Reuters: Is Big Law Paying Too Much for Star Partners?
A recent Reuters article by Sara Randazzo examines the growing willingness of elite law firms to pay $20 million or more for star lateral partners - and the data suggesting those bets don't always pay off.
The piece cites research from legal consultant Blane Prescott showing that when managing partners were asked what share of lateral hires met financial projections in their first year, the average answer was just 20%, rising to only 30% by year two. Separate data from legal intelligence firm Decipher found that 51% of new-partner hires leave within five years, and 64% fail to deliver the business they promised.
Naomi Kaplan, a Managing Director in the Macrae West Coast US team, comments in the piece on how compensation-setting has shifted:
"The rules are just flying out the window."
The article traces how record levels of partner movement - more than 2,000 lateral moves between the 200 highest-grossing US firms in the first half of the year alone - are colliding with surging firm revenues, pushing top-end pay ever higher even as firms' own data raises questions about the return on those investments.