Paul Hastings is a Los Angeles powerhouse, albeit not yet one of the so-called L.A. "Big Three," comprised of Latham & Watkins, O'Melveny & Meyers, and Gibson, Dunn & Crutcher. The firm is well known for its all-star labor and employment practice, and over the last decade the corporate practice has developed its own reputation of excellence. We'll see if the recent merger with Battle Fowler will help Paul Hastings make the Big Three a foursome.
West coast history
In 1946 friends Robert Hastings, Lee Paul and Warner Edmonds formed Paul, Hastings & Edmonds in Los Angeles. Edmonds left in 1950 to establish a practice in nearby Santa Barbara; the next year, Hastings and Paul were joined by Leonard Janofsky. The firm's last name partner, Charles Walker, joined in 1962. The employment law department, for which the firm is best known, was led at the outset by Janofsky, who later served as president of the American Bar Association. In the 1970s, Paul Hastings began moving into the Asia-Pacific region, gaining a foothold by helping Japanese clients set up U.S. operations, distribution and joint ventures. The following decade the firm opened its Tokyo office, performing M&A and financing work for clients in the region as well as picking up new Japanese, Korean, and Taiwanese clients. Back in the good old U.S.A., the firm expanded eastward beginning in the early 1980s, setting up offices in Atlanta, Washington, DC, Stamford, CT, and New York City.
In June 2000, Paul Hastings swallowed up 130 attorneys from New York real estate gurus Battle Fowler. The move greatly boosts Paul's Hasting's East Coast presence. Despite its wide reach, the firm confidently proclaims that it has the technological tools to run the entire firm on "a geography-blind basis."
No more sitting at the kiddie table
Has Paul Hastings joined the big leagues? For the past two decades, the firm has scrambled to take its place among the top firms based in Los Angeles, and in 2000, the gap seems to be closing. With nine offices and 729 lawyers, the firm stacks up, at least in terms of size, to L.A. rivals O'Melveny & Myers (752 attorneys) and Gibson, Dunn & Crutcher (749 attorneys). (All three firms have a ways to go to catch 935-lawyer Latham.) The firm certainly compares in terms of partner compensation - 1999 figures hit $675,000 in profits per partner with revenues of $285 million, up seven percent from 1998.
Corporate: stealth strength
While Paul Hastings has built its reputation on the strength of its litigators, particularly in the field of employment law, the firm's corporate department is in fact its largest. Among the firm's major corporate clients are The General Electric Company, Lend Lease Corp., and Bank of America. The firm also has close relationships with investment banks Bear Stearns, Morgan Stanley Dean Witter, and Donaldson, Lufkin & Jenrette. In November 1999, the firm represented Charter Communications in its $3.2 billion public offering, the third-largest IPO in history. The company also tapped Paul Hastings for help with its $3.6 billion high-yield financing. The firm worked on other IPOs as well in 1999, including representing Autobytel.com in its $103.5 million offering and DLJ as lead underwriter for a $90 million offering of Network Access Solutions.
Got wrongful discharge problems? Call Paul Hastings
Paul Hastings has traditionally been known as a litigator's firm - the firm's first managing partner and many subsequent managing partners have been litigators, bucking the standard law firm trend toward supposedly cool-headed corporate department heads. Notable cases for 1999 include defending client Toyota against a recall order and successfully representing Oglethorpe Power Corp. in an arbitrated contract dispute with LG&E Energy Corporation. Employment law, led by department chair Nancy Abell, remains a strength for Paul Hastings. The firm has taken on notable engagements for Hughes Aircraft as well as UPS. For the latter client, the firm negotiated a $12.14 million settlement with a group of African-American employees claiming the company had systematically denied them opportunities for advancement and extra hours.
Casting a broader net
While continuing to actively recruit at the nation's top law schools, Paul Hastings seems to be expanding the range of schools at which it recruits. In the words of one associate, "We've lately broadened our criteria for entering associates beyond the top-tier schools to look at noteworthy candidates from second-level schools." However, an insider explains that there may be ulterior motives behind this broadening of horizons. "Normally, the firm is fairly picky in a pseudo-intellectual, snotty sort of way," he notes. "Lately, however, we have become desperate enough to lower our lofty standards." Moreover, some associates worry that "the merger with Battle Fowler will further lower these standards."
As for what constitutes a "noteworthy" candidate, insiders suggest only those from the top 25 percent of their class need apply. "If you can make the grade cut-off," one contact opines, "it's not too hard to get an offer as long as you have a personality, some confidence and you act genuinely interested in the firm."
Centralized hiring process
Insiders warn that the hiring process at Paul Hastings may take longer than at other firms, as satellite offices need to go "through Los Angeles to make decisions." (The firm asserts that this is part of its effort to maintain uniform standards of quality across all of its offices.) Each on-campus recruiter makes recommendations to the firm's recruiting committee regarding final call-backs for students. Call-backs to Paul Hastings involve a half-day of interviews. Associates say that the firm is generally looking for personality fit during the interviews. "I think that we don't fly people back who don't have pretty good grades," reports one insider. "We just try not to take real jerks - we had somebody who whipped out a cell phone in the middle of an interview." The cell phone enthusiast did not get an offer. Technology enthusiasm aside, "it's a question of whether a person can handle themselves well," maintains a contact. Says one associate who has had a hand in interviewing candidates, "We're looking for leaders, so I look at what they have done in the past to try to see if they've had responsibility for running things." Another associate adds, "Paul Hastings takes very seriously performance in law school as an indicator of how well one will do in practice. However, we have hired students from schools not traditionally on our recruiting schedule if they can establish the ability to excel in other ways."
The firm's summer associate committee, which is composed mainly of associates, has the primary responsibility for coordinating the summer program. At the end of the summer, they will make recommendations to the recruiting committee based on their interaction with and knowledge of the summer associates. The recruiting committee is responsible for reviewing all work assignments and evaluations and ultimately making final offer decisions. Summer associates have an extremely high probability of receiving offers at the end of their experience. One of our contacts observes, "Of the five summer classes that have come through beginning with mine, all but one or two members each year received offers. And the 'rejections' are carefully and painfully deliberated."
Paul, Hastings, Janofsky, & Walker has nine major offices worldwide. It is not surprising, therefore, that associates report that the firm has a bit of an identity problem. Many associates claim that the firm has a distinctively Californian flair and "a fairly laid back approach. There is no intimidation factor when you start work here - people are very supportive." Others note, however, that "Paul Hastings has turned into a typical New York law firm in terms of work and hours." Another declares, "the firm is committed to being one of the top 25 firms in the country. That focus is causing a shift in culture to the New-York-big-firm style - billing hours is the focus." An insider, apparently in agreement with the previous comment, explains that Paul Hastings is "very conservative - in dress, socially, and financially."
An unwelcome side effect of the recent salary raise at Paul Hastings was a corresponding increase of the billable hours requirement to 2,000 hours (a level that the firm says remains close to the average that associates have billed historically). Moreover, an insider reports, "the firm is very clear about the 2,000 billable hours requirement. Unlike many firms, they calculate exactly how many hours per day you have to average in order to make the minimum and still get all your vacation time - and they send out reports comparing your performance to the budget." Attorneys also note that "there is an expectation that you will work harder than the minimum" - this minimum is cited as 2,100 hours. Many associates find the results of this increased pressure to bill to be overwhelming; one attorney in Atlanta cites pressure to come in on weekends to assist other overworked associates. One exasperated source grumbles, "The phrase 'work-life balance' is routinely tossed about, but I'm not real sure what it means."
Associates at Paul Hastings report widespread support staff problems. One attorney identifies support staff as "probably the area which offers the most significant room for improvement. However, the new office management recognizes this and is already putting in place incentives to attract and retain better support staff. The litigation group, although it has holes, probably enjoys the most reliable support staff." Many complain about management problems regarding staffing. "Some associates have a long wait before getting a secretary assigned to them," supplies a source. Another declares that "secretarial assignments have no rhyme or reason. One associate has his secretarial assignment on another floor."
Although the firm has succeeded in attracting female attorneys, a source observes that "the number of minorities working here is extremely low. Nothing, to my knowledge, is done to actively recruit or retain minority candidates. However, I think a minority person would feel comfortable working here." Others report that the "firm appears to be trying hard to diversify the office - but, with the exception of strong representation of Asian-Americans, it isn't reflected yet in the associate ranks." One source simply points out that "the proof is in the pudding. This firm is very white." The firm does seem to be accepting of gay attorneys. An associate reveals, "Domestic partner benefits are available. I note with pleasure that no one seems to care at all what anyone's sexual preference is." Others indicate that "there are a large number of openly gay attorneys who work at Paul Hastings." "We have several openly gay attorneys and staff. The atmosphere is open and refreshing."
Partnership prospects that rhyme with "Jim"
When questioned regarding the chance of making partner, associates at Paul Hastings reveal that prospects look "grim," "dim," and "slim." Only four attorneys were promoted to partner last year. According to associates, some events that are more probable than making partner at Paul Hastings include: "winning Powerball" "the Detroit Tigers winning the World Series during the next few years," and "getting struck by lightning." Moreover, "the of counsel position used to be used sparingly. Now it seems that the firm is making every non-lateral pay his or her dues as an of counsel before he or she can make partner. Of course, the associates have heard that the firm has instituted a non-equity status for certain partners though they haven't told us this - it figures." Some hopes remain intact. One source speculates, "Perhaps as profits per partner increase, the partners will loosen their death grip on the pie. In the meantime, the of counsel ranks are swelling. This firm is truly approaching a diamond structure."
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