This was a Texas Lawyer piece from early 2009 concerning an interesting development at the beginning of my legal career in 1991-92, as a result of the last recession. Wait, make that three recessions ago. This explains how I ended up getting an LL.M. in London.
Past, Present and Future: Survival Stories of Lawyers
April 27, 2009
Editor’s note: These are grim times for law students and associates, with Texas firms laying off lawyers, cutting summer associate programs and deferring start dates for incoming first-year associates due to a troubled economy. So Texas Lawyer decided to talk with attorneys who have experienced tough economic times in the past and those dealing with the current fallout to put a face to what’s happening in the legal employment market.
BigTex firms have scaled back before because of economic conditions. In 1991, for instance, Dallas firm Jackson Walker asked a number of its incoming first-year associates to consider a one-year deferment in
exchange for a stipend. Two lawyers who took the firm up on that offer say it turned out to be a positive experience and helped boost their careers. But does the past offer lessons for today’s associates? We talked to a lawyer laid off from a BigTex firm
who’s hunting for a new job, as well as to a Bracewell & Giuliani associate who transferred to the New York City office when she noticed her Houston corporate practice was slowing down. Here are their stories.
Europe or Bust
Friends Paul Comeaux and Stephan Kinsella were preparing to graduate from Paul M. Hebert Law Center at Louisiana State University in 1991 and start work as first-year associates at Jackson Walker in Houston when they received a tempting offer from the firm: If they deferred their start date for a year, the firm would pay them $21,000.
While $21,000 doesn’t sound like much today — and it was only a net of $14,000 because it included a $7,000 acceptance bonus — Comeaux notes that his first-year starting salary was $55,000. That’s about a third of the current starting salaries for first-year lawyers at BigTex firms.
“They had too many lawyers coming in,” Kinsella says, noting that Jackson Walker wanted up to 15 of the incoming associates to take the deferment, and he recalls that about a dozen did.
Kinsella says he and Comeaux discussed their options, and both decided to take the deferment and use the time to get an LL.M. degree in international law from King’s College at the University of London.
“We both jointly decided to take the deal, but we were afraid for our jobs. We were afraid that if we didn’t do something productive, we didn’t know what would happen,” Comeaux recalls. “What finally made the decision for me was, ‘Do I want to be a lawyer 20 years from now, or practicing for 19 years and having spent a year in London?’ ”
After graduating from law school, Comeaux says he and Kinsella spent a month backpacking around Europe and then took classes in London from September 1991 through July 1992.
They both took out extra student loans to pay for the advanced degree. Comeaux recalls it was about $15,000.
“It was a great year. I made a lot of friends,” Comeaux says.
Both lawyers started work at Jackson Walker in the fall of 1992. Comeaux, a real estate lawyer, says he left the firm after he started dating a lawyer at Jackson Walker’s Dallas office who later became his wife. Because of the firm’s anti-nepotism policy, he took a job in 1996 at Thompson & Knight, where he is now a partner.
Kinsella also started at Jackson Walker in 1992. But after moving to Philadelphia in 1994 where his wife had a job offer and eventually working as an associate with Duane Morris there, he moved back to Houston in 1997 and opened Duane Morris’ Houston office. In 2000, after making partner at Duane Morris, Kinsella, an intellectual property attorney, became general counsel at Applied Optoelectronics Inc. in Sugar Land.
Comeaux and Kinsella each say they made the right call in 1991. Both also say they would advise lawyers facing a mandatory deferment today to take advantage of the time to improve their skills.
But Comeaux says he probably wouldn’t do the same today, because the economic conditions are different from the early 1990s recession, and many firms are suffering more than Jackson Walker did back in 1991 when too many students accepted first-year associate offers at the firm. Back then, Comeaux says, firms were feeling the pinch of a slowdown in real estate work, but other sections were busy then, which isn’t necessarily the situation today with the tepid lending and deals market.
“My advice would be [do] not take the deferral, and take the job, and work real hard. . . . It’s hard to tell whether a big law firm is going to look the same three or four years from now. It makes more sense to jump in and get the experience now,” he says.
Kinsella says, “Well, when you get the call from the firm, you kind of freak out. You have the choice: Do I start work on time and let 10 other people take the offer? Or do I take the offer and take a year off and make myself more marketable? . . . In my mind, if you can afford it, you definitely should do it, but you probably should do something to make yourself a little more marketable.”
From Maternity Leave to Layoff
When an associate with more than five years of experience took maternity leave from her BigTex firm in Dallas in September 2008, the nation’s economy didn’t prompt worries for her growing family. Just a month earlier her lawyer-husband had felt secure enough about their household finances that he had quit his job at a smaller firm and launched a solo practice.
But by November 2008, when she was still on maternity leave with her new baby and also caring for her first child, a 2-year-old, the associate heard disquieting news from the office: Associates were being asked to leave. By the time she completed her maternity leave and returned to work in January, “The environment was very different than when I had left,” recalls the associate, who requests anonymity.
On her first day back at work, colleagues told her about rumors of additional layoffs. “Several people told me that hours were being looked at very carefully,” she says.
Some of the firm’s lawyers who previously were laid off warned her, “If there is some work, you best be the first one in line to get it.”
Then, in early March, two partners from her finance and banking practice group came to her office door to tell her the firm no longer needed her services. Not entirely surprised by the layoff, the associate says, she recalls saying to the two partners: “Thank you for the information,” followed by, “Do you know of anybody who is hiring?”
She had a month’s pay coming, and the firm didn’t care if she came to the office during that month or just stayed home. She decided to go to the office because she thought it would be a good place from which to network and look for work.
As of Texas Lawyer ‘spresstime on April 23, she had finished her last day at the firm and gone to five interviews. She has no full-time, salaried job yet, but she is working part-time on an hourly basis for a solo practitioner who handles hedge fund regulatory matters, a growth practice these days.
Her story resembles that of other laid-off lawyers in Texas, where firms such as Houston’s Andrews Kurth and Dallas’ Locke Lord Bissell & Liddell, Gardere Wynne Sewell, and Winstead have sent attorneys packing over the past four months.
But long before she was laid off, the associate says she had developed a realistic view of her future at her firm, one of the largest in the state, and one which had its financial fortunes slip in 2008.
“I knew I wasn’t on the fast track for partnership,” she says. She had spent her entire career at the firm, working in the finance and banking department. She liked the transactional work and “the people in her section,” but she knew the practice historically had been slower than others at the firm.
“Through my career, we have been light on hours,” she says. “We had a lot of clients, but that doesn’t mean they send us a lot of work.”
At present, her full focus is on finding employment.
“I have two very young children, and I am the primary breadwinner, and I supply the health benefits,” she says.
The evening after her layoff, she began polishing her résumé. In the past, she had talked to headhunters who called, even though she wasn’t looking for a new job, but she says she had noticed since about January that the headhunters had stopped calling. Now she was calling them.
She also received help from soon-to-be former colleagues.
The day she was laid off, one of the partners at her firm called a friend who is a partner in another firm to ask about opportunities there for the associate. The other firm’s partner called her back the next day and said, “What are you doing right now?”
“Working,” she told him.
“No, you are not,” he replied. “You are worrying. Why don’t you come over here right away, so we can talk about a job?”
Believing she couldn’t afford to turn him down, she agreed to make the appointment, hung up the phone, then panicked.
Wearing clothes appropriate for casual Fridays, she wasn’t dressed for a job interview at a firm. She decided to improvise and popped her head into a colleague’s office to ask if she could borrow the black jacket hanging on the back of her door.
The colleague agreed and several other female co-workers, including one partner, offered to swap clothes. One took the dress shirt off her back to give to the associate, another loaned her the dress pants she was wearing and a third offered jewelry.
“There really are a lot of really great people that have helped me,” she says.
The interview did not lead to a job. Now the former associate is looking for an in-house position. She has had four interviews and has been called back for a second interview at one company. She hopes to get an offer soon.
At her interviews, she has relied on the truth.
“I have been very honest about the fact that I was laid off and why,” she says. “Just about everybody has been very receptive to that. I don’t think people have held that against me.”
Her husband, she says, has tried to pick up the slack, taking cases as a solo that he might have rejected if she hadn’t lost her job. “He is looking at everything,” she says. So is she.
In a New York Minute
Shannon Weinberg, a fourth-year associate with Bracewell & Giuliani, is a Texan who had never lived anywhere else until the economic downturn. She graduated from the University of Texas in Austin in 1997 and earned her law degree from South Texas College of Law in 2005. After graduation, she joined Bracewell’s Houston office.
But a slowdown in her corporate practice area in February made her think about creating a different future in New York City.
Mark C. Evans, Bracewell’s managing partner, says a combination of the slow times recently in Houston’s corporate practice and the still-robust work in the firm’s New York office led him to agree to Weinberg’s request that she move north.
“She had expressed an interest in moving to the people she worked with, and they were busy there and slower here. I think it’s working out very well,” he says. “Over time, she might recruit some others.”
Weinberg says she has taken a shine to the Big Apple despite the snowstorm that greeted her on her first day. The firm gave her time to study for and take the New York state bar examination and gave her a pay increase to offset Manhattan’s higher cost of living. She found a place to live easily, she says, which shows how much the financial crisis has changed the New York real estate market. She sold her car, which was useless in Manhattan, and is using firm-subsidized Metropolitan Transportation Authority tickets on the subways.
In Houston, she worked largely on transactions for public companies in the capital markets. In New York, she has kept busy with private equity acquisitions of distressed assets. “It’s extremely busy here,” she says.
Will Evans send more associates from Houston to New York? Maybe, but not immediately, he says. As it happens, the firm’s corporate practice in Houston has begun to hum again. He has found that in New York, where many local firms laid off hundreds of associates, Bracewell has attractive hiring opportunities. He says the firm recently hired a former Skadden, Arps, Slate, Meagher & Flom associate who, like Weinberg, was a fourth-year associate. But lucky for Weinberg and her big-city dreams, Evans says, there is enough work in New York to keep Weinberg and the former Skadden associate busy.