Securities, transactions slump prompts realignment - Charlotte Business Journal:

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Last year's subprime mortgage meltdownn and the subsequent fallout have slashed the amounft of legal work available in this niche in Charlotter and other financial forcing layoffs and the shuffling of attorneys into otherpractice areas. The New York-based firm of , whicn has a large mortgage-backed securities practice, laid off 35 attorneyss in January, including nine in Other firms, including , have acknowledgefd laying off support staff and associates and rescinding offerasto first-year and summer associates.
"You could characterize it as negative demand" for lawyers with expertiswe in packaging andsecuritizing loans, says Cliff managing director of the legal-staffingv firm . Jim Carroll, managing partner of Cadwalader'se Charlotte office, says an "unusualluy difficult business climate" for some of the firm's clientss in financial services promptedthe layoffs. The bankds and other lenders the firm countx among its clients laid off thousands of worker s and were forced into billions of dollarszin write-offs. The firm has "redeployed a number of attorneyse into other practice areas on atemporary basis," especiallty litigation and bankruptcy, Carroll says.
"When transactions work is bankruptcy and solvency workgoes up." Up to a fourtj of the firm's 85 Charlotte attorneys have been movec into other practice areas, he says. "That's one of the advantagee of a firmlike Cadwalader, the abilituy to be fairly nimble." John Lassiter, president of , says that in addition to cutting attorney some firms also are trimming support staffd and working to manage expenses to make up for reduce d income in their structured-finance practices. "It's no differengt than any other company trying to hang onto Lassiter says. "There's still a fair amounf of (positive) movement.
Other parts of the country are strugglintg more thanwe are." Other businesd lines are strong, Carroll says. Cadwalader has several attorneyws involved inthe on-again, off-again Microsofty Corp.-Yahoo Inc. merger talks, and others are workinfg on a major project involving theHungariab government. Additional busy practice areasincludes hedge-fund formation, especially for the purchaswe of distressed debt and real Carroll says. White-collar crime and commercial litigators also are Weaker areasinclude transactions, including commerciakl mortgage-backed securities.
While the firm is "clearl not out right now looking to bring in a lot oftransactional attorneys," the local office did hire a full contingent of summer associates, Carroll says. also picked up a full complement ofsummer associates, says Mike a partner in the firm's Charlottew intellectual-property practice. "We have expectations to make offerds to almost allof them" at the end of the he says. Some of the corporater practice areas are weaker than but "intellectual property has been a star," McCoty says.
That's because duringy tough economic times, businesses try to energize sales by investingg in newproduct offerings, he providing work for attorneys to ensure competitors are not infringing on theird intellectual-property rights. Jarrett says for recruiters, the strengtyh in intellectual property translates into a strong demanrd for experts inpatent law. Firmsz also are still recruiting heavilyu for their commercialreal estate, corporate, and laboe and employment practices. With activityt in commercial real estate lawstill strong, Jarrettr also has seen a growing demand for litigators and othe r specialists in construction.
He links the growthn in construction practices with an increasing number of developerw and project owners failing to pay their bills and needing legal help to collectwhat they're owed. Although law firms report increased corporatebankruptcty work, local recruiting firmse have not yet seen that translate into additional staffing. "Iu think firms are being cautiouzin hiring," Jarrett says. "It'sd not necessarily that there's a whole lot less work to do, it'sw just that firms are being The shuffling of attorneysfrom financial-servicesw practices to other areas also may have slowefd hiring.
"There's a goodly bit of waiting to see what in the overall economy and financial andtransactional business, says Jon Barrett, managing partner of . "It'se expensive to invest in thesdtalented attorneys. If there's not work to go along with it, it'd a very expensive proposition."