Posts on ‘January 23rd, 2009’

Baker & McKenzie has cut 20 legal positions in London and is set to consider layoffs among its support staff. The firm confirmed Friday that 20 associates and paralegals have lost their jobs, affecting several practice areas, including corporate. In addition, the firm has launched a review of its secretarial and support services. Baker & McKenzie is one of a growing number of U.S. firms to formally reduce staff numbers in London.

Not surprisingly, the economic downturn is causing more clients to fall behind on paying legal bills. The trend became more noticeable in December, when some firms pull in as much as 30 percent of their annual revenue with year-end collection efforts. Some firms are making adjustments in the current economic climate. “We’ve negotiated more payment plans under the theory that it is better to get paid over time than not to get paid at all,” says Bill Maass, executive director of Finn, Dixon & Herling.

The new year has begun, but a damaged economy continues to keep midsize firm leaders largely in the dark about expectations for the next 12 months. Stephen A. Madva, chairman of Montgomery McCracken Walker & Rhoads, acknowledges “the most upbeat comments by the best and brightest” financial experts say the economy could see an uptick in the third quarter, but notes, “the best and brightest are wrong on a regular basis.” Still, a number of firms anticipate new work from increased governmental regulation.

It turns out that stock option backdating poster child Gregory Reyes went looking for clemency in the waning days of the Bush administration. Once a prince of Silicon Valley, the former Brocade CEO suffered a conviction in 2007 on 10 counts, securities fraud among them. To date, he is one of two executives the government has successfully prosecuted for backdating-related crimes.

Houston lawyer Richard T. Howell Jr., whose firm was scammed out of $182,500 by a client who hired him through e-mail, says he is talking publicly about the situation so he can prevent other lawyers from making the same mistakes. “I’m a capital ‘D’ Dumbass,” says Howell, who has practiced law for 23 years and is a partner in Buckley White. Because he is responsible, Howell says, he did not ask his partners to help him cover the loss. To reimburse his firm, he says he had to borrow money on a home equity loan.

Two Florida attorneys indicted in a nearly $1 billion Ponzi scheme known as Mutual Benefits are anything but fly-by-night hucksters known to be associated with a pyramid con. Michael McNerney and Anthony Livoti Jr. are well-respected advocates and have been fixtures in the legal community for decades. Lawyers for the men say that they were acting in their ethical role as attorneys advising Mutual Benefits.

As the 2009 recession takes hold, juries are expected to stick it to employers in workplace disputes, with the economy weighing heavily on their minds amid a growing mistrust of corporate management. Lawyers on both sides of employment litigation say they expect juries this year to be more sympathetic to employee plaintiffs than to employers, holding management to higher standards and doling out larger verdicts in cases involving everything from wrongful termination to retaliation to discrimination.

The phone is ringing off the hook in the office of Stuart Nichols, general counsel at tiny MIPS Technologies. Who’s on the line? A lot of “old friends” at law firms who suddenly aren’t so busy, just calling to see if he wants to go to lunch and “catch up.” “When times are good, they’ve got their book of business — now they’re really desperate for a job that would just involve a few hours,” said Nichols. So, are general counsel actually swayed to hand over legal work because of a free lunch?

President-elect Barack Obama, who just selected Hilda Solis, a strong union supporter, as his Secretary of Labor, will have the opportunity to dramatically reshape the National Labor Relations Board by appointing pro-union board members. Attorney Paul Galligan discusses the top 10 pro-employer board decisions under President George W. Bush that are now in jeopardy, understanding that it may take some time before the issues in question are presented to the Obama board as appeals.

Sparked by a wave of litigation against financial services companies,
the number of federal class action suits filed last year grew 19
percent, according to a recent report. One expert suggested that
litigation against the financial sector may be slowing because attorneys
are running out of defendants to sue, but other observers say that
market volatility during the wild fourth quarter of 2008 may have been
so extreme that investors, attorneys and potential defendants are still
coming to grips with events.