Jaroslawa Z. Johnson. (Credit: Ukraine Today via YouTube)
Two years ago, Jaroslawa Zelinsky Johnson left her home on Institutskaya Street in Kiev as anti-government protests turned into violent battles with police and pro-regime forces.
The Euromaidan movement that rocked Ukraine in 2014 put the country in the hands of reformists that Johnson, a Ukrainian American and former managing partner of Chadbourne & Parke’s Kiev office, wholeheartedly supports. But now she has another fight on her hands, one that pits Johnson against her former firm.
On Oct. 13, a day before Johnson celebrated Defender of Ukraine Day in Kiev, she filed papers with a federal court in New York seeking to join a $100 million gender bias suit filed against Chadbourne in late August by current litigation partner Kerrie Campbell in Washington, D.C. Campbell, who joined Chadbourne in early 2014, claims that the firm routinely pays female partners less than their male counterparts and excludes women from positions of authority, allegations that Chadbourne has vigorously denied. Johnson is only the second named plaintiff that has sought to join Campbell’s suit.
Johnson spoke with The American Lawyer from Ukraine, where she frequently travels in her current role as president and CEO of a regional private equity firm based in Chicago. She said her sister told her about Campbell’s suit after it was filed, leading Johnson to read a news story about the case and put in a call to Campbell’s lawyer, David Sanford of New York’s Sanford Heisler. Sanford, she said, then sent her a copy of the complaint.
“I read [Campbell’s suit] and it brought back a flood of memories—the disparity in compensation continues,” said Johnson, noting that she does not know Campbell personally. “I’m not by nature a litigious person, but [joining this case] was an opportunity to help the next generation of women lawyers. That’s why I’m doing this.”
Johnson admits that she was not a rainmaker at Chadbourne. Her annual billings at the firm ranged from $3 million to $5 million, she said, while her compensation started out at roughly $500,000 annually. As the years went on her pay was cut to $325,000, then to $250,000. The reasons for such reductions, she said, were somewhat unclear. Chadbourne seemed to have a selective application of certain compensation criteria when it came to women, Johnson said.
“My revenue could have been in the top 20 [partners] at the firm, but my points would only be in the top 60 or 70,” Johnson said. “You had this incredible disparity between points given and revenue collected. I also had managerial responsibilities that others didn’t have.”
In Johnson’s view, if the Kiev office underperformed, she would bear a disproportionate burden of the financial pain. Cost overruns would be deducted from her own income, she said, something that colleagues in other offices did not have to worry about. A male partner in a countercyclical practice like bankruptcy in New York would still get a year-end bonus because of their “years of service to the firm,” said Johnson, citing a frequent rationale she was given.
“There was definitely favoritism in how [compensation] was determined,” said Johnson, noting that she was frequently ranked as one of the top Western lawyers in Ukraine. “You had five men on the management committee making all the decisions and never explaining them. I would never get a rate uplift.”
Several female partners were also de-equitized in recent years at Chadbourne, Johnson said. The American Lawyer reported in late 2013 on a suit against Chadbourne filed by former arbitration partner Melanie Willems in London over the return of $127,000 in capital.
Pulling Back in Ukraine
Chadbourne hired Johnson in 2004 as part of a team of lawyers in Warsaw and Kiev from now-defunct Chicago firm Altheimer & Gray. One of the reasons that Johnson joined Chadbourne, she said, was the firm’s commitment to emerging markets. In 2014, the same year that the political situation took a turn for the worse in Ukraine, Chadbourne was honored as the country’s “National Law Firm of the Year” by the International Financial Law Review. A year earlier, Chadbourne brought back former banking and finance partner Adam Mycyk in Kiev in anticipation of Johnson stepping down from her local leadership role in 2014.
But by early 2014 Chadbourne’s commitment to Ukraine was gone. Johnson said she received a call from the firm’s managing partner, Andrew Giaccia, telling her to begin preparing to close Kiev and return to the U.S., where she kept an office in Washington, D.C. Johnson spent the next few months disposing of confidential client files and handling other administrative tasks in order to shut down Chadbourne’s Kiev base. In December 2014, she said she was told by Giaccia that her services were no longer needed at the firm. Johnson said she does not receive any health benefits or pension payments from Chadbourne.
Chadbourne closed a small Beijing office in 2015 and earlier this year spun-off its Warsaw base into an independent firm. Those moves followed other efforts by the firm to streamline its operations, such as the shuttering of its outpost in Almaty, Kazakhstan, after a lateral raid by Dechert in 2012. (Dechert also sought to poach from Chadbourne’s Moscow office.)
The decisions confused Johnson, who said that in 2012 all of Chadbourne’s partners gathered at a New York hotel for a meeting with an outside consultant—she cannot remember who—to brainstorm strategic options for the firm. Johnson left the meeting confident that Chadbourne’s presence in emerging markets would help the firm distinguish itself from the competition.
A charter member of The American Lawyer’s Am Law 100 rankings, Chadbourne slipped into the Second Hundred ranks in 2012 as gross revenue fell 5.1 percent, to $290.5 million, and head count dropped 8 percent, to 373. Chadbourne sought to refocus itself that year on a few key practice areas: project finance, litigation, corporate and tax work. By 2015, the New York-based firm’s head count stood at 318, while gross revenue had fallen to $249 million.
“We had a symbiotic relationship—we faced the same issues and had similar clients,” Johnson said about her former colleagues in Almaty and Warsaw. The decision by Chadbourne to shrink its geographic presence had a direct effect on her own practice, she said, despite the geopolitical and economic issues in Ukraine. “I always thought [those moves] were an effort to make the firm more suitable for a merger,” added Johnson, noting Chadbourne’s ultimately unsuccessful tie-up talks with Pillsbury Winthrop Shaw Pittman and British firm Watson Farley & Williams. “But even after all of that [cost-cutting] they still haven’t been able to get a deal done.”
Chadbourne claims that Johnson’s allegations are without merit and that the firm’s decision to exit Ukraine was the result of a deteriorating situation in a country where the demand for high-end legal services had shriveled, a development previously covered by The American Lawyer.
“Ms. Johnson was the equity partner in charge of our office in Kiev. Chadbourne closed its office in the Ukraine in 2014 after a number of money-losing years made worse by political turmoil and a challenging economic climate,” said a statement by a firm spokesman. “As previously stated, Chadbourne categorically denies all of the suit’s allegations against the firm, including the charges of gender discrimination.”
In September, a group of 14 female Chadbourne partners wrote a letter refuting the allegations put forth by Campbell in her suit against the firm. Johnson read the letter, but said it was mostly signed by female partners in the U.S. A Chadbourne spokesman said that among those signing the letter were London-based partners Michelle George, Agnieszka Klich and Irina Tymczyszyn. Johnson said she spoke with Tymczyszyn, an international arbitration expert from Ukraine, before she joined Chadbourne’s London office earlier this year.
“I had good things to say [to Tymczyszyn] about London,” Johnson said, calling the office a service center for Chadbourne’s other international outposts in Dubai, Istanbul, Johannesburg and Moscow. But the reason Chadbourne needed a Ukrainian-speaking lawyer like Tymczyszyn, Johnson said, is because the firm’s presence had withered in Eastern Europe, constraining its ability to advise on cross-border deals from that region structured under English law.
Johnson also said that in the aftermath of Campbell’s suit, Chadbourne named Ayse Yuksel, a woman who serves as managing partner of the firm’s Istanbul office, to its new management committee. “The international offices had for years been looking to have some form of representation in management,” said Johnson, who praised Yuksel as an excellent lawyer but admitted to being struck by the timing of the announcement. “I think [Yuksel’s appointment] satisfied their gender and international issues.”
A Chadbourne spokesman said that Yuksel was elected to Chadbourne’s management committee by the firm’s equity partnership before Campbell’s suit was filed. He said Yuksel had previously served for three years as an ex-officio member of the committee before replacing longtime Chadbourne partner Marc Alpert, a former head of the firm’s public companies practice who joined New York-based conglomerate Loews Corp. this summer as general counsel.
Life After Chadbourne
Despite her current adversarial position against Chadbourne, Johnson still has good memories from her decade at the firm. She praised the firm’s longtime leader, Charles O’Neill, who was replaced by Giaccia in late 2010. (O’Neill is now of counsel at Chadbourne and chair of the firm’s pro bono committee.) Johnson also credits her time at Chadbourne with helping her acquire the professional contacts she needed after the firm left Ukraine.
Johnson was born in the former Soviet republic, spending two months in Ukraine before her parents fled to the U.S. at the end of World War II. She grew up bilingual in Baltimore, starting her career as a teacher before attending the University of Wisconsin Law School, graduating in 1977. Her first legal job was at Reuben & Proctor, an upstart Chicago firm that had an ill-fated merger with another Windy City shop before collapsing in 1988. Johnson moved on to Hinshaw & Culbertson, where she made partner, leaving in 1993 for Altheimer & Gray as part of a wave of Western-educated lawyers seeking opportunities behind the former Iron Curtain.
While working in Ukraine, Johnson joined the board of directors of the Western NIS Enterprise Fund. She was hired as its new CEO after the private equity firm’s former leader, Natalie Jaresko, was named Ukraine’s minister of finance. Johnson now works closely with Ukraine’s top political leaders, including President Petro Poroshenko, doing investment work.
The American Lawyer reached out to nearly a dozen former Chadbourne female partners for their assessment of Johnson and Campbell’s claims. Three of them responded, all requesting anonymity in order to speak freely. Two former female partners said they agreed with Johnson and Campbell and praised them for coming forward.
“Chadbourne is not that big … so between the small size and the availability of every partners’ originations, billings, recollections and compensation, it’s not hard to know what’s going on,” said one ex-partner.
Another former female partner said that during her time at Chadbourne she saw no evidence of gender discrimination.
“If you had the business, you were valued accordingly,” said the ex-partner, noting that she didn’t always agree with compensation decisions made by Chadbourne management. “What I saw create unhappiness was origination credit.”
Origination credit, of course, has been cited by some legal market observers as a potential reason for the disparity in pay between male and female partners. A survey last week by legal recruiting firm Major, Lindsey & Africa found that on average, male partners earned 44 percent more than their female counterparts.
Mycyk, Johnson’s former colleague in Kiev and now a partner at Dentons in the city, did not return a request for comment. Campbell’s complaint, submitted by Sanford and Sanford Heisler associate Saba Bireda, claimed that it was filed on behalf of 26 current and former female partners at Chadbourne. Sanford, who appeared with Campbell last week at Stanford Law School, did not respond to a request for comment.