Although the “Cravath System” has been declared dead for over a year now, this model of leadership has been on the rocks for much, much longer.
Over a century ago, millionaire lawyer Paul Drennan Cravath went out in search of the best and brightest young lawyers from the top law schools, paid them salaries, and mentored them in how to become great litigators. As an associate, you could stay at the firm as long as you were “promotable,” meaning that you had roughly eight years to make partner or you were out. The “Cravath System,” as it would eventually be called, was adopted by almost every major American law firm.
One could argue that part of the Cravath model’s destruction was due to the rise of legal technology. Yet one might also argue that legal technology will begin its rebirth.
The cracks in the Cravath system started to show in the late eighties and early nineties. Around that time, every office of every major firm was outfitted with a PC, and the birth of electronic documents began.
The age of the internet erupted during the mid-90s, and communication by email became mainstream. Because of this, American law saw the advent of e-discovery, and the cost of litigation exploded. Almost overnight, reviews for the discovery of documents were in the hundreds of thousands to millions. Highly-paid law firm associates began to supervise document reviews instead of litigating novel legal issues. Of the “best and the brightest,” fewer associates were “mentored,” making even fewer of them “promotable.” Staff and contract attorneys became more commonplace in large law firms as well.
In the aftermath of the horrific September 11th attacks, the economy soured for well over a year. In this time, however, e-discovery quickly became its own cottage industry within the law.
As the economy improved, litigation began rolling again, and Am Law 200 firms were reaping the benefits. E-discovery and legal technology were skyrocketing, leading to more document review hours that filled the firm coffers. Mergers and acquisitions work was going strong as well. In February 2005, Crowell & Moring and Arnold & Porter were part of one of the largest second requests in U.S history, the merger of SBC and AT&T. The review for this merger involved over 700 attorneys and 25 million documents.
Competition for law firm business became more intense as well. LegalTech, held at the beginning of February in New York, quickly became the largest legal technology conference in the world, followed by the International Legal Technology Association Annual Meeting (ILTA) and the ABA Techshow. Technology vendors flocked to these events, eager to do business with law firms, and struggled mightily to lower costs for their potential clients.
Meanwhile, the general counsels of the corporations paying the high costs of litigation were becoming more educated as to where their money was actually going. They soon objected to paying law firm associates $300 to $400 an hour to click through mundane electronic documents for discovery, as well as unnecessary markups for routine services like photocopying. In other words, the jig was up, and firms knew they would have to be much more careful in billing discovery projects.
In reaction, many firms scrambled to find other ways to lower costs. They utilized more staff and contract attorneys and put into place project management plans to streamline the process. Taking it to another level, law firms followed the path laid out by manufacturers and turned to overseas labor, dramatically lowering their costs by hiring legal process outsourcers for document review.
In 2008, the economy was reaching a breaking point. As readers of this blog know, many associates were shown the door. Richard Susskind, famed legal futurist and author of The End of Lawyers, states that those who embrace legal technology will succeed while those who do not will be left behind: “Above all, the theme is how technology will change our profession.”
Although Susskind purports to be an agnostic on “whether the future for lawyers could be prosperous or disastrous,” and says that “the arguments and findings of this book can support either end game,” it’s clear where his heart lies:
“I predict that lawyers who are unwilling to change their working practices and extend their range of services will, in the coming decade, struggle to survive. Meanwhile, those who embrace new technologies and novel ways of sourcing legal work are likely to trade successfully for many years yet, even if they are not occupied with the law jobs that most law schools currently anticipate for their graduates.”
So what exactly does this mean for the legal profession? In 2050, will technology have advanced to the point that all legal discovery will be done by robots or computers? As the legal profession adjusts to new trends in legal technology, law firms will certainly be comprised of fewer associates, staff and contract attorneys. But attorneys who can adapt will still be an integral part of the law. Even if technology makes it easier to find responsive documents, much of the work at the doc review level will be done by attorneys and project managers specifically trained to supervise this process.
But what about “the best and the brightest”? Ironically, with the distraction of document review out of the picture, they will have a chance to shine by working on the types of sophisticated legal issues they were supposedly hired to address in the first place. They can be mentored by senior attorneys into being great litigators after all.
With this new economy emerging, and technology in constant advancement, is the Cravath model dead — or is it just correcting itself?