By Charles Lane
Washington Post Staff Writer
Monday, May 15, 2006
Finishing a year as a law clerk for Justice Sandra Day O'Connor in the summer of 2005, Joshua Klein had his pick of high-powered jobs. The firm he settled on, Baker & Botts, offered him a congenial atmosphere and an opportunity to get trial experience.
It didn't hurt that there was a hefty signing bonus, too. "Around $200,000" was considered "market rate," Klein says.
Now, as the current court term winds down, the justices' brilliant and industrious aides can once again expect to be wined and dined by major law firms seeking to hire them -- and to be offered bonuses near the $203,000 an associate justice earns each year on the high court, according to several lawyers familiar with Supreme Court clerk recruitment.
The "law clerk bonus," as it's known, is on the rise. It passed the $150,000 mark just two years ago. Compared with judges' salaries, which Congress refuses to bump up, the soaring clerk bonus "devalues the position of the judiciary," Justice Anthony M. Kennedy complained at a recent congressional hearing.
The clerks are benefiting from the realities of the legal marketplace. Each year, there are multiple firms and multiple jobs -- and only three dozen clerks. Law firms pursuing top-flight appellate practices in Washington and other cities will pay a premium for the ability -- and cachet -- that Supreme Court clerks bring.
"It's very competitive to recruit the very best young lawyers," says David Ogden, a partner at Wilmer Hale who is involved in the recruitment process. "The process that selects out Supreme Court clerks tends to pick who the best young lawyers are likely to be. There's a limited number of them."
"The explosion [in bonuses] happened about four or five years ago because of the prestige factor that comes with a Supreme Court clerk, and the pool is not that big," said Thomas C. Goldstein, who is starting a Supreme Court section at Akin Gump Strauss Hauer Feld.
At major Washington firms, the signing bonus comes on top of a salary of about $150,000 per year, as well as any other annual bonuses a firm pays.
The law firms' scramble for Supreme Court clerks became so intense a couple of years ago that firms began inviting the entire clerk class en masse to expensive dinner receptions. The justices, concerned about appearances, put a stop to it, according to lawyers and former clerks.
Now, each individual justice sets rules for when and how his or her clerks can get in touch with firms, though all agree that clerks may not talk to firms that have matters pending before the court.
Indeed, ex-Supreme Court clerks command big bonuses despite ethics rules strictly barring them from practicing before the Supreme Court until at least two years after their clerkships end.
"There are a lot of other matters that call for the analytical skill of Supreme Court clerks," said Ogden, who was a clerk to the late Justice Harry A. Blackmun.
Another potential pitfall for firms is that clerks' long-term goals tend to focus on academia or government, rather than big-firm practice. Although some firms have tried to impose a two-year time commitment in exchange for the bonus, lawyers say, none has succeeded, because of the clerks' market leverage.
Instead, says Donald B. Ayer of Jones Day, "It's done on good faith. . . . You pay them and you hope they'll stay." Former clerks say they adhere to an informal two-year minimum, in part because they do not want to be known for taking the money and running.
Lawyers said the bonus for a Supreme Court clerk can pay for itself if the clerk remains at the firm for a couple of years and bills clients for 2,000-plus hours, as other associates do.
From the clerks' point of view, the benefits of the bonus are obvious, though even $200,000 can evaporate quickly after taxes, student loans and a down payment on a D.C. house, former clerks say.
They note that, to some extent, the bonuses simply compensate for the two years they spent clerking at the appeals court and the Supreme Court when they could have been practicing law. Clerks at the Supreme Court earn $63,335 a year and work notoriously long hours.
"It is a lot of money, but I don't think we find [the bonus] life-changing," said Curtis Gannon, a law clerk for Justice Antonin Scalia during the 2004-2005 term who is now at Gibson, Dunn & Crutcher. "We still come to work each day. We don't have big mansions."
"I'm not aware of anyone who got a really spectacular car," said Klein, adding that he put most of his bonus in the bank.
Although a majority of law clerks in recent Supreme Court terms have opted to spend at least some time at a law firm, a significant minority each year skip the bonus and go straight into teaching or government.
"I never really thought about going to a law firm," said Orin S. Kerr, a professor at George Washington University's law school who clerked for Kennedy during the 2003-2004 term. "I'm an academic and looked forward to going back."