Law Firms

Suit claims secretive 'back-office deals' at BigLaw firm favor males in pay and origination credit

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A former female partner at LeClairRyan has filed a gender bias suit claiming the law firm favors males in partner compensation decisions that are “cloaked in secrecy.”

Former partner Michele Burke Craddock filed the suit on Wednesday in federal court in Richmond, Virginia, report Richmond Biz Sense and the Am Law Daily.

According to the suit (PDF), Craddock generated as much revenue and worked as many hours as the firm’s top male lawyers, yet most male shareholders were paid almost double what she received in salary.

The suit says the pay gap is magnified by the firm’s supplemental retirement plan, which is offered only to lawyers who make more than $350,000 annually for two consecutive years—a group that includes mostly men.

The suit claims violation of laws providing for equal pay and barring retaliation.

Craddock says most compensation and governance decisions were made by firm chair Gary LeClair, with the input of other male law firm leaders who also decided origination credit. Their decisions favored men in origination credit and work referrals, the lawsuit contends.

Justification for work referrals “has included stereotyped concerns over a male attorney’s need to support a family,” the suit says. “However, the stereotype did not apply to plaintiff when she was the breadwinner in her family.”

Originating lawyers decide which lawyers work on their matters, a self-selection practice that “perpetuates the male shareholders’ ability to reward other male attorneys,” the suit says. Male originating attorneys also bill at higher rates, while working attorneys bill at lower rates. “Often, the lowest rates are assigned to female attorneys,” the suit says.

“Although the criteria [for partner compensation] appear to provide a transparent process, the application of the policy is cloaked in secrecy,” the suit says. “As in any organization, however, information leaks out revealing subjective application of firm compensation policy, including unreported back-office deals favoring the firm’s male shareholders, including the subjective origination credits practice.”

Craddock says she was co-lead counsel on a case that paid the firm more than $20 million in contingency fees. The client had become dissatisfied with the originating attorney, and it was only through Craddock’s efforts that the client was retained, according to the suit. Yet origination credit went to the male lawyer, according to the suit.

LeClair stepped down as firm chairman on Dec. 31. Craddock worked at the firm from 2003 until March 2015.

LeClairRyan said in a statement that it views the lawsuit as groundless. “We are proud of the opportunities that women have at the firm, which has been noted by national organizations,” the statement says. It notes that the law firm is on Law360’s list of top 100 law firms for women.

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