BigTex


Closest thing to heaven

My fair city of Austin is notorious for being a stagnant and stale legal market for those young lawyers with the audacity to attempt to practice here. Practice groups at various firms tend to merely jump from one address along Congress to another, instead of firms actually adding to their headcounts.

The stories are legion of uber-qualified attorneys from Biglaw NYC firms and Ivy Law being turned away by the BigLaw and BigTex Austin branches because of the incredible geographical demand Austin perpetually generates. It was rare for BigTex/Law satellites to open entirely new offices in Austin–that is, until now.

It all began in early 2006 when Dechert opened its Austin office with the first group of Dewey (then Ballantine, now LeBoeuf) emigres.

In early 2007 after the shuttering of Jenkens & Gilchrist (which coincidentally, was the subject of our very first post here at the SMSB), Virginia-based Hunton & Williams reopened its Austin office with the remaining Jenkens lawyers who didn’t spin off their own boutiques or join Winstead’s ranks.

Also in 1997, the Arkansas firm of Mitchell Williams opened its doors in Austin, but only began to expand its Austin footprint in May with the acquisition of longtime Austin firm Long Burner Parks & DeLargy.

After the announced closing of the Dewey office earlier this year, the majority of the remaining Dewey alumni headed over to McKool Smith, but three found their way to King & Spalding’s new Austin branch just a few months ago.

Now, word out tonight is that several Akin & Gump lawyers, including the managing partner of the Austin office, are leaving to open Greenberg Traurig‘s Austin satellite on August 1.

While all of these office openings certainly prove the maxim that Austin firms merely trade lawyers instead of adding them, because five new firms now have an entrenched presence here in Austin, it is entirely likely that more capacity for lawyers yearning to live interesting and meaningful lives in the ATL will be created.

As long as they keep Austin Weird, they’re welcome within the City Limits.

Wouldn\'t have it any other way

* * * UPDATE * * *

Due to my own oversight, I neglected to mention the 2007 founding of Yetter & Warden’s (now Yetter, Warden & Coleman) Austin office by several former Weil appellate lawyers, including the national head of their appellate practice group, former Justice Thomas clerk and Solicitor General of Texas, Greg Coleman.

Thx to the Austin Business Journal and Tex Parte Blog

Say it aint so

Success ruins everything.

David Lat, a former AUSA and federal circuit clerk who I first began to follow in mid-2004 when he anonymously ran the Article III gossip blog, Underneath Their Robes (one of the seminal progenitors of the modern legal blog) until he was outed as the proprietor by Jeff Toobin. He went on to serve a stint editing Wonkette, and then became the founder and editor in chief of Above the Law, which has grown into the lowly law firm associate’s blogospherical check on BigLaw shenanigans.

Well, due to his success at ATL, Lat has been promoted to oversee all of ATL‘s parent company’s sites; thus reducing his ATL blogging load substantially and forcing him to:

brush my teeth, put on clothes, and schlep into an office each morning.

We here at the SMSB wish him well and curse thank him for seeding our own little degenerative blogging afflication. It’s not often that a person can create and ride a sea change in a profession, but Mr. Lat certainly has and we thank him for his diligent, entertaining, and status-quo-shattering work over these last few years.

Thx to the
BLT

In our continuing series chronicling child actors gone good, we are pleased to introduce you to Isaac Lidsky, formerly known as Barton ‘Weasel’ Wyzell (aka, the new Screech) on “Saved by the Bell: The New Class.”

At the bottom leftWow

Since then, Lidsky has gone on to graduate from Harvard College and Harvard Law School after completing a stint on the Harvard Law Review, clerk for Third Circuit Judge Thomas Ambro, and practice in the Justice Department’s Civil Division and later at Jones Day.

Henceforth, he will also be known as a SCOTUS clerk, where he will be clerking for retired Justice O’Connor during the upcoming term.

Oh, and he’s accomplished all this despite being legally blind for the past fifteen years. To donate to the vision-impairment foundation he created, go to Hope for Vision’s website.

Thx to Above the Law and the Legal Times

Too soon

I read with great sadness this weekend of former Texas Supreme Court and Dallas Court of Appeals Justice James Baker‘s passing. I got to know him only briefly, but I can vouch that his stellar reputation among those who appeared before him was well-earned. He was giant both in his jurisprudence and in the admiration he rightly enjoyed from his colleagues and peers. He will be greatly missed.

Thx to SCOTX Blog and the Houston Chronicle

The U.S. News & World Report law school rankings have long been criticized for numerous and valid reasons by people who know of what they speak (unlike myself), but I think Res Ipsa has crystalized what criteria should really be considerd when ranking law schools—if the purpose in ranking these schools is to help inform where an aspiring applicant will spend the next the three years of indentured legal servitude.

Namely, return on one’s dollar.

Most law school students could care less about most of the indices USNWR uses to rank law schools, namely the size of a school’s library, median entering GPAs or LSAT scores, per capita expenditures, or even the employment rate for graduates (because what does it matter that you have a job if that job pays far less than the amount of money you just shelled out for the privilege of securing said job). Of much more importance to most law school students is the relative assurance they have that a given law school will provide them with an education that will likely allow them to attain a positive net worth at some point in their lives.

depressing

There are only three law schools in Texas where a graduate will, on average, make more in their first year of practice than they paid in tuition for three glorious years of legal tutelage: UT, Houston, and Texas Tech.

However, I would add two columns to Res Ipsa‘s excellent comparison chart above (and if I weren’t much lazier than Res Ipsa, I’d add in Thurgood Marshall‘s numbers as well): the return ratio of these schools when you factor in room and board (which all of us know who survived law school grossly underestimates the essential “beer” portion of the “board” figure, not to mention all kinds of other significant costs like books, etc.).

hmmmmm

Taking into account room and board, nobody makes enough their first year to make up for what they expended during law school, but some schools fall so woefully low on the this list that I think the fallacy of the USNWR ranking of these schools is revealed.

what a bargain

So, according to USNWR, SMU is the second best school in Texas, but according to the modified return rate ranking, it’s one of the very worst. Same with Baylor (third best according to USNWR, sixth out of eight schools measured according to the modified return rate ranking).

However, USNWR did accurately rank UT as the best law school in Texas, and came awfully close on both Houston (third versus second) and Texas Tech (fourth versus third).

So, all hype and boosterism aside, I think one would have a pretty hard time arguing UT, Houston, and Texas Tech are not the top three law schools in the state. Conversely, it’s hard to rank either Baylor or SMU in the top three when you consider how much longer it will—on average—take a graduate to make back their law school investment.

I freely and anectdotally admit however that—hands down—the most impressive and intellectually-imposing lawyers I’ve ever worked with, against, or for were largely SMU and Baylor grads.

All this aside, it goes without saying that if you graduate in the top ten percentile, have served on a journal (or better yet, been pubished in or been selected to the executive board of said journal), you will likely be able to secure a clerkship somewhere and then go on to make oodles of money in the private sector, if so desired.

* * * MEA CULPA UPDATE * * *

Having had some time this afternoon to reflect on this morning’s rant, I think I have to temper my enthusiasm for the modified return rate metric somewhat. Namely, I don’t think that it is as indicative of the best law schools in the state as it is merely a investment-value measurement.

While I believe that average starting salaries among Texas law schools are misleading because I would posit that SMU, Houston, and South Texas‘s numbers are biased upward because most of schools’ graduates remain in either Dallas or Houston to practice, and St. Mary‘s is largely as low as it is because a large percentage of its graduates remain in San Antonio to practice, average starting salary is still probably a greater reflection of school prestige than is a return rate index.

Under my reasoning put forward earlier today, Harvard, Yale, and Stanford would all likely have much lower return rate rankings than their state school brethren, but no one could argue that these schools are not the best in their respective states, if not the country.

Thx to Res Ipsa

Wow

Res Ipsa has another great post today detailing the average starting salaries of Texas law school grads. Unsurprisingly, UT topped the list at $101,111 and Texas Wesleyan–the newest accredited law school in the state–provided the foundation for the list at $57,497.

Res Ipsa also includes a fascinating snapshot of a relative salary comparison tool from CNN Money that will help the curious decide if the grass is truly greener on the other side.

As an aside, for any of my readers that are looking to add a talented lawyer to their ranks, you should get in touch with young Mr. Benson Varghese, who runs Res Ipsa Blog and is currently a 3L at Texas Tech. Since debuting his blog in March of this year, it has consistently proven to be a fine legal read with invaluable content for the Texas Bar (of which Mr. Varghese will no doubt soon be a member).

Thx to Res Ipsa

Following up on our earlier discussions of what metric best delineates BigTex vs. MidTex, (Gross Revenue or Profits Per Partner or Revenue Per Lawyer), Tex Parte Blog injected a new contender into the fray: Profitability Index (PPP / RPL). PI measures “whether equity partners are taking home more or less than the average revenue brought into the firm.”

Below, I’ve compiled the numbers for all the BigTex and MidTex shops (in descending GR order) that are more than just single-city or single-practice outfits, or Texas satellites of BigLaw. The outliers (both high and low) for each metric are highlighted.

Laid bare

Despite the thoughtful comments of a poster over at Greedy Texas, I still adhere to the belief that BigTex is more a measure of overall size, and therefore, relative market dominance. While I can’t argue that Fulbright’s PPP, RPL, and PI indices put it much more solidly in line with most MidTex firms, I remain convinced that a firm that brings in some $300 million more than most MidTex shops can’t be labled as anything less than BigTex. I don’t think a credible argument can be made that a firm bringing in some $650 milion per year cannot provide an order of magnitude difference in capability than a firm with a third the business. Inefficient and relatively unprofitable perhaps, but Big nonetheless.

I think the best example of how, perhaps at least PI is not as instructive a measure of a firm’s relative market standing as is GR, is evidenced by comparing the PIs of Akin Gump and Kelly Hart, which on their face, are not terribly disparate (1.41 v. 1.25). However, if you look at their respective GRs, Akin Gump brought in $700 million more than did Kelly Hart during FY 2007.

Thx to Tex Parte Blog

SCOTUS superlawyer Tom Goldstein posted this hilarious sendup of the classic personal injury lawyer TV ad, only this time aimed at clients needing SCOTUS bar appellate counsel.

Thx to Tom Goldstein and AbovetheLaw

A poster over at Greedy Texas got me thinking about what the best qualitative metric of a BigTex vs. a MidTex firm is. They posit that “no one gives a crap” about gross revenue, and that Profits Per Partner (PPP) and Revenue Per Lawyer (RPL) are all that really matter.

Having examined the gross revenues numbers previously lets compare the PPP and RPL of the firms that matter most to this discussion (i.e., the firms compared last time based on gross revenue alone, and a few others that are more than just single-city shops, or Texas outposts of national/regional firms)

Quan

I noted a few of these firms as tied when their PPP and RPL were inverted and similar. All in all, a fairly surprising ranking (i.e., Winstead being closer in PPP and RPL to Kelly Hart than to, say, Thompson Knight)

However, I still am of the mind that BigTex and MidTex are more accurately terms denoting scale, a measurement for which gross revenue would seem to be the most pertinent metric. So I’d still draw the BigTex/MidTex lines according to gross revenue, but look to the PPP and RPL metrics to determine how efficient a firm is, and how rewarded one might be for their toil.

So of the four BigTex firms confirmed by gross revenue (Akin Gump, Fulbright, V&E, and Baker Botts), it looks like all but Fulbright hold up their end of the bargain on PPP and RPL as well.

Thx to Greedy Texas and the Texas Lawyer

Yee Haaa

The past few months or so have seen some truly momentous changes in the Texas appellate world, particularly as viewed from Houston.

In March, the respected appellate practice group at Mayer Brown splintered, with a portion leaving to head up the new appellate practice at Pillsbury, and another faction headlined by former SCOTUS clerks Brett Busby (Stevens, J.) and Jeff Oldham (Rehnquist, C.J.) moving to Bracewell Giuliani.

The latest addition to the Houston appellate scene is Morgan Lewis’ recent announcement that former Solicitor General Ted Cruz will be helping lead the firm’s effort to build the SCOTUS and national appellate practice from its Houston office.

Thx to SCOTX Blog and Tex Parte Blog

Not chump change

The terms, “BigTex” and “MidTex,” are thrown around a lot to indicate who the top firms in Texas are, often subjectively. Below, see the list of the highest-grossing firms in Texas during FY 2007.

Akin Gump $752 million
Fulbright $649 million
Vinson & Elkins $596 million
Baker Botts $577.7 million
Bracewell & Giuliani $293 million
Haynes and Boone $264.3 million
Andrews Kurth $251 million
Locke Liddell $244.5 million
Thompson & Knight $214.5 million
Susman Godfrey $171 million
Gardere $169.2 million
Jackson Walker $163.5 million

Clearly, the only firms that can truly be referred to as “BigTex” are Akin Gump, Fulbright, V&E, and Baker Botts, who each make multiples in excess of the next highest ranking firms.

“MidTex” then, is plainly populated by Haynes and Boone, Bracewell & Giuliani, Andrews Kurth, Locke [Lord], and Thompson & Knight.

Gardere and Jackson Walker may also be rightfully considered “MidTex” as well, but it is surprising (at least to me) that they are about a $100 million behind the other MidTex firms in revenue.

Most impressive is that Susman Godrey, while having only 85 lawyers, brings in more revenue than Gardere–which has 290 attorneys, and Jackson Walker–which has 321 lawyers. Unsurprisingly, profit-per-partner is tops once again at Susman, coming in at $3 million.

* * * UPDATE * * *

Compare the BigTex revenue numbers to that of BigLaw below and you’ll get an idea of the disparity between the two.

Wow

Thx to Res Ipsa and AbovetheLaw

Happy returns

Following up on yesterday’s post about the 2008 Baker Botts bonus structure, Greedy Texas reports that Thompson & Knight might actually best the venerable Texas partnership for years five and above:

T&K
Class Year…..Bonus at 2,000 Hours

2003………..60,000
2002………..75,000
2001………..75,000
2000………..75,000

BB
Class Year…..Bonus at 2,000 Hours

2003………..50,000
2002………..65,000
2001………..65,000
2000………..65,000

Thx to Greedy Texas

The most painfully humorous clip I’ve seen in a while.

Thx to Simple Justice

Greedy Texas is reporting a new Baker Botts bonus structure, which is a significant improvement over the former scale much derided by BigTex associates.

NEW:

Class Year…..Bonus at 2,000 Hours
2007………..0
2006………..5,000
2005………..15,000
2004………..35,000
2003………..50,000
2002………..65,000
2001………..65,000
2000………..65,000

OLD:

Old

Thx to Greedy Texas

Judge Haynes

Judge Catharina Haynes never has to worry about running for judicial office again. Yesterday, she was confirmed by the U.S. Senate (in large part due to the fervent support of Texas Senator John Cornyn) to the U.S. Court of Appeals for the Fifth Circuit.

Judge Haynes was the last remaining nominee awaiting confirmation to the 5th Cir. from the original group of three nominated by the Whitehouse.

Thx to Tex Parte Blog and Texas Appellate Law Blog

LLBL

Responding to postings at Above the Law and elsewhere, firm chair Jerry Clements confirmed today there is only one compensation structure for all Locke Lord associates.

Clements further clarified that the memo to “LLS Legacy Associates” went out only to former Locke Liddell associates because they were accustomed to receiving compensation memos in February. Moreover, she explained that the memo sent to former Lord Bissell associates in December (again in conformance with prior practice) did not contain the more extensive discussion of the firm’s new deferred compensation structure that was included in the February Locke Liddell memo because “we had not decided on it yet.”

Thx to Tex Parte Blog

DB

We heard about these layoffs yesterday, but were unsure if it merited a post. To the extent staff–and isolated associate–layoffs are a bellweather for the Texas legal market in general though, here’s the scoop.

Thx to AbovetheLaw and the Dallas Morning News

LLBL

Well, at least some of the associates at newly-constituted Locke Lord will get raises. Curiously, an internal memo from the former MP of LLS recently went out only to “Legacy LSS Associates,”–not their Lord Bissell counterparts–indicating the implementation of $160k scale raises and deferred compensation packages. The scale is as follows:

Texas
Class Base Deferred Total
2007 $ 160,000 $ – $ 160,000
2006 $ 170,000 $ – $ 170,000
2005 $ 172,500 $ 15,000 $ 187,500
2004 $ 175,000 $ 35,000 $ 210,000
2003 $ 180,000 $ 50,000 $ 230,000
2002 $ 185,000 $ 65,000 $ 250,000
2001 $ 190,000 $ 65,000 $ 255,000
2000 $ 195,000 $ 65,000 $ 260,000

Of note, this scale is identical to that announced by LLS back in September, just adjusted forward to account for ’07 grads.

Thx to AbovetheLaw

F&J

Fulbright just announced a revamped bonus structure that easily makes it one of the most lucrative shops in Texas. Below is the cribbed table from Above the Law.

Yr Base 1950 2050 2150 2250 2400 Total
1 $160,000 $0 $0 $0 $0 $0 $160,000
2 $170,000 $0 $5,000 $5,000 $5,000 $5,000 $190,000
3 $172,500 $17,500 $7,500 $7,500 $7,500 $10,000 $222,500
4 $185,000 $27,500 $7,500 $10,000 $12,500 $12,500 $255,000
5 $200,000 $32,500 $7,500 $12,500 $17,500 $17,500 $287,500
6 $210,000 $40,000 $10,000 $12,500 $17,500 $17,500 $307,500
7 $220,000 $45,000 $10,000 $15,000 $17,500 $17,500 $325,000
8 $230,000 $45,000 $10,000 $15,000 $17,500 $22,500 $340,000
9 $240,000 $45,000 $10,000 $15,000 $17,500 $22,500 $350,000
10 $245,000 $45,000 $10,000 $15,000 $17,500 $22,500 $355,000

Thx to Above the Law

B&G

It’s vexing enough just managing to stay on the right side of potential conflicts in everyday law practice, imagine trying to do the same when one of your name partners is running for the presidency.

Thx to the WSJ Law Blog and the NY Times

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