Davis Polk Nabs Cleary Tax Partner as It Grows Outside Hiring

Davis Polk & Wardwell has hired former Cleary, Gottlieb, Steen & Hamilton tax partner Corey Goodman, showing its strategy to lure outside talent after relaxing its tenure-based pay model.

Bringing aboard a tax partner also follows Davis Polk’s approach of using lateral hires to add specific expertise to practice groups. Tax implications have been a major driver of deal activity this year, with Congress debating tax code changes.

“Corey’s experience across corporate transactions—from M&A and private equity, to capital markets, finance and restructuring—will be of great value to our clients seeking the most sophisticated tax advice,” managing partner Neil Barr said in a statement.

Goodman, who works out of New York, is the second Cleary partner to join the Wall Street firm this year, following the June hire of financial crimes specialist Paul Marquardt. The firm in January brought on board a partner from Buckley LLP who formerly served as an official at the Office of the Comptroller of the Currency.

Davis Polk last year adjusted its strictly tenure-based partner compensation model, with Barr saying at the time the firm would take a more “growth-oriented” view. The lockstep model has been under pressure for years as large, highly profitable firms with flexible pay policies dole out high salaries to dislodge once-loyal partners.

The Wall Street firm in 2020 posted one of the most impressive single-year financial performances in recent Big Law history, with revenue surging 22% to nearly $1.8 billion, The American Lawyer reported. Profits per equity partner spiked by more than 40% to $6.35 million. The surge was driven by its leading capital markets and M&A practice groups.

An unusually active lateral market has followed a banner 2020 for many Big Law firms, which were busy handling record levels of debt issuing, initial public offerings, and corporate mergers and acquisitions.

The pace has not relented in 2021, causing many firms to hire swathes of junior associates and ladle lawyers with bonuses and pay increases. Davis Polk has led the charge on special bonuses, being the first to announce last year a $40,000 fall bonus.

David Schnabel, head of Davis Polk’s tax practice, said Goodman’s arrival “comes at a time when changes in the tax law and the market have placed a premium on superior tax advice.”