Jenner & Block is changing with the times. Known forits unique culture, Jenner clung to the single-tiered form ofpartnership longer than most of the city's large law firms, whichlong ago abandoned it in favor of a two-tiered system. At Jenner,becoming a partner meant you got the benefits the word implied -- anownership stake in the firm and a cut of the profits. You were, inlaw firm lingo, an equity partner.
Not anymore. Jenner's management committee recently voted tochange its structure to include two forms of partnership, equity andnon-equity. Young lawyers -- associates -- who used to work aboutseven years before being considered for equity partnership will nowhave to put in three more years as non-equity partners, if they makeit that far. After that, the firm will consider elevating them toequity partner. In effect, Jenner is lengthening the time it takes tobecome a full partner to about 10 years from seven.
"It's a significant change in the structure of a partnership," oneJenner partner said.
A Jenner spokesman confirmed the change, and said it "does notaffect the status of any current partner in the firm." No one who iscurrently an equity partner will lose his or her status.
The change leaves Sidley Austin Brown & Wood as the last among thecity's 10 largest law firms to have a single-tiered partnership --though there is debate about whether Sidley's arrangement is trulysingle-tiered.
According to Ward Bower of the law firm consultant company AltmanWeil Inc., some 79 percent of the country's 200 largest law firmshave multi-tiered partnerships.
"That's been a very deliberate increase over the course of thelast five to 10 years. It used to be under 50 percent," Bower said.
Two-tiered partnerships provide two principal benefits: They allowthe equity partners to make more money, and they give firms more timeto evaluate lawyers who want to be equity partners. Non-equitypartners -- sometimes called "income partners" -- bill at higherhourly rates than associates. That's more money for the equitypartners to divide among themselves. Jenner currently has 189 equitypartners out of 440 lawyers overall.
As the equity partners earn more, it becomes easier for a firm toattract top talent, Bower said. At Jenner, the average equity partnerearned $605,000 in 2003, according to rankings in American Lawyermagazine. Expect that number to go up.
"It's almost an anomaly to be a one-tier partnership these days,"said Gary D'Alessio, president of Chicago Legal Search, Ltd. "I'd beshocked if this wasn't financially motivated -- that they have to becompetitive in the marketplace."
Sidley has a one-tiered partnership, though not all partners have"full equity," a firm source said. Still, Sidley considers itselftruly one-tiered because it does not have a "second look," meaningonce a lawyer makes partner, he or she does not have to worry aboutbeing voted on again for full partnership, as under a two-tieredsystem. (The U.S. Equal Employment Opportunity Commission hasrecently alleged not all Sidley's partners had full partnershiprights, part of an age discrimination suit against the firm.)
Jenner's move is likely to cause frustration among associates, whowill now have to wait longer before grabbing the brass ring. But withfewer and fewer firms making people full partners after seven years,they won't have many alternatives.
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Kenneth Moll announced last week he was the first lawyer to file aclass-action suit against Pfizer Inc. over its Bextra painmedication. The Food and Drug Administration recently pulled Bextrafrom the market over health concerns.
Moll might not get the chance to see the case through. InFebruary, the Attorney Registration and Disciplinary Commissionrecommended his license be suspended for three months. According tothe ARDC, Moll lied to a Cook County judge while trying an earlierclass-action case. His told the judge he was heading for a "three-month honeymoon" when in fact, he was facing an earlier three-monthsuspension.
The February ruling is before the ARDC's review board. And Mollhas yet another ARDC complaint pending against him. But when reachedlast week, he did not sound worried about disciplinary troublesinterfering with the Bextra litigation.
"Kenneth B. Moll & Associates is a huge law firm," he said, andother lawyers from his shop could handle the case.
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Michael Best & Friedrich, which has endured a wave of defectionsover the past several weeks, tapped Daniel Kaufman to be the newmanaging partner of its Chicago office. Kaufman, 44, has been withthe firm 13 years.
Chicago Law reported March 7 that Michael Best was about to seelarge-scale departures, and since then more than 20 lawyers have leftthe firm. Most recently, Alan Greene left to join Hinshaw &Culbertson as a partner.
Michael Best, a prominent law firm in Wisconsin, opened itsChicago office in 1990 and built its presence here by merging with 55-lawyer Schwartz & Freeman in 2001. The recent problems arose from themerger not working out, according to Kaufman.
"Integration takes quite a while," Kaufman said. "Despiteeveryone's best efforts, it just didn't work out."
The Chicago office now has 43 lawyers, down from 72 in early Marchand 83 last year. Kaufman said Michael Best intends to grow theoffice again.
"We just signed an 11-year lease at 2 Prudential, so we obviouslyhave a long-term commitment to this market," Kaufman said. The newoffices have enough space for 55 lawyers. The firm moves in January.
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CAREER MOVES:
Marla Chernof Cohen joined Chapman and Cutler as a partner in thefirm's asset securitization group. She was previously counsel atMayer, Brown, Rowe & Maw. ... Winston & Strawn partner Anne Thar wasappointed to the Illinois Supreme Court Committee on ProfessionalResponsibility.
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