The collapse of Dewey & LeBoeuf, which once had more than 1,000 lawyers, has caused what a senior legal recruiter calls a “massive disruption” in the job market for attorneys in New York.
Recruiters were hearing from Dewey partners and associates months before rising costs and falling revenues prompted the firm to replace chairman Steven Davis in April.
“There were junior partners who were getting paid very little and we were hearing from them last year,” said a senior New York recruiter who wished to remain anonymous and was not authorized to discuss partner concerns. Some Dewey partners said they weren’t getting paid much more than associates, the recruiter added.
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But calls to some recruiters only increased in the last couple of months as more and more attorneys left the firm. Some Dewey associates were told that today would be their last day at the firm.
Recruiters say that other firms are cherry picking Dewey’s most valuable partners and associates.
“You can compare it to a feeding frenzy,” said Robert Kinney, founder and president of Houston-based Kinney Recruiting, which has a New York office.
Kinney Recruiting has worked with about 20 Dewey partners in their searches, Kinney said. Some of his law firm clients have asked the agency to find capable associates from Dewey, while others, starting a few months ago, have asked the agency to go after specific groups within the firm, he said.
Some firms prefer groups more than individual lawyers because they have greater confidence that the partners’ clients will follow a group, Kinney added.
In group moves announced yesterday, Paul Hastings picked up Michael Fitzgerald, the co-chair of Dewey’s corporate finance group, along with three other Dewey partners. Hogan Lovells picked up Dewey partners James FitzPatrick Jr. and Martha Steinman.
And in an individual move yesterday, Sutherland Asbill & Brennan said it had added Ellen Dunn to its litigation group. Dunn served as co-head of Dewey’s U.S. litigation practice.
In the last few weeks, Joel Berger, president of Meridian Legal Search in New York, said he’s noticed “more frantic calls” from lawyers who were still at Dewey.
Associates started contacting Berger’s agency toward the end of 2011 and the beginning of this year. Since then, the interest has only grown.
“I can’t imagine any Dewey associate who hasn’t had their resume out for quite a while,” Berger said.
And in the last six months or so, Dewey partners have been more amenable to taking recruiters’ calls, he added.
One former Dewey partner has suggested that recruiters contributed to Dewey’s apparently imminent demise.
“There are many of us who believe that it was the recruiters who got the story from the blogs and took it over to the mainstream press, because for a year prior to the first stories coming out, I was besieged by calls from recruiters as were my associates,” Stuart Saft, former chair of Dewey’s real estate practice and now a Holland & Knight partner, said in a video interview with a Bloomberg correspondent.
Saft added: “This was going to be a bonanza for the recruiters if they could destabilize the situation and get partners to move their practices.”
Recruiters did call Dewey’s attorneys more often after “word leaked” of the firm’s problems, said Berger, but he said the firm’s lawyers also got calls from other firms and clients encouraging them to leave.
One recruiter said Saft’s comments were comparable to blaming the U.S. Coast Guard when a captain runs his ship up a reef.
For some firms, the collapse of Dewey “is a chance to upgrade their associates,” said the senior recruiter in New York. “They can get people they wouldn’t have been able to get.”
The sudden availability of the Dewey attorneys has affected the entire market, recruiters say.
“There are a lot of associate positions that have been put on hold” because some firms are hoping they can attract Dewey lawyers, said another recruiter, Marina Sirras, owner of a New York-based recruiting agency.
But not all Dewey partners or associates have been fortunate enough to find other work. Kinney said his firm has received a couple of dozen calls from associates over the past few weeks, including those who were left by partners moving to other firms, he added.
While many partners have links to other firms and know where to land, “the associates are kind of scrambling at the moment,” Kinney said.
Berger said most Dewey attorneys will find other firms, but senior associates are more at risk of long spells of unemployment because other firms will want junior associates for day-to-day legal work. Also at risk, he said, are the “service partners”—those who do the legal work of rainmakers but don’t have their own book of business.
Michael Lord, managing director of Michael Lord & Co., a legal recruiting agency based in New York, said he doesn’t believe all the Dewey lawyers can find jobs right away.
“I don’t think there’s enough space in the legal market to absorb all the Dewey lawyers that aren’t prepackaged in a group,” he said.
“When they don’t connect quickly with (another firm), then they’re going to be in the market place for weeks,” he said. “And then weeks turn to months, and then it becomes more difficult.”
The longer they are on the market, the less desirable they may be, he said.
“That goes for anyone on the market,” he added.
The influx of attorneys from Dewey is saturating the New York legal landscape, according to recruiters.
“The ripples go everywhere,” said the senior recruiter, “because there are so many people who suddenly have been thrown into the market who have an extreme emergency in trying to figure out where they’re going next.”
The recruiter added, “It puts other people to one side until (firms) can sort out the Dewey folks.”
In the last year in New York, firms have been much more active in recruiting lawyers than from 2008 through 2010, said Danice Kowalczyk, a co-managing partner for Laurence Simons in North America.
Still, the selection process is longer and firms are taking their time evaluating candidates, she said.
“The market is still in their (firms’) favor,” she said. “So they have the luxury of being very selective if they choose to.”
As its troubles deepened, Dewey put its summer associate class on hold, reportedly leaving about 30 law schools students without crucial internships. But some law firms have picked up the slack. Cadwalader, Wickersham & Taft, for instance, is accepting two or three summer associates from Dewey.
The firm already had a full class of 30 summer associates.
Paul Mourning, chair of Cadwalader’s hiring committee, said taking on the additional summer associates “was a combination of trying to help out in a difficult situation and frankly for us looking for good candidates.”
Mourning added that he has heard about other Dewey summer associates finding work this year.
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