What Firms Spent on 'Special' Bonuses | Law Firms Weigh the Cost of Cost Cutting | SoFi's Going Public: The Morning Minute
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January 12, 2021 at 06:00 AM
5 minute read
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WHAT WE'RE WATCHING
THE COST OF COST CUTTING - Last month, in our year-end Law.com Trendspotter slideshow, we called 2020 the year in which law firms "learned what they could live without," from physical office spaces to in-person meetings to certain staff functions. Still, despite the tantalizing cost-savings potential of either permanently eliminating or at least drastically shrinking those line items, the debate rages on about how much might be irrevocably lost if the industry leans too heavily into remote work, automation and outsourcing. With the financial outlook for 2021 still considerably clouded by the lingering fog of the pandemic, firms will remain on the hunt for expendable expenses this year, which will lead to a difficult question we explore in this week's Law.com Trendspotter column.: how much cost can you cut before suffering the consequences?
THE PRICE OF SUCCESS - One expense law firms definitely did not skimp on in 2020 was associate bonuses. As Law.com's Dan Packel reports, the price tag on the "special bonuses" that a number of top law firms handed out last year is likely to top $30 million for those with the largest head counts. Of course, how much that punch to the pocketbook actually hurt depended on a number of factors, including whether firms were able to offset the cost with money saved from things like canceled travel and events. Firms' associate-to-equity-partner ratios were a factor as well, of course, with the impact of 1,000 special bonus payments stinging more at a firm with 300 equity partners than at a firm with 750 equity partners. "In all things, leverage can be your best friend or your worst enemy," said Bruce MacEwan, president of consulting firm Adam Smith, Esq.
PUBLIC SOFI - Social Finance Inc. (SoFi), a financial services platform, will become a publicly-traded company by merging with a special purpose acquisition company. The transaction, announced January 7, is expected to close in early 2021. SoFi is valued at $8.65 billion and the transaction is expected to deliver up to $2.4 billion of gross proceeds to the combined company. San Francisco-based SoFi was advised by a Wachtell, Lipton, Rosen & Katz team led by partner Raaj S. Narayan, and by Goodwin Procter. Social Capital Hedosophia Holdings Corp. V, which is based in Palo Alto, California, was represented by a Skadden, Arps, Slate, Meagher & Flom team led by partners Howard Ellin and Christopher Barlow. Stay up on the latest deals with the new Law.com Radar.
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EDITOR'S PICKS
Will Service in the Trump Administration Be a Scarlet Letter in Big Law?
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Who Got The Work
Michael G. Bongiorno, Andrew Scott Dulberg and Elizabeth E. Driscoll from Wilmer Cutler Pickering Hale and Dorr have stepped in to represent Symbotic Inc., an A.I.-enabled technology platform that focuses on increasing supply chain efficiency, and other defendants in a pending shareholder derivative lawsuit. The case, filed Oct. 2 in Massachusetts District Court by the Brown Law Firm on behalf of Stephen Austen, accuses certain officers and directors of misleading investors in regard to Symbotic's potential for margin growth by failing to disclose that the company was not equipped to timely deploy its systems or manage expenses through project delays. The case, assigned to U.S. District Judge Nathaniel M. Gorton, is 1:24-cv-12522, Austen v. Cohen et al.
Who Got The Work
Edmund Polubinski and Marie Killmond of Davis Polk & Wardwell have entered appearances for data platform software development company MongoDB and other defendants in a pending shareholder derivative lawsuit. The action, filed Oct. 7 in New York Southern District Court by the Brown Law Firm, accuses the company's directors and/or officers of falsely expressing confidence in the company’s restructuring of its sales incentive plan and downplaying the severity of decreases in its upfront commitments. The case is 1:24-cv-07594, Roy v. Ittycheria et al.
Who Got The Work
Amy O. Bruchs and Kurt F. Ellison of Michael Best & Friedrich have entered appearances for Epic Systems Corp. in a pending employment discrimination lawsuit. The suit was filed Sept. 7 in Wisconsin Western District Court by Levine Eisberner LLC and Siri & Glimstad on behalf of a project manager who claims that he was wrongfully terminated after applying for a religious exemption to the defendant's COVID-19 vaccine mandate. The case, assigned to U.S. Magistrate Judge Anita Marie Boor, is 3:24-cv-00630, Secker, Nathan v. Epic Systems Corporation.
Who Got The Work
David X. Sullivan, Thomas J. Finn and Gregory A. Hall from McCarter & English have entered appearances for Sunrun Installation Services in a pending civil rights lawsuit. The complaint was filed Sept. 4 in Connecticut District Court by attorney Robert M. Berke on behalf of former employee George Edward Steins, who was arrested and charged with employing an unregistered home improvement salesperson. The complaint alleges that had Sunrun informed the Connecticut Department of Consumer Protection that the plaintiff's employment had ended in 2017 and that he no longer held Sunrun's home improvement contractor license, he would not have been hit with charges, which were dismissed in May 2024. The case, assigned to U.S. District Judge Jeffrey A. Meyer, is 3:24-cv-01423, Steins v. Sunrun, Inc. et al.
Who Got The Work
Greenberg Traurig shareholder Joshua L. Raskin has entered an appearance for boohoo.com UK Ltd. in a pending patent infringement lawsuit. The suit, filed Sept. 3 in Texas Eastern District Court by Rozier Hardt McDonough on behalf of Alto Dynamics, asserts five patents related to an online shopping platform. The case, assigned to U.S. District Judge Rodney Gilstrap, is 2:24-cv-00719, Alto Dynamics, LLC v. boohoo.com UK Limited.
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