Latham Fires 190 Lawyers in Biggest Law-Firm Cuts (Update2)
By Lindsay Fortado and Carlyn Kolker
Feb. 27 (Bloomberg) -- Latham & Watkins LLP, the fourth- largest U.S. law firm, fired 190 lawyers and 250 staff as the economic slump erodes demand for its services.
The cuts, amounting to 12 percent of the firm’s associates and 10 percent of its paralegals and staff, are the biggest at a U.S. law firm this year. The fired lawyers will get six months’ salary, or as much as $100,000, and six months of medical coverage, the Los Angeles-based firm told employees today in an internal memo.
Latham, whose clients include the Carlyle Group, UBS AG, Deutsche Bank AG, Harrah’s Entertainment Inc., Oracle Corp. and Apple Inc., had revenue of $1.9 billion in 2008, down from more than $2 billion in 2007, according to the American Lawyer, a trade publication.
“The depth and duration of this recession is unprecedented and we expect the health of the global economy to remain weak at least through 2009,” Latham Chairman Robert Dell said in a statement. “We must adjust our staffing levels in line with the projected needs of our clients.”
Rival firms with more than 1,500 lawyers may follow Latham, law firm consultant Peter Zeughauser said today in an interview. Firms that handle corporate and real estate work are particularly vulnerable, he said.
“There is going to be a lot of pressure on management at other firms to do something,” Zeughauser said. “For these firms, it’s going to be for whom the bell tolls.”
DLA Piper Cuts
Earlier this month, DLA Piper, the world’s largest law firm, said it would fire 80 lawyers and 100 other workers, and Tampa, Florida-based Holland & Knight dismissed 70 lawyers and 173 support staff, in what was then the largest round of cuts.
Some firms didn’t trim enough lawyers at first, forcing them to announce multiple firings, Zeughauser said.
“Latham is making a clear effort to do it once and get it over with,” he said.
Sonnenschein, Nath & Rosenthal, based in Chicago, said separately today that it is closing its office in Charlotte, North Carolina. Some of the site’s 11 lawyers will be offered jobs in other firm offices, Sonnenschein Chairman Elliott Portnoy said in a memo.
In October, Sonnenschein fired about 24 lawyers. The firm announced in December that it was hiring 100 lawyers from New York-based Thacher Proffitt & Wood, which shut down that month.
Latham was the fourth-largest U.S. law firm in 2008 with 2,322 lawyers, according to the National Law Journal, a trade newspaper. DLA Piper had 3,785.
To contact the reporters on this story: Lindsay Fortado in New York at lfortado@bloomberg.net; Carlyn Kolker in New York at ckolker@bloomberg.net.
Last Updated: February 27, 2009 15:58 EST |
