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Sidley Austin's Going to Trial

You'd think that most large law firms would jump at the opportunity to go to trial, which would send the firm's billable hours through the roof. Of course, your firm might not be as avid if it plays the role of defendant rather than defense counsel at trial. That's the situation that Sidley Austin may soon find itself in, according to this article, Supreme Disappointment (The American Lawyer 11/1/06). The article provides an update on the EEOC's age discrimination suit against Sidley on behalf of former firm partners that Legal Blog Watch commented on previously.

By way of background, the EEOC has sued Sidley on behalf of 27 former equity partners who were demoted to "counsel" or "senior counsel" in 1999. Sidley said that the move would open the door for younger lawyers, but the EEOC still moved forward with age discrimination claims. To do so, however, the EEOC and and the former firm partners have argued that in reality, the partners were only owners of the firm in name; in actuality, they were nothing more than employees. Now that the suit moves forward, it will, according to the article, bring to the forefront:

the fundamental questions in the case, questions that have many law firms on edge: Are law firm partners covered by federal employment law? Have modern firm economics -- big in scale, hierarchical in management -- changed the traditional rule that partners are considered employers, not employees?

The litigation won't be pretty, either, predicts the article:

Like most defendants in employment cases, Sidley will try to show that it acted for nondiscriminatory reasons. Almost inevitably that will mean trashing its former partners. The various people at the hearing mentioned issues such as client complaints, low billing, and being habitually late to work. Many of the partners have left Sidley, leading Judge Zagel to envision Sidley "dropping subpoenas on various law firms."

I'm not sure whether any winners emerge in this case. For the partners to prevail, they need to show that they were employees to trigger the protection of age discrimination laws. To me, it's awfully sad that lawyers with 30 to 40 years of experience are reduced to characterizing themselves as employees. And for firms, the outcome isn't much better -- because if the demoted partners prevail, firms will be limited in the action that they can take to eliminate lawyers who aren't bringing in enough business and are draining the firm and making it difficult for younger (and impatient) associates to ascend to the top. And while some might say that the Sidley case suggests that maybe firms should return to the days of closer and more collegial partnerships where loyalty and mutual support matter at least as much as dollars, that's not the direction that large firms are taking these days.

Posted by Carolyn Elefant on November 3, 2006 at 04:11 PM | Permalink | Comments (0)


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