AROUND THE FIRMS

Former Attorney Cannot Sue Counsel Who Takes Over a Case. US District Judge Berle M. Schiller of the Eastern District of Pennsylvania presented a seven-page opinion declaring that because a lawyer's withdrawal from a case severs the attorney-client relationship, an attorney who then assumes the case and obtains a settlement cannot be subjected to a lawsuit for part of the fee; nor can the new attorney be sued for intervention in the former lawyer's relationship. Frederick v. Davitt, No. 02-8263. Also, after discovering their contingent fee agreement's ubiquitously worded arbitration clause, which called for any fee debate's mediation, Judge Schiller dismissed the former attorneys' claims against the client.

Attorney Kathleen Frederick along with the law firm Cureton Caplan brought the case. In their suit against former client Patricia Davitt, Richard J. Orloski, the client's new attorney, was subjected to claims of tortious interference, quasi-contract, negligent misrepresentation and quantum meruit. Court papers state that Ms. Frederick, along with lawyer Thomas Hunt, filed a discrimination suit on Ms. Davitt's and her co-worker's behalf. However, when a global settlement offer was made by the defendant, it was rejected by Ms. Davitt but accepted by her co-worker. It was then that the attorneys withdrew from the case, resulting in Ms. Davitt representing herself.

When the discrimination claim was dismissed on summary judgment, Ms. Davitt still had a claim for invasion of privacy. She hired Mr. Orloski, and a confidential settlement was established. The former attorneys felt that they were owed a portion of the fee ' a minimum of 40% of the recovery. Mr. Frederick and Mr. Hunt professed that Mr. Orloski secured a settlement with Ms. Davitt and wrongly kept the entire fee, despite his statement to the attorneys that he did not plan to represent the defendant. Attorney Glenn Matthew Goodge of Goodge & Makoul, based in Allentown, PA, maintained that the argument should be sent to arbitration. Although Pinnola & Bomstein attorney Michael S. Bomstein, who represented the attorneys, protested that the arbitration clause was null and void because of Mr. Oloski's allegation of the fee agreement's implausibility, Judge Schiller disagreed. He stated that Mr. Orloski was not able to contest the agreement's existence; Ms. Davitt had no contest regarding the agreement's efficacy, so the judge mandated its enforcement. Furthermore, he questioned the attorneys' motives for filing the complaint against Mr. Orloski. Mr. Bornstein expressed his discord with the judge's ruling and he plans on consulting with his clients to determine whether an appeal will follow.

New York Firms Use Perks to Compensate for Salary Decreases. With the decline in salaries for associates at New York's largest law firms comes the discussion of sufficient benefit packages. Human Resources mangers from approximately 30 law firms comprise the Legal Benefits Group, which focuses on common personnel matters as opposed to individual firms' specific details. Participating firms include Cadwalader Wickersham & Taft; Kelley, Drye & Warren; Latan & Watkins; and Shearman & Sterling. According to Don R. Cox, benefits and human resources manager at Cadwalader Wickersham, the group determines issues to be discussed and then distributes an e-mail requesting feedback and general agreement. The firms' associate committees are able to offer the group ideas. Past issues include long-term care and disability benefits, and developments in online benefits programs, a new area. The firms rotate among themselves for meeting locations.

West Coast Firms Award Associates With Bonuses and Raises. New York is not the only state where firms are looking out for their associates; in California, San Francisco-based Orrick, Herrington & Sutcliffe and Heller Ehrman White & McAuliffe, along with Palo Alto-based Cooley Godward, have announced their plans to award performance bonuses to deserving associates. Between the three firms, the bonuses range in amounts from $10,000 to $75,000. First-year associates at Heller Ehrman will receive anywhere from $13,000 to $45,000.

At Orrick, the qualifications for a bonus entail an associate billing 2,000 hours in 2002, which would be an increase of 50 hours from 2001. When hours reach 2,100 and 2,200, additional hours-based bonuses will be awarded. In order to qualify for a top bonus, an associate must achieve a minimum of 2,300 hours (cut from 2,400).

Overall, Orrick associates garnered approximately 10% more in bonuses last year than in the previous year. According to John MacKerron, managing director for offices, Orrick has had similar increases in revenues and profits increases. In its annual report, the firm had a 14% increase in per-partner profits and a 9% increase in revenues, as reported in The Recorder.

The bonuses are not the only perk in store for associates: The firms recently announced that they would permit associate classes to progress to the next pay step. Several firms, including Cooley, had to freeze salaries in 2002.

Firms Need to Ensure Survival When Losing Top Players. In the past couple of years, several of the United States' largest law firms have been faced with the situation of major players moving over to the federal bench ' and how to survive the loss. The following are examples of how some firms handled it.

Washington, DC's largest firm, Hogan & Hartson, recently became subjected to the possibility of losing a key player: John Roberts Jr. Roberts, a big-firm appellate specialist, had a hearing in late January for a federal court of appeals nomination. This will potentially have a huge impact on Hogan. The firm also endured other, at least temporary, losses: David Leitch, who served as second chair for many of Mr. Roberts' cases, was recently appointed as deputy White House counsel, while former appellate partner H. Christopher Bartolomucci became an associate White House counsel in 2001. Despite all the speculation, J. Warren Gorrell Jr., managing partner at Hogan, maintains that the firm places an emphasis on teamwork and that the departure of a key individual will not diminish the practice's level of service.

In 2002, Kenneth Geller, who heads Chicago-based Mayer, Brown Rowe & Maw's appellate practice and is also a partner in charge of the DC office, faced a significant loss: Michael McConnell, who served as the appellate group's counsel and as a law professor at the University of Utah, joined the Tenth US Circuit Court of Appeals. However, Mr. Geller explained that although the firm suffered a big void with Mr. McConnell's departure, Mayer Brown employs a strategy of team marketing as opposed to depending heavily on an individual. Therefore, the firm was not affected as strongly as it could have been.

Another strategy was employed in 2001 by Cleveland-based Jones Day. In 2000, the firm had experienced the loss of partner Timothy Dyk, who had become a Federal Circuit judge. Jones Day hired Michael Carvin, an accomplished Supreme Court litigator, to succeed Mr. Dyk after Mr. Carvin lost his boutique firm, Cooper & Carvin. No comment was made regarding the potential departure from Jones Day of Jeffery Sutton, another attorney who in January had a Senate Judiciary Committee hearing concerning a nomination to the federal court of appeals.

Gibson, Dunn & Crutcher, a Los Angeles-based firm, faces the possible loss of Miguel Estrada, whose Federal Court of Appeals nomination was approved by the panel and sent to the Senate floor. Mr. Estrada's appointment would mean the firm's loss of two key players; counting the loss of Ted Olson, who is now US Solicitor General. However, Thomas Hunger, co-chair of Gibson Dunn's appellate and constitutional law practice group, is confident that the firm's team of attorneys will suffice.

Lisa Smith, who heads law firm consultant Hildebrandt International's DC office, explained that an appellate practice at a firm is usually empowered by names and by character. Therefore, losing a notable is like losing a piece of the practice. DC-based National Chamber Litigation Center Senior Vice President Robin Conrad advises firms to avoid employing the 'star' system and instead to operate the way that Mayer Brown has. Sidley Austin Brown & Wood is one such firm that has not gone the route of the team player approach. Carter Phillips, who heads the DC office and is an appellate expert, is the person on whom the firm's appellate and Supreme Court practice mainly centers. While Mr. Phillips has no intentions of leaving the firm, he does admit he is the reason that Sidley obtains most of its appellate work. He acknowledges that it might be in the best interests of a firm in which an integral partner has moved to the federal bench to adopt a more contentious approach in seeking work. Mr. Phillips also suggests that a firm in this position probe its billing practices and award clients with some breaks.

Teri Zucker is a reporter for Law Firm Partnership & Benefits Report.

Former Attorney Cannot Sue Counsel Who Takes Over a Case. US District Judge Berle M. Schiller of the Eastern District of Pennsylvania presented a seven-page opinion declaring that because a lawyer's withdrawal from a case severs the attorney-client relationship, an attorney who then assumes the case and obtains a settlement cannot be subjected to a lawsuit for part of the fee; nor can the new attorney be sued for intervention in the former lawyer's relationship. Frederick v. Davitt, No. 02-8263. Also, after discovering their contingent fee agreement's ubiquitously worded arbitration clause, which called for any fee debate's mediation, Judge Schiller dismissed the former attorneys' claims against the client.

Attorney Kathleen Frederick along with the law firm Cureton Caplan brought the case. In their suit against former client Patricia Davitt, Richard J. Orloski, the client's new attorney, was subjected to claims of tortious interference, quasi-contract, negligent misrepresentation and quantum meruit. Court papers state that Ms. Frederick, along with lawyer Thomas Hunt, filed a discrimination suit on Ms. Davitt's and her co-worker's behalf. However, when a global settlement offer was made by the defendant, it was rejected by Ms. Davitt but accepted by her co-worker. It was then that the attorneys withdrew from the case, resulting in Ms. Davitt representing herself.

When the discrimination claim was dismissed on summary judgment, Ms. Davitt still had a claim for invasion of privacy. She hired Mr. Orloski, and a confidential settlement was established. The former attorneys felt that they were owed a portion of the fee ' a minimum of 40% of the recovery. Mr. Frederick and Mr. Hunt professed that Mr. Orloski secured a settlement with Ms. Davitt and wrongly kept the entire fee, despite his statement to the attorneys that he did not plan to represent the defendant. Attorney Glenn Matthew Goodge of Goodge & Makoul, based in Allentown, PA, maintained that the argument should be sent to arbitration. Although Pinnola & Bomstein attorney Michael S. Bomstein, who represented the attorneys, protested that the arbitration clause was null and void because of Mr. Oloski's allegation of the fee agreement's implausibility, Judge Schiller disagreed. He stated that Mr. Orloski was not able to contest the agreement's existence; Ms. Davitt had no contest regarding the agreement's efficacy, so the judge mandated its enforcement. Furthermore, he questioned the attorneys' motives for filing the complaint against Mr. Orloski. Mr. Bornstein expressed his discord with the judge's ruling and he plans on consulting with his clients to determine whether an appeal will follow.

New York Firms Use Perks to Compensate for Salary Decreases. With the decline in salaries for associates at New York's largest law firms comes the discussion of sufficient benefit packages. Human Resources mangers from approximately 30 law firms comprise the Legal Benefits Group, which focuses on common personnel matters as opposed to individual firms' specific details. Participating firms include Cadwalader Wickersham & Taft; Kelley, Drye & Warren; Latan & Watkins; and Shearman & Sterling. According to Don R. Cox, benefits and human resources manager at Cadwalader Wickersham, the group determines issues to be discussed and then distributes an e-mail requesting feedback and general agreement. The firms' associate committees are able to offer the group ideas. Past issues include long-term care and disability benefits, and developments in online benefits programs, a new area. The firms rotate among themselves for meeting locations.

West Coast Firms Award Associates With Bonuses and Raises. New York is not the only state where firms are looking out for their associates; in California, San Francisco-based Orrick, Herrington & Sutcliffe and Heller Ehrman White & McAuliffe, along with Palo Alto-based Cooley Godward, have announced their plans to award performance bonuses to deserving associates. Between the three firms, the bonuses range in amounts from $10,000 to $75,000. First-year associates at Heller Ehrman will receive anywhere from $13,000 to $45,000.

At Orrick, the qualifications for a bonus entail an associate billing 2,000 hours in 2002, which would be an increase of 50 hours from 2001. When hours reach 2,100 and 2,200, additional hours-based bonuses will be awarded. In order to qualify for a top bonus, an associate must achieve a minimum of 2,300 hours (cut from 2,400).

Overall, Orrick associates garnered approximately 10% more in bonuses last year than in the previous year. According to John MacKerron, managing director for offices, Orrick has had similar increases in revenues and profits increases. In its annual report, the firm had a 14% increase in per-partner profits and a 9% increase in revenues, as reported in The Recorder.

The bonuses are not the only perk in store for associates: The firms recently announced that they would permit associate classes to progress to the next pay step. Several firms, including Cooley, had to freeze salaries in 2002.

Firms Need to Ensure Survival When Losing Top Players. In the past couple of years, several of the United States' largest law firms have been faced with the situation of major players moving over to the federal bench ' and how to survive the loss. The following are examples of how some firms handled it.

Washington, DC's largest firm, Hogan & Hartson, recently became subjected to the possibility of losing a key player: John Roberts Jr. Roberts, a big-firm appellate specialist, had a hearing in late January for a federal court of appeals nomination. This will potentially have a huge impact on Hogan. The firm also endured other, at least temporary, losses: David Leitch, who served as second chair for many of Mr. Roberts' cases, was recently appointed as deputy White House counsel, while former appellate partner H. Christopher Bartolomucci became an associate White House counsel in 2001. Despite all the speculation, J. Warren Gorrell Jr., managing partner at Hogan, maintains that the firm places an emphasis on teamwork and that the departure of a key individual will not diminish the practice's level of service.

In 2002, Kenneth Geller, who heads Chicago-based Mayer, Brown Rowe & Maw's appellate practice and is also a partner in charge of the DC office, faced a significant loss: Michael McConnell, who served as the appellate group's counsel and as a law professor at the University of Utah, joined the Tenth US Circuit Court of Appeals. However, Mr. Geller explained that although the firm suffered a big void with Mr. McConnell's departure, Mayer Brown employs a strategy of team marketing as opposed to depending heavily on an individual. Therefore, the firm was not affected as strongly as it could have been.

Another strategy was employed in 2001 by Cleveland-based Jones Day. In 2000, the firm had experienced the loss of partner Timothy Dyk, who had become a Federal Circuit judge. Jones Day hired Michael Carvin, an accomplished Supreme Court litigator, to succeed Mr. Dyk after Mr. Carvin lost his boutique firm, Cooper & Carvin. No comment was made regarding the potential departure from Jones Day of Jeffery Sutton, another attorney who in January had a Senate Judiciary Committee hearing concerning a nomination to the federal court of appeals.

Gibson, Dunn & Crutcher, a Los Angeles-based firm, faces the possible loss of Miguel Estrada, whose Federal Court of Appeals nomination was approved by the panel and sent to the Senate floor. Mr. Estrada's appointment would mean the firm's loss of two key players; counting the loss of Ted Olson, who is now US Solicitor General. However, Thomas Hunger, co-chair of Gibson Dunn's appellate and constitutional law practice group, is confident that the firm's team of attorneys will suffice.

Lisa Smith, who heads law firm consultant Hildebrandt International's DC office, explained that an appellate practice at a firm is usually empowered by names and by character. Therefore, losing a notable is like losing a piece of the practice. DC-based National Chamber Litigation Center Senior Vice President Robin Conrad advises firms to avoid employing the 'star' system and instead to operate the way that Mayer Brown has. Sidley Austin Brown & Wood is one such firm that has not gone the route of the team player approach. Carter Phillips, who heads the DC office and is an appellate expert, is the person on whom the firm's appellate and Supreme Court practice mainly centers. While Mr. Phillips has no intentions of leaving the firm, he does admit he is the reason that Sidley obtains most of its appellate work. He acknowledges that it might be in the best interests of a firm in which an integral partner has moved to the federal bench to adopt a more contentious approach in seeking work. Mr. Phillips also suggests that a firm in this position probe its billing practices and award clients with some breaks.

Teri Zucker is a reporter for Law Firm Partnership & Benefits Report.