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Recruiting the country’s top talent can be competitive enough among even the most esteemed of law firms looking to fill entry-level and lateral slots. But for firms that find themselves defending their reputations after bad news hits, wooing sharp lawyers can be an onerous, yet crucial, task for their survival. When a public relations imbroglio arises, keeping a brave face is critical to stopping the momentum that unfavorable headlines can create. Whether the damage comes from a firm’s own wrongdoing, from the loss of a major client or the departure of key players, once its community gets wind of the troubles, the problems can compound themselves as other clients and partners start eyeing the exits. But while maintaining client and partner loyalty is a big part of damage control, firms also face tough challenges in convincing potential hires that their shop is still shipshape. Several law firms have experienced their share of unflattering news recently. Sidley Austin Brown & Wood’s letters approving tax shelters later challenged by the Internal Revenue Service — and the lawsuits that ensued — have received much ink, as has an age discrimination suit brought against the firm by former partners. Jenkens & Gilchrist of Dallas has discovered itself in the spotlight for its own issuance of tax-shelter letters. And the exodus of partners from Coudert Brothers’ London and Paris offices and the firm’s possible merger with Baker & McKenzie also has created buzz recently. LONG-RANGE STRATEGIES Those firms likely have devised and are implementing public relations strategies on the heels of those stories, but handling bad news apparently requires a commitment to a long-range plan as well. Vinson & Elkins is well aware of such challenges. The image of the Houston-based firm took a major hit during the collapse of energy giant Enron Corp. Not only did the firm lose a huge client in Enron, but its role as the company’s outside counsel created big problems after it came to light that the firm provided legal opinions for some of Enron’s accounting practices. It also had conducted an internal investigation of Enron that was later deemed insufficient. Today, Vinson & Elkins continues to work on polishing its image among potential hires. “We found that notwithstanding a lot of publicity, if we can get people to come to the firm, we’ve been very successful in convincing them that it’s a great opportunity,” said Joseph Dilg, Vinson & Elkins’ managing partner. Since 2002, the number of attorneys at Vinson & Elkins has fallen from 863 attorneys to about 740, according to The National Law Journal‘s annual survey of the nation’s 250 largest law firms. In addition, gross revenue for the firm, which totaled $440 million in 2003, was down 3.6 percent, compared with 2002, according an annual survey by The American Lawyer, a sister publication to the NLJ. Profits per partner in 2003, however, were up 7 percent to $685,000, compared with 2003. The size of Vinson’s summer associate program had declined in recent years, Dilg said, partly because the “Internet bubble disappeared.” But he also said that, following news stories about the firm’s connection to the Enron debacle, the summer class the following year was smaller. This year, however, 87 summer associates have joined the firm, compared with 68 last year, he said. The increase is partly due to the firm’s efforts to promote a do-good image with potential hires. In the spring, about 70 Vinson & Elkins lawyers traveled to some of the nation’s top law schools and worked alongside students to box meals for the needy as part of its Food Bank Challenge. The firm discussed job opportunities with the students at the same time. “It shows a little bit about who we are as a firm,” said Mark Curriden, senior communications counsel at Vinson & Elkins. THE BLOG FACTOR Making the job of restoring a firm’s image tougher is that law students are more attuned than ever to news of which shops are in or out of favor, explained Ellen Wayne, dean of career services at Columbia Law School. “They’re smart kids. They know,” she said. Media Web sites and blogs keep students updated on juicy stories about law firms, but how much damage those tales can cause is relative, she said. If the bad news stems from a firm in the same community where the law school is located, it has a much bigger impact than if it happens at a nonlocal firm or at a firm’s office in another city, she explained. One way to deal with students’ perceptions of a firm’s troubles is for its lawyers to meet with the career services offices at the schools that they visit to discuss ways to address image problems, Wayne said. Most often, she added, the direct approach is the way to go. “It’s going to come out,” she said. “If it’s on their radar screen, they want to know what happened.” Another firm working to bolster its image is Jenkens & Gilchrist. Its tax-shelter scrape, plus sagging gross revenues and a shrinking attorney roster, were partly what prompted the firm recently to launch a public relations campaign, which includes advertisements in The Dallas Morning News. “From a P.R. standpoint, we have begun an effort to get our name out there in a positive light because of the negative publicity,” said Robert Dockery, chairman of Jenkens & Gilchrist’s employment committee. Profits per partner at Jenkens & Gilchrist slumped 8.8 percent in 2003, compared with 2002, and the firm slid from 480 attorneys to 459 in last year’s NLJ 250. This year, the firm lost 91 attorneys from its New York office, who joined Troutman Sanders. The firm’s current head count is fewer than 300 attorneys. Summer hiring at Jenkens & Gilchrist’s Texas offices was down 49 percent this year to 22, although Dockery said that the decline was part of an effort to “take a more conservative approach” in its summer associate program. The flagging numbers, coupled with the tax-shelter problem, have taken their toll on the stature of the firm, which has nine locations, including offices in New York, Chicago and Los Angeles. The print advertisements, part of a 90-day P.R. blitz, pair the Jenkens & Gilchrist name with some of its key clients and include quotations from clients touting the service the firm has provided. Clients such as electronics retailer CompUSA Inc., a local bank and a real estate firm provide testimonials that Jenkens & Gilchrist is the firm for them. COURTING RECRUITERS The situations at Vinson & Elkins and Jenkens & Gilchrist demonstrate the long-term effects that a firm’s damaged image can cause. Carey Bertolet, managing director of BCG Attorney Search in New York, said that many firms are good at contacting recruiters immediately after some news breaks to get the firm’s side of the story out there. “On a cynical day, you call it spin,” she said. But the fallout from a firm’s problems, if any, may take time to materialize. At Sidley Austin, news of its tax-shelter and age discrimination worries this year came amid the firm’s robust growth. Gross revenue was up to $926 million in last year’s American Lawyer survey, an increase of 11.4 percent from 2003, while profits per partner rose 9.8 percent to $895,000. Moreover, it had more attorneys, about 1,585 in last year’s NLJ 250, compared with 1,559 the previous year. Sidley Austin attorneys declined an interview request for this story, but submitted a written statement through a spokesman about the firm’s current recruiting endeavors. The statement said that it plans to hire 127 new associates in the fall and it will have 205 law students involved in its summer program, numbers that are “typical of recent years.” It also said that “law students understand that all large law and professional services firms in today’s environment are subject to claims being asserted against them.” LATERAL HIRES As for lateral hires, the impact from a law firm’s bad news may be more immediate, Bertolet said. Practicing lawyers usually are more aware of law firms’ reputations through word of mouth, and once a story hits the press, it is a sign that a firm’s situation has gone from bad to worse, she said. “It’s more significant than a whisper here and a whisper there,” she said. Bertolet added that recruiting partners to join generally is more difficult for firms whose reputations are sullied because attorneys are less eager to take an ownership position with a troubled firm. A firm’s hard times may also provide the opportunity for scrappier attorneys with smaller books of business to join its ranks. “There are lateral candidates looking to come in and be a superhero,” she said.

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