Davis Polk Starts Year with Lateral Hire After Relaxing Lockstep

Davis Polk & Wardwell has hired former Buckley LLP partner Daniel Stipano, an early sign the elite firm is following through on a more aggressive lateral hiring strategy it laid out last year with its departure from strict lockstep compensation.

Stipano, a former official at the Office of the Comptroller of the Currency, is based in Washington and advises on the Bank Secrecy Act and anti-money laundering enforcement matters.

Davis Polk last year relaxed its tenure-based partner compensation system in order to more readily lure lawyers from rivals. The firm had been one of a handful of Wall Street firms who still used a rigid “lockstep” pay structure, which has been under pressure as large, highly profitable firms have bid up the price of star lawyers.

Davis Polk made its first lateral hire this year far earlier than it has in the past. In 2020, the firm’s first hire from a competitor came in August, when it brought aboard longtime Gibson Dunn & Crutcher partner D. Jarrett Arp.

Stipano spent more than 30 years at the OCC , departing in 2016 as deputy chief counsel, where he oversaw major enforcement actions. In private practice, he represents clients in state, federal, and foreign banking enforcement actions and helps establish compliance programs.

Davis Polk has a top-ranked banking and finance compliance practice, and anti-money laundering expertise could bolster that and support the firm’s white-collar investigations work.

In a statement, Davis Polk managing partner Neil Barr said Stipano’s experience will be a “tremendous asset” to the firm’s financial institutions and white-collar teams.

Davis Polk’s leading capital markets practice had a banner year in 2020, buoyed by historic levels of debt financing and initial public offerings. The firm was the first last year to provide its associates a special bonus of up to $40,000 in the fall, sparking a chain reaction of top firms matching the award.

Already one of the most profitable Big Law firms, Davis Polk partners earned on average $4.5 million in 2019, according to AmLaw data.

Many expect a surge of hiring this year by wealthy firms after the best-performing firms separated themselves even further from their smaller, less-profitable competitors during 2020.