in clients, including a software company in the midst of a merger, an angel investor providing seed funding for a technology company, and a group that’s launching a business to produce and sponsor musical events. Jacobs’ brother is one of the entrepreneurs in the latter business. Jacobs says working for himself has renewed his passion for the law. “I have more freedom to control some of my own professional development,” he said. “It’s exhilarating to be making calls on litigation and deciding what the strategy will be, the legal theories, coming up with a creative approach to complicated legal problems.” For other laid-off attorneys or even those at firms who are thinking about launching their own practices, Jacobs has one piece of advice: “Don’t let fear prevent you from pursuing your dreams.”

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