Dewey & LeBoeuf Worker Suit Says Firings to Come Tomorrow

Dewey & LeBoeuf LLP was sued by an employee over claims the law firm will terminate workers today without giving them the notice required by federal law.

Dewey is set to fire about 450 employees without cause at its New York headquarters, according to the complaint filed yesterday in Manhattan federal court by Vittoria Conn. Workers received a termination notice on or about May 7, according to the complaint. Conn is seeking to sue on behalf of other employees at the firm.

“To know that now we’re just being swept out the door is so hurtful to me and it’s illegal,” Conn, a 55-year-old document specialist, said yesterday in a phone interview. “We have to have a softer landing.”

Dewey has lost more than a third of its partners since January amid complaints about its compensation structure and uncertainty over its finances.

The U.S. Pension Benefit Guaranty Corp. said it is taking over Dewey’s retirement plans as of today. The firm’s California offices will close by May 15, the California Recorder and the San Francisco Business Times reported yesterday.

Conn claims employees should have been given 60 days’ written notice of the mass firings under the federal Worker Adjustment and Retraining Notification Act and 90 days under New York state’s labor laws, according to the filing. She’s seeking 60 days’ pay and benefits on behalf of all the fired workers.

Angelo Kakolyris, a spokesman for Dewey, didn’t return phone calls and an e-mail yesterday seeking comment on the filing. Jack Raisner, an attorney for Conn, didn’t immediately return a phone call seeking comment.

‘In Limbo’

Dewey’s support staff was kept in the dark and “in limbo” for weeks about the firm’s decline, said Conn, who has been at Dewey since 1999. Many employees took to checking legal blogs for news on what was going on inside the firm, she said.

“It certainly wasn’t being communicated within the firm. It was anything but transparent,” Conn said. “We’ve been getting really conflicting messages with a lot of sunny optimism from the firm.”

The firm began to tell employees last week that their jobs were in jeopardy with formal notices on May 7. Even then management told employees that the firm would be “downsizing,” Conn said.

Ghost Town

The 25th floor at Dewey’s headquarters has been a ghost town for about a month, after a group of partners and associates left en masse, Conn said. The New York office has no copy center, no working fax machines and no mail room, she said. Most of the secretaries have been terminated and furniture sits wrapped in plastic on dollies in hallways, Conn said.

As of today, the firm will have no document production. Employees are expected to clear out their final belongings in boxes today, Conn said. Associates have been told their jobs will end on May 15, she said. Health benefits for support staff will expire at the end of the month, Conn said.

“If we had been told definitively you better go look we would have gone to look,” Conn said. “Everything has been so shrouded and kept from us.”

Conn, who spent yesterday working on a contact list for a Moscow partner, said her final paycheck will come on May 15 for time worked. The mother of two has been on a couple interviews in recent days but concedes she may have to take a hardship withdrawal from her retirement savings to help pay bills while she looks.

“There are so many heartbreaking stories,” she said.

PBGC Action

The PBGC announced yesterday it will take responsibility for three Dewey pension plans that cover about 1,800 people. The agency said it’s stepping in to “secure its ability to collect against the firm’s affiliates that share funding responsibility” for the plans, which are underfunded by more than $80 million, according to a statement.

PBGC will pay the shortfall up to legal limits, and has decided the plans should expire today, it said in the statement.

Dewey co-chairmen Jeffrey Kessler and Richard Shutran left May 9 to join Winston & Strawn LLP and O’Melveny & Myers LLP. The departures leave Martin Bienenstock, who runs the firm’s restructuring group, and Charles Landgraf, who runs the Washington office, in the chairman’s office. Dewey ousted the fifth member of the chairman’s office, Steven Davis, after Manhattan District Attorney Cyrus Vance Jr. began a probe into possible wrongdoing at the firm, according to an April 29 internal memo obtained by Bloomberg.

Bienenstock will take his practice to Proskauer Rose LLP, the Wall Street Journal reported today on its Law Blog, citing people familiar with the matter whom it didn’t identify. The newspaper said it wasn’t clear whether all the firm’s bankruptcy lawyers would go with Bienenstock or how they would be merged with Proskauer’s bankruptcy group.

To contact the reporters on this story: Sophia Pearson in Philadelphia at spearson3@bloomberg.net; Bob Van Voris in New York at rvanvoris@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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