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|IWON : Careers : Company Profiles : Cleary, Gottlieb, Steen & Hamilton|
Cleary Gottlieb may be a big-time New York law firm - it resides comfortably among the top 10 law firms in the world by most measures. The firm views itself as distinct from its New York peers. Don't be fooled, however - beneath a "funky" image, Cleary remains large, well-connected, and focused on profits.
Founded in 1946, Cleary, Gottlieb, Steen & Hamilton is the product of a 1940s rebellion at Root, Clark, Buckner & Ballantine. Four Root lawyers - George Cleary, Henry Friendly, Leo Gottlieb, and Mel Steen - bolted from their "roots" after their parent firm set up a partner compensation system based on hours billed and clients ensnared. The group felt that the noble work of law should be built around the principles of cooperation and that setting up a system in which lawyers would compete against others at the same firm was simply wrong. So they started their own firm, where associates and partners would be compensated by seniority alone. Some of Cleary's founders went on to achieve tremendous prominence: Henry J. Friendly, for example, became one of the Second Circuit's most famous judges, and George W. Ball became Undersecretary of State and Ambassador to the United Nations. The upstart firm got lucky early on when it acquired Salomon Brothers, then just a bond trading house, as a client. As Salomon developed into a big player in the capital markets, so did Cleary.
New leadership and new titles
January 1, 2000 brought more than a new millennium to Cleary. It also brought a new man at the top - Peter Karasz, the firm's new managing partner. Karasz succeeds Ned Stiles, who had led the firm since 1988. Karasz is a corporate lawyer whose expertise is in project finance, infrastructure projects, and international M&A. Recently he has been spending much of his time working on Latin American energy projects.
Cleary's clearly concerned about retaining its top lawyers - and has a new plan and a new position to keep valuable associates. In 1999 the firm created a new position of "senior attorney," available to seventh-year attorneys who have been with the firm for two or more years. Associates reveal that those qualifying for the position can negotiate hours and pay. One source told The New York Law Journal that the job seems to be designed for people who want to work more than part-time but less than the rigorous schedule that large firms like Cleary often require.
Vive le Coca-Cola!
Cleary Gottlieb has long represented The Coca-Cola Company. In spring 1999, the firm busied itself with Coca-Cola's continuing attempts to acquire the Orangina brand from Pernod-Ricard, a French beverage company. PepsiCo, Coca-Cola's nemesis, has been fighting the acquisition for several years, particularly since PepsiCo uses the Orangina infrastructure for its own product distribution in France. Soon after the acquisition agreement between Coke and Orangina was announced in late 1997, PepsiCo filed a motion seeking to block the deal, appealing to a French law which bars mergers resulting in a single entity dominating 25 percent or more of the market. In 1998 PepsiCo successfully convinced a French court that acquiring Orangina would indeed allow Coca-Cola to dominate the French beverage market.
The last bank standing
Cleary is a self-described pioneer in the area of mortgage-backed securities and continues to be active in the formation of new asset-backed financial products. It is the principal underwriter on public offerings of mortgage-backed securities and debt for the Federal Home Loan Mortgage Corporation (Freddie Mac). The structured finance practice is especially active in France, Germany, and Latin America.
After much private debate and public scrutiny, ultraprestigious Goldman Sachs became the final major investment bank to go public in May 1999. Goldman raised a cool $3.66 billion from the IPO, selling 69 million shares of stock in the company (just over 11 percent). Cleary Gottlieb was closely involved in the IPO, serving as underwriter's counsel for Goldman. Sullivan & Cromwell, also longtime attorneys for Goldman, served as issuer's counsel.
Fighting for a scout's honor and the MoMA's art
Cleary is serving as co-counsel with the Lambda Legal Defense and Education Fund in a high-profile New Jersey case involving the right of a gay man to serve as a scout leader in the Boy Scouts. The New Jersey Supreme Court ruled that the Boy Scouts' ban on homosexuals violates New Jersey's anti-discrimination law. In a unanimous 89-page decision, the court ruled that the Boy Scouts organization qualifies as a "place of public accommodation." The Boy Scouts have appealed, and as of May 2000, the United States Supreme Court was still mulling the case.
Cleary successfully represented the New York Museum of Modern Art when Manhattan prosecutors tried to prevent the museum from returning two paintings to an Austrian foundation. Prosecutors wanted to stop the art transfer as part of their investigation into art thefts by Nazis. The museum was preparing to fulfill its contractual obligation and return the paintings to the Leopold Foundation when the heirs of two Austrian Jews claimed ownership of the paintings. MoMA argued that New York's Arts and Cultural Affairs Law provided that the paintings could not be seized. The Court of Appeals ruling in MoMA's favor came as a relief to many art institutions, who feared an adverse decision would discourage owners from exhibiting their art in New York.
Many insiders say that a "diverse or unusual" background will bolster a candidate's chances of getting hired at iconoclastic Cleary. Of course, you need good grades to get in the door. "You are doomed, even as a lateral, without sufficient A's on your transcript," a litigator reports. "In short, if you have stellar academic credentials and are good at making interesting cocktail party conversations, you'll do fine in the interviews," advises one source. Associates also say the firm puts a lot of emphasis on law review or participation with other journals. The firm is said to favor former judicial clerks. And given the firm's international bent, Cleary is especially interested in candidates with foreign language skills.
One lawyer proposes that the on-campus interviews are where Cleary makes most of its cuts. "Once you get an invite to come to the firm for a second interview, it's hard to blow it." Sources report that the firm has been increasing its summer associate classes to keep up with its increased workload - but recruitment still proves problematic, even at this top firm. "We now hire at schools where we once did not interview, and we still don't seem to get enough people in the door," laments a Cleary lawyer.
Cleary associates most often term their firm's culture "friendly." "The firm's strong rhetoric is that it values its associates, and the general personal interactions between partners and associates is completely consistent with that," one contact reports. One associate gushes, "The people are really sweet, quirky and caring." But a less-impressed corporate associate describes the firm as "disingenuously friendly." "There is a very real hierarchy based on seniority, lurking beneath the friendly exterior. Consequently, interactions often involve a strained effort at casualness that conceals the instrumental nature of workplace relationships. In short, they're very nice about asking you to cancel your vacation or spend the weekend at the printer," he explains.
Social butteflies will find a comfortable perch at Cleary. The New York office has three main outings. One is a holiday party, which takes place either at Cleary or at a restaurant like the elegant Windows on the World. The entire firm is invited to the party, but dates are only allowed when it is held at the firm's offices. In March Cleary has a firmwide event at Wranglers, intended to introduce new associates to the firm. "Mild hazing takes place then," a source says. "Partners and associates will be made fun of. New associates will have to stand up and introduce themselves." Shy associates should practice public speaking in advance.
Psst! We've got your next assignment right here!
Cleary, for better or for worst, is a decentralized organization, and associates have great latitude to move between practice areas. There are no rotations, allowing associates to either specialize early or remain a generalist for some time. "People are free to whatever work is in the office," explains one associate. Another lawyer elaborates, "Each associate is responsible for managing and arranging his docket. Partners in need of staffing a team call around to see who is available. It is within each associate's discretion to say yes or no."
Wine and cheese
Many insiders count their fellow associates as one of Cleary's best selling points. "Associates talk to each other a lot at work and, if they have time, have lunch or dinner together or sometimes go out after work. People are very friendly and helpful." But insiders emphasize that Cleary is not party central. An associate in the Washington office claims, "People are very friendly, but it is definitely a 'geek' firm. Lots of value hung on intellectualism and very little on social skills." Associates can find colleagues at Cleary to hang out with after work. But one insider claims, "Some associates spontaneously get together, but most associates have no time for such frivolities as a social life or dating, intrafirm or otherwise." The New York office sponsors wine and cheese parties every Friday. These social events are reportedly well attended, but one lawyer believes them to be "a thinly veiled way to identify the few associates who do not yet have weekend assignments."
Better late than never?
Cleary has remained competitive in the law firm salary wars. The firm has a lockstep compensation system and no merit-based bonuses, though the firm has paid boom year bonuses in the past. But some associates think the firm is just a "follower" when it comes to compensation. "The firm's slowness in responding to pay raises and bonuses at comparable firms is a source of frustration and anxiety for associates," an insider reports. Cleary does not claim to set the market but does assert that it was among the leaders during the last round of salary hikes.
Minorities: what the NYLJ says and what associates think
Cleary has been called a leader in diversity by The New York Law Journal, promoting two Asian partners and one Hispanic partner in 1999. Minorities have accounted for 20 percent of the firm's partners since 1992 and more than 25 percent of Cleary's associates are minorities. But some associates believe that ethnic minorities, particularly African-Americans, leave in disproportionately high numbers. "I think the firm works very hard on this. I can see, though, why African-American associates find it dismaying that there are no African-American partners," says one contact.
As Cleary as day
Despite any complaints, most Cleary insiders seems cognizant that their firm differs from other law firms in important ways. Several associates tell Vault.com they "never thought they would like a large commercial firm" but appreciate Cleary for the "freedom," "collegial atmosphere," "the opportunity to spend time in a foreign office" and "intelligent, cool and well-rounded" co-workers. "No matter how junior you are," comments one associate, "you do feel your opinion counts here."
Norma F. Cirincione
Director of Legal Personnel
Cravath, Swaine & Moore;Shearman & Sterling;Skadden, Arps, Slate, Meagher & Flom;Sullivan & Cromwell
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