This piece isn’t about the problems ailing Dewey & LeBoeuf, but I am interested in one aspect of the Dewey saga: its use of guaranteed income deals to recruit big name hires. Dewey is an extreme example, but the firm’s playbook reflects the extent to which lateral hiring has become a worryingly dominant force in shaping the world’s largest legal market.
Yet there is little logic in the practice. Such deals mean bringing outsiders without a direct stake in the firm’s fortunes into a business built by owner-managers. Even if the individual is a superstar – a big if – why would you ever want to base a business on such recruits? And forget the fluff stuff about collegiality, why would high performers want a guarantee? They’re selling the chance to profit from their delivery.
