A True Story
Carl graduated from law school in the mid-1970s and went directly to work for the General Counsel’s office of thriving and highly profitable Carborundum Corporation in Niagara Falls, New York. It was something of a dream job. It was very rare for a new law grad to go directly into a large company’s in-house counsel office without a few years of seasoning in a major law firm. Carl felt like he had won the lottery.
Three years later, Carborundum was acquired by Kennecott Copper, an even larger company with its own in-house counsel office. The majority of Carborundum’s lawyers were let go, but Carl survived. He and his family had to move to Kennecott’s Stamford, Connecticut headquarters, a huge disruption to his family made more stressful by a considerably higher cost of living. Nevertheless, Carl was optimistic about his future with one of the largest resource companies in the world. What he did not know and had not researched was that Kennecott was experiencing financial problems.
Four years after Kennecott acquired Carborundum, Kennecott itself was acquired by Standard Oil of Ohio (Sohio). Once again, the majority of the acquired company’s legal staff was let go. Carl once again survived (barely). For the second time in just a few years, he had to uproot his family and move, this time to Cleveland, Ohio.
Three years later, Sohio was acquired by British Petroleum. This time Carl was not so fortunate. Ten years out of law school, he was out of a job.
Merger Mania and Its Discontents
If anything, this story of how a series of presumably “apex” corporate predators took over smaller (but still very large) companies was an ominous portent of the stürm und drang that has roiled the legal world ever since and continues to do so today. The bottom line is that there are no companies too big to be acquired. And that means that no corporate legal job is safe.
Moreover, that same precept applies to organizations other than commercial corporations. Mergers among the largest law firms occur with increasing frequency. There were a record 102 in 2017 alone. According to Altman Weil, a legal consultancy, we can expect to see a continuation of the frenzied rate of law firm mergers moving forward.
Even nonprofits have become part of the merger mania. Some of the largest trade and professional associations have joined together in recent years.
The significance of all of this M & A activity for legal careers—and career planning—is profound. When two organizations unite, one of the compelling reasons for the combination is to save on back office and support operations. Legal staffs fall within those definitions. It is typically the case that a union of two organizations means that fewer attorneys will be needed.
Some Fall-Back Pointers
Don’t Assume Government Will Always Be There For You
In such a volatile environment, it is essential that you have a fall-back position, one that you have thoroughly researched and strategized. It is not enough to assume, as so many disappointed lawyers who viewed themselves as “high-flyers” did when the Great Recession hit, that there would always be a government agency eager for their services. That proved not to be the case for four reasons: (1) static government hiring, a truism now decades old, along with intermittent hiring freezes prompted by budgetary constraints; (2) a sense shared by many government legal hiring officials that attorneys with BigLaw or Fortune 1,000 in-house experience viewed lower-paying government jobs as mere temporary way-stations until they could move back into the private sector; (3) hiring officials’ conviction that private sector attorneys would quickly become disgruntled “problem” employees when they saw their first government paycheck; and (4) the “intimidation” factor, i.e., a reluctance to hire individuals with much better resumes than the hiring official.
Be Realistic About Pay Expectations
Experience tells us that attorneys abruptly terminated due to an acquisition are likely to see a reduction in their compensation in their next job. Reality often hits hard. In planning a fall-back position, it is important to factor this reality into your budgetary planning.
Document Your Transferable Skills
Do not assume that because you have spent your career in one practice area, that this focus limits you in seeking your next job. If you have, for example, mastered a highly complex discipline like securities law, make sure that your resume and networking contacts understand that the ability to master such a complex regulatory scheme means that you can come up the learning curve quickly with respect to other complex areas of law.
Expand Your Horizons
Don’t overlook the possibility of parlaying your experience and skill sets into a “JD Advantage” job/career where a law degree and legal experience might translate very well into a law-related area.