Lawyers Journal

Steady salaries, strategic growth help firms ride out rough economy

By December 2001, the recession had hit New England, a result of the economy's cyclical downturn compounded by the aftermath of the Sept. 11 terrorist attacks. The region's information-technology, manufacturing, financial and biotechnology industries all saw declines in job growth, giving Massachusetts and neighboring states an unemployment rate below the national average.

Economists predict that New England's recovery will lag behind the nation's by one or two quarters, but some Massachusetts law firms already are seeing signs of a rebound.

The legal community in the commonwealth has been proceeding cautiously, however, closely watching the flow of business in all practice areas and adjusting their market plans accordingly. Firms that did not increase their starting salaries during the economic boom of 2000, for the most part, have remained fiscally stable.

Mirick, O'Connell, DeMallie & Lougee in Worcester was one firm that maintained a steady salary line during the boom and despite the recession.
"Sept. 11 had an effect, but we still haven't implemented a hiring or salary freeze. It's business as usual," said Paul Carey, partner of the medium-sized firm.

Large firms that saw a decrease in business for certain departments compensated in other areas and also managed to maintain salary levels.

The corporate and venture capital departments at Boston's Edwards & Angell, for instance, did not reach the same levels of activity in 2001 as the previous year, but the firm did not have to adjust its salary scale to accommodate the shift. According to Lee Slap, managing partner, litigation remained stable and the insurance and reinsurance areas grew "exponentially" during that time. By the end of 2001, business had "picked up significantly" again in the corporate and venture capital departments, Slap said.

Even though two senior associates left Edward & Angell's corporate department partly for economic reasons, Slap said the firm has been able to derive stability from its size - 300 attorneys in seven cities - and its approach to salaries.

"We are more of a believer of 'moderate salary and reward performers at bonus time'," said Slap. "We don't aspire to pay first years $150,000. [For a good] quality of life, we [don't think] we have to be top payers."

Burns & Levinson is another Boston firm that experienced a decrease in business for certain areas, notably the corporate, real estate and tax-law departments. Managing partner David Rosenblatt said business is regaining strength. Like Edwards & Angell, Rosenblatt's firm maintains a moderate pay scale.

Growth field

Decreased or steady business was not the only news of the recession, however. One practice area that appears to be "recession proof" across the state is intellectual property.

Boston's Fish & Richardson, for example, not only has excelled in this area despite the rough economy but has been able to offer signing bonuses for newly recruited patent attorneys.

Referring to his firm as an "exception here in Boston," principal Alan Smith of Fish & Richardson said the technology market has caused "quite a stir in the legal arena," particularly for lateral associates. The 80-attorney firm has 10 technology specialists.

Its largest practice area, patent prosecution, involves drafting patent applications and filing them with the Patent and Trademark Office in Washington, D.C. According to associate Craig Smith, there has been a steady increase in work during the past six to eight months for patent and trademark lawyers.

"I don't think the intellectual property field was hit by the recent recession," said Smith. "We're giving a special bonus for those with computer science and engineering background: $50,000 to $75,000 per person."

For associates in this growing department, such as attorney Lee Crews, who has combined a PhD in physiology with jurist doctorate, working in intellectual property means being insulated from changes in the economy.

"I personally don't feel any effects of the recession," Crews said. "We're actively recruiting and very busy.

"There has been no downsizing and they never cut people," she said, adding that the only staff changes in her department have been to replace attorneys who have left to work in-house for large local companies such as Biogen Inc. and Millennium Pharmaceutical, Inc.

For the time being, she has found a niche.

Trained as a scientist, Crews was a medical researcher for years, but found it was not her calling and sought other avenues. She decided to shift her focus to reading, writing and interacting with clients after meeting a patent lawyer.

"It never crossed my mind to do [law]," Crews said. "I never knew cancer research could lead to law. It's very nice to be able to use my technical training."

Crews finds her responsibilities intense due to clients' demands and the strict deadlines set by the patent office, but she continues to learn on the job and has the firm's resources for support and guidance. Her work involves defending new methods of medical treatment for disease, such as cancer and AIDS, which need ongoing attention despite economic shifts.

"We get involved early on in the process and file at an early stage. Some clients have [inventions] that have proven safe and efficacious in clinical trials," she said. "I don't feel I'm saving lives. I'm helping people who help save lives by attracting investors."

At Boston's Hale & Dorr intellectual property also is thriving. In 2001, the department grew 60 percent. Although the firm continues to hire in that area, managing partner William Lee said it won't grow "quite so quickly" in 2002.
According to Tony Merinda, hiring partner of Foley Hoag, intellectual property has been growing strong for years because "the value of a company is in its idea."

Despite the recession, his firm's patent and trademark law departments also grew in the past year, and salaries remained stable.

"When times get tough and there's conflict, people fight hard to protect the idea," Merinda said.

Other departments that depend on the financial markets, most notably through initial public offerings, were harder hit by the economy.

Merinda said even those areas are now starting to show signs of coming back, as indicated by recent increased investments for venture-capital funds. "Short term ups and downs of the economy," he said, "don't cause us to make changes."

©2014 Massachusetts Bar Association