TURKS & BRAHMINS: Upheaval at Milbank Tweed - Wall Street's Gentlemen Take Off Their Gloves

By Ellen Joan Pollock
Simon and Schuster, New York, N.Y. $21.95, 284 pages (Including Index).

Reviewed By Jean M. H. Fergus
New York Law Journal, Thursday, October 11, 1990

Gathering at a retreat in March 1986, the partners at Milbank, Tweed, Hadley & McCloy faced a new challenge. By that time, a reluctant realization was surfacing: major changes in the firm's style of business would be necessary if Milbank was going to remain competitive. The towering obstruction-the ingrained lockstep compensation that meant that partners received their draw regardless of merit, billable hours, or rainmaking abilities-was a sensitive enough issue to spark intense debate. But, by the end of the session, the old guard was toppling and a cultural revolution took shape.

In Turks and Brahmins: Upheaval at Milbank Tweed: Wall Street's Gentlemen Take Off Their Gloves, author Ellen Joan Pollock describes the battle for the hearts and minds of Milbank. This grand old firm was held by some partners-the Brahmins-as "a little gem that needs to be polished and put in a little bag in the drawer." But, they were confronted by other lawyers-the Turks-who were convinced that only growth and client diversification would carry the firm into the next century

According to Ms. Pollock, Milbank's chief problem was, ironically, rooted in its historically success. Quite simply, that could be summed up with two names: Rockefeller and The Chase Manhattan Bank. The Rockefellers were the Chase and the bank in Milbank was "The Chase." Milbank was literally the firm that the Rockefellers and The Chase had built. In 1929, Junior Rockefeller forced a merger of his lawyers-Murray Prentice & Aldrich, which itself dated to 1866, and Milbank's firm Masten & Nichols, and from the start the operating credo was unequivocal: "what is good for Chase is good for Milbank." However, with Chase accounting for 40 percent of Mil bank's billings in 1984, concern was growing that it was time for a new vision.

Outside Milbank, the legal world was undergoing tremors of change. Milbank, in this sense. was "everyfirm." All the well-established big-stake firms were being pushed to sit up and take notice of a different concept of the law practice. As Ms. Pollock chronicles, though younger partners were equally steeped in belief in the firm's moral superiority they had a growing uneasy sense that Milbank was being left behind.

Among other things, the firm's personal relationships with the Rockefellers were lessening and the Chase was growing its own in-house legal staff with exceptional success. New concepts began to be broached to generate future business - ideas like cross-selling, alumni networking and client development.

The main advocate of these ideas was Jay Worenklein, a young Turk who voiced the unthinkable in a "growth and diversification" memorandum which, written in 1984, eventually set off the chain reaction leading to the end of the old Milbank structure. The memorandum shocked the firm. Worenklein urged the firm to diversify using its strength in banking to expand into investment banking and other financial service businesses. And to counter the dependence on Chase, he suggested that the firm grow to target size of 600 attorneys. He offered a solution to the firm's lack of an M&A practice: a merger with Wachtell, Lipton, Rosen & Katz or Cleary Gottlieb Steen & Hamilton. The latter ideas were dismissed as laughable, and the reaction to the memo was universally negative. Said one partner, "The dominant theme (of the memo) was money--money isn't all that important to me." But money was important, as it is in any business. Milbank finally had to wrestle with the question that nags all law firms: how to be in a position to offer the best advice to clients and to service their needs while practicing law in an increasingly competitive and unpredictable business world. The path Milbank chose involved streamlining management and, eventually, erasing the old lockstep compensation scheme for one that rewarded hard work and client development. Ultimately, Worenklein's memo became the firm's blueprint for the future.

Turks and Brahmins traces the movement of a firm from a traditional past to a contemporary present. In a journalistic style, Ms. Pollock reports on the firm's history and growth through candid interviews with partners. In its elicitation of forthright commentary, the book is particularly solid, and the partners themselves are revealed as especially self-confident individuals who strive to take the high road in dealing with each other, even when they disagree. It is an important book for all those involved in the legal profession and for anyone who has an interest in law practice in the '80s.

Unfortunately, the book is unsatisfying in the end for what it does not and cannot tell. For instance, the book does not provide deeper insight into the multiple forces at work in the legal business in the '80s and the underlying basis for the firm's angst. And, Ms. Pollock's account seems to have appeared too soon. The final  chapters are yet to take place, leaving the inevitable question remaining - will a quiet cultural revolution of the late 1980s meet the challenges of the 1990s and beyond. Or, in other words, will it work.

Yet, if its decision-making of the past is an indicator, there does seem to be hope. The partners of this old-line Wall Street firm are not the street fighters of some of their relatively newer rivals; values other than money and greed predominate. Even when they pull off their gloves, the members of Milbank reveal themselves as having manicured hands.


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