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Reed Smith has laid off five associates in the corporate department — two of whom are based in Philadelphia — due to minimal growth in that practice area, according to firm chairman Gregory Jordan. “We have asked a couple of associates in Philadelphia to move on,” Jordan said during an interview Wednesday. “We certainly, like most law firms, are dealing with what is a little bit of a downturn in some practice areas and a significant upturn in other areas. And our focus in this instance was more in the corporate area � compared to other firms it is doing very well. But it is not booming the way our bankruptcy and litigation departments are. We tend to focus on the areas practice by practice.” Despite a lack of significant growth in the corporate and securities department, Pittsburgh-based Reed Smith has still been actively recruiting and hiring large numbers of new attorneys, and Jordan said a small number of layoffs is nothing out of the ordinary during an economic downturn. “We have an ongoing [hiring] process throughout the year,” Jordan said. “We’ve hired something like 100 lawyers, naturally some people move on, and we’re also, of course, in this environment, and our capacity in any given city or practice area is that people will want to move on.” The two associates, ultimately, did not move to another department within Reed Smith, but Jordan said it is the firm’s policy to consider such an alternative in cases like this. “We always look at those things [moving people to other departments], and I am not sure about the details, but I am sure those things were considered,” Jordan said. “We always are pretty good to move people with the right skill sets into other places. [I'm] not sure specifically in this instance, but our process is to make sure that option is considered.” One source familiar with the situation confirmed that Reed Smith was one of many local firms to engage in “limited, quiet reductions in force.” “I haven’t done a scientific study on this, but I’d be surprised if most [large] firms haven’t done the same thing over the past nine months,” the source said. “[The legal community] keeps getting pummeled with bad news. I think this [economic] downturn has gone on longer than most people thought it would. You have a lot of people sitting around without work to do, especially in that practice area. So I’m not surprised this is happening. I don’t think it’s a big deal.” Following the tragic events of Sept. 11, the economic downturn began to spiral even more out of control, forcing some firms to lay off associates. Philadelphia-based Morgan Lewis & Bockius, which flourished during the dot-com boom of the late 1990s, laid off 50 associates firmwide last October — eight of whom were from Philadelphia. That came several months after a culling effort that ended in another nine departures for performance reasons. Earlier this year, Philadelphia’s Montgomery, McCracken, Walker & Rhoads was forced to lay off three labor and employment associates, as well as several support staffers following a number of labor department departures from the firm, which included 10 partners and four associates. While Morgan Lewis and Montgomery McCracken made headlines with their announced layoffs, sources familiar with the industry say other firms has been quietly laying off or culling associates. But Reed Smith maintains that its crop of new summer associates — 15 in Philadelphia alone — will not be affected by this most recent instance. “We don’t have any concern that we won’t be able to accommodate anyone we would like to hire from the summer program — clerkships and all that is being sorted out,” Jordan said. “We’re very comfortable we will be able to accommodate people next fall, not to say we will give offers to everyone, but we’re not concerned at all that we will be limited in the number of people we should take.” Jeff Blumenthal contributed to this article.

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