February 1, 2010 6:00 AM
The 2010 Lateral Report: Buyer's Market
Posted by Ed Shanahan
By Vivia Chen from the February 2010 Issue of The American Lawyer
By most measures, 2009 was a dismal year for the legal industry. One notable exception to the drumbeat of record layoffs and bankruptcy actions: By our count, there were also a record number of lateral partner moves in The Am Law 200.
In the 12 months ending September 30, 2009, 2,775 partners left or joined the biggest firms in the country--a 10.6 percent increase in mobility over last year. Many firms were "opportunistic" about adding outsiders, and some of the same firms pushed partners out. Fortunately, partners who didn't want to spend their afternoons playing Minesweeper on their BlackBerrys had time to check out the competition.
Litigation partners, representing 17 percent of all partner lateral moves, led the pack, followed by banking and finance lawyers at 15 percent, corporate attorneys at 10 percent, and intellectual property attorneys at 9 percent.
While litigation typically heats up during economic hard times, what's surprising in our data is that banking/finance partners rebounded with such strength (for the 2008 reporting period, banking/finance made up only 10 percent of all lateral partner moves). Also striking is that bankruptcy partners barely made a dent on the lateral market (they accounted for just 4 percent of the hires).
One explanation for the strong representation of banking/finance partners in the lateral market is that two firms (Thelen and Thacher Proffitt & Wood) with sizable finance practices imploded, and some of their partners--the lucky ones--landed at other firms. For instance, Sonnenschein Nath & Rosenthal picked up 37 Thacher partners, and Nixon Peabody gained 40 Thelen partners.
As for the dearth of bankruptcy partners in the market: They just didn't play the lateral game. They were in high demand, says New York recruiter Alisa Levin, "[but] they were too busy; they were working."
But what's most interesting is how the economic meltdown actually contributed to the vigor of the lateral market last year. Some firms saw a buyer's market and decided to go shopping in order to upgrade their talent pool.
Click here to read "Buyer's Market" in full.
Make a comment
To access the complete 2010 Lateral Report, including charts tracking the firms with the most lateral partner hires, those with the biggest losses, and moves by practice area, click here.