The High Price of Keeping Up Appearances

The not-entirely-surprising news that leaders of a certain bankrupt big-name law firm have been indicted (Matthew Goldstein, Former Top Leaders of Dewey & LeBoeuf Are Indicted, New York Times DealB%k, Mar. 6, 2014) is a cogent reminder that law firms in trouble don’t exactly confess to it. They may indeed go to unfathomable lengths to maintain an air of business-as-usual even as that very business is going down the drain. Really, who wouldn’t have doubts about a firm that couldn’t even manage itself?

Be aware that a troubled employer probably won’t disclose its real status. How many of us have heard about firms that still send recruiters to law schools even though they know no offers will be made? Is a firm having difficulty paying its legal research database bills? Have its copiers just been repossessed? Has the firm abruptly stopped providing certain benefits? Note the details. Talk to people.

Need to learn more about an enterprise?  Try chatting someone up in the restroom.

Prospective new hires need to remember to undertake as much due diligence as they can before signing on to any firm. What can be learned about a firm’s fortunes? Pay attention to appearances. How run down is the place? What do the back rooms look like? How current is equipment?

Try to chat up as many prospective colleagues as you can. To this day, some of my own best reconnaissance has occurred in the lavatory. It can be amazing whom you might strike up a conversation with while you’re applying more lip gloss in the ladies room. It can be even more amazing what a stranger in the bathroom might actually tell you.

See also Lori Tripoli, Don’t Be the One Laid Off: Check your Employer’s Background First, ContemporaryLawOfficeManagement, June 24, 2013.

—Lori Tripoli

Did Dewey Ruin It for the Remaining Top-Dollar Firms?

In light of a recent report apparently revealing just how much Dewey & LeBoeuf’s executive director and CFO were making  before the firm went bust (Sara Randazzo, Suit Details Ex-Dewey Leaders’ Lucrative Pay Pacts, Am Law Daily, Dec. 1, 2013), I can’t imagine the conversations that former Dewey clients are having with their supervisors.  

We paid how much? How much of that actually went to firm overhead? What was our return on investment? Actually, what I really can’t imagine are the answers. Absolutely, I can understand the need and desire to pay high-end. All sorts of clients need big-name lawyers and their accompanying big-time prices for all types of legal assistance. But where’s the line between paying for the gold standard and just opening the vault and letting your lawyers take whatever’s in it?

Are six-year contracts worth $15.9 million apiece for an executive director and a CFO too much? All I know is that if I were a corporate client, I’d be asking my own lawyers a few questions about firm finances. If I were Dewey’s competitors, I’d be ready for some answers and be more than willing to explain why we are not them.

—Lori Tripoli

Mega Firms Are Not Too Big to Fail

The implosion of Dewey & LeBoeuf (“Sources Say Dewey toClose Doors May 15 If Not Before,” reports AmLawDaily) is a cogent reminder to rainmakers, bread-and-butter partners, counsel, senior associates, junior associates, clueless associates, summer associates, and staff that no matter how comfortable you might be, the end might be near. It’s tempting to coast a bit when the surroundings are cushy. But in today’s economy, no one can really afford to do that. Keep that resumé polished and those contacts updated. Remember to look over your shoulder, no matter where you are. Don’t let your firm’s faltering financial situation set your career back.

“Oops, I Was Laid Off Again”

No one wants that line as her theme song, especially in depressing (er, invigorating!) times as these.  Firms continue to “right size.” The latest example? Planned cutbacks at Dewey & LeBoeuf, which is “aligning” its resources (i.e., trimming lawyers and staff).  Story here.

No matter how challenging the market, lawyers and staff alike should be proactive to make sure their heads aren’t on the chopping block. Are you making your billables? Are you marketing yourself, your practice, your firm? Are you networking internally and externally and displaying plenty of drive? Are you bringing in business? Doing none of the above? Then don’t be too, too surprised if your name is on a pink slip. Have you done all of these things and been laid off anyway? Then you should be that much better positioned to find a new job or to open a new business. Don’t just sit around and wait for layoffs to happen.