The grass isn’t quite this green in the ‘new normal.’
In a piece from last month, New York Times columnist Paul Krugman wondered: Is Growth Over? One could very easily take this question, posed with respect to the broader economy, and apply it to the world of large law firms.
And what would the answer be? According to a client advisory just issued by Citi Private Bank and Hildebrandt Consulting, “Probably.”
Their analysis is gloomy, although guardedly so; we’re not talking about “the sky is falling” pronouncements. Let’s take a look at the specifics….
What does 2013 hold for the world of large law firms? Let’s look into our crystal ball.
Actually, scratch that. Making predictions is a tricky business. Sometimes we’re right — like when we predicted robust bonuses out of Cravath, based on their large partner class — but sometimes we’re wrong.
For now, let’s keep our powder dry, and instead check out historical data about hours, billing rates, and corporate legal spending. Can we gain any insight into the future by looking back over the past?
* Everybody is entitled to a competent defense. It’ll make justice possible. I’m just so thankful I don’t have to defend people like this. [CNN International]
* In other terrible rape news, make no mistake, we need more people prosecuting rapists than we need defending the few falsely accused. [Slate]
* More news that fewer people are taking the LSAT. Somebody better tell Dean Lawrence Mitchell that it’s time to fire off another op-ed. Maybe he can tell people that getting a Case Western J.D. comes with a chance to enter a drawing to attempt a half-court shot for a million bucks. [Faculty Lounge]
* If you want to put a billable hours requirement on your bonuses, things like this are bound to happen. [The Volokh Conspiracy]
* Law graduate makes fun of “sloppy” recruiters. I hope his loan officer doesn’t end up making fun of a sloppy payment schedule. [Legal Cheek]
Now that bonuses, year-end collections, and holiday parties are behind us, it is helpful to remind ourselves (early on in the new year) that it is (paying) clients that make everything possible for Biglaw firms. A few months ago, I was the fortunate recipient of some illuminating correspondence from a Biglaw refugee turned in-house counsel, offering a “customer’s” take on what is both right and wrong with the “current law firm service delivery model.” Because I truly believe in the importance of this column offering an anonymous outlet for informed discussion of Biglaw-related topics (see my posts detailing my conversations with OldSchoolPartner and Jeffrey Lowe), I offered to make my correspondent the resident In-House Insider.
Agreement was not long in coming, together with yet more astute observations about Biglaw. For our initial “discussion,” I have (similarly to how I handled the Lowe interview) added questions and some brief commentary to our Insider’s points, and share this written interview with you. The only changes I made to the Insider’s words were related to their identity, and the Insider was given the opportunity to revise their responses once I added the questions and commentary. I hope we can continue to benefit from this In-House Insider’s perspective in the future. For now, I definitely appreciate when I get contacted by Biglaw-related personalities looking to discuss the issues raised in my column, and share their thoughts with this audience. Without further ado….
* According to the Second Circuit, the long arm of the law doesn’t extend to the middle finger. You can’t just go around arresting dudes for flipping you the bird. [U.S. Second Circuit / FindLaw]
* President Obama jetted off to Hawaii before he could sign the fiscal cliff bill, so he ordered it be signed by autopen. Of course, people are losing their minds over it. [Volokh Conspiracy]
* Should we scrap the Constitution? Georgetown Law professor Louis Seidman continues to advocate for constitutional disobedience in this epic ConLaw throwdown. [HuffPost Live]
* Don’t celebrate your increase in California bar passage points yet. The state bar changed its tune, and a 40% pass rate is the new standard. That shouldn’t be hard, eh TJSL? [California Bar Journal]
* One of our former columnists, Jay Shepherd, has a great way to calculate what your actual hourly rate should be, if you don’t mind working for just pennies a day. Most lawyers would mind. [jayshep]
* For the love of God, even Gawker knows that going to law school these days is a fool’s errand, or in their own words: “IT’S A SUCKER’S BET. A CLEAR SUCKER’S BET.” Come on, stop being suckers. [Gawker]
* If you’d like to hear Dean Lawrence Mitchell of NYT op-ed fame sound off on why there isn’t a lawyer oversupply problem, and why it isn’t his job to get law students jobs, we’ve got a video for you to watch….
One of the nice things about being a Biglaw lawyer is that you’ve got some autonomy over your schedule. You know how much work you have to do, and you know when it’s due, and within those borders you can manage your own time. If you want to come in a little bit later and stay a little it later, so be it. If you want to come in super early… well, you’re probably still going to end up staying late because of some BS that happens at 4:30 p.m., but after you bill 100 hours in a week, you can probably take it really easy once your matter closes.
The point is, Biglaw lawyers have the expectation of being treated like adults when it comes to their own time management.
So it’s a little bit surprising that a Biglaw firm is treating associates in one office like little children who need to be present when attendance is taken….
It’s the most wonderful time of the year. Bull and S***. If you’re not slaving away trying to get last minute billing hours, you’re slaving away trying to support a crazed population of folks trying to meet year-end sales numbers. It has been a difficult year, at best, for business. Heck, even Apple was downgraded to neutral yesterday. So, here comes the push.
The push is to close every deal possible, no matter the amount, no matter the risk, by 11:59 p.m. on December 31. But our job is to stanch the flow of craziness, is it not? Stay with me here — I am not allowed to collect commission due to a conflict of interest, yet every dollar that boosts our revenue, and thus our numbers for Q4, goes toward the bonus pool from which I directly benefit. If our end of year numbers are strong enough, the analysts punch our ticket into the new year and my options’ value rises. I may be dense (just ask my wife), but I fail to understand the difference from a commission-based return, and a bonus- or option-based return. The end result is the same, is it not? A benefit is conferred upon me based in part on my participation in the process of my sales-side corporation. But I am expected to “push” back.
I cannot, for real reasons, as well as flippancy, express some of the nuttiness that goes on at this time of year. Risks are taken akin to jumping from the high dive toward a half-empty deep end in the hopes that the water will be there in time. And it always ends happily with a splash. But, the troubling aspect to me is this incongruent fallacy of ethics. I am ethically bound to zealously represent my corporation, and at the same time, I am representing people whose very careers are at stake. I am well aware of the order of precedence there, but practically speaking, that line becomes blurred at this time of year, and frankly, I find it to be unsettling to be forced to live a legal fiction….
The year 2012 draws to a close under decidedly moribund circumstances. It’s hard to feel a lot of holiday cheer when kids are shot to death at school and the response from nearly half the country is “I better buy some more guns.”
Still, time waits for no one, and as we approach the end of the year, “time” is always on the minds of Biglaw lawyers. How much time did you bill, and how much of that billed time can you collect? The billable hour retains its potency because it is an objective, even if imperfect, measure of a lawyer’s yearly productivity. And the annual reckoning is at hand.
The client always has more leverage but certainly, for the high-end work, the firm is calling the shots.
– Kent Zimmermann, a consultant with Zeughauser Group, commenting on the premium hourly fees charged by Biglaw attorneys in sought-after practice areas like mergers and acquisitions, corporate finance and securities, white-collar defense, and litigation.
(That’s interesting, but what were the highest and lowest rates for partners and associates in 2012? We’ve got that info, and more, after the jump.)
But enough of that. Let’s hear from the managing partner of our law firm:
Ah! Orlando in March! What a fine time and place for our annual firmwide retreat.
I want to welcome everyone to this magnificent resort, and I want to take this opportunity to say a few words about a subject that’s dear to our hearts: Billing time.
To paraphrase Sir Thomas More in “A Man For All Seasons“: “When a man [fills out his timesheets,] he is holding his own soul in his hands like water; and if he should open his fingers then — he needn’t ever hope to find himself again.”
For the junior associates in the crowd, consider this: You will, at some point, have a slow month. You’ll get nervous that the firm will punish you for not having billed enough hours. To protect yourself, you’ll be tempted to borrow from the future. You’ll think that, if you add just four hours to this month’s time, you’ll have hit your billing target. If you charge those four hours to your largest client, no one will notice that you’ve slightly padded the bill. And you’ll figure that you’ll make this up to the client in some future month; you’ll work four hours some Saturday morning that you won’t write down, so the client will come out even in the long run. “That’s not really fraud,” you’ll think, so you’ll have eased your conscience. . . .
Ed. note: The Asia Chronicles column is authored by Kinney Recruiting. Kinney has made more placements of U.S. associates, counsels and partners in Asia than any other recruiting firm in each of the past six years. You can reach them by email: [email protected].
Since late last year, things have been booming in Hong Kong / China in cap markets, especially Hong Kong IPOs. M&A deal flow has recently been getting a bit stronger as well. Although one can’t predict such things with any certainty, all signs are pointing to a banner entire 2014 for the top end US corporate and cap markets practices in Hong Kong / China. This is not really new news, as its been the feeling most in the market have had for a few months now and things continue to look good.
The head of our Asia practice, Evan Jowers, has been in Hong Kong for about 10 days a month (with trips every other month to both Shanghai and Bejing) for the past 7 months (Robert Kinney and Evan Jowers will be in Hong Kong again March 15 to 23), and spending most of his time there meeting with senior US hiring partners at just about all the major US and UK firms there, as well as prospective candidates at all associate levels and partner levels, and when in the US, Evan works Asia hours and is regularly on the phone with such persons, as our the other members of our Asia team. Our Yuliya Vinokurova is in Hong Kong every other month and Robert is there about 5 times a year as well. While we have a solid Asia team of recruiters, Evan Jowers will spend at least some time with all of our candidates for Asia position. We have had long standing relationships, and good friendships in some cases, with hiring partners and other senior US partners in Asia for 8 years now.
Are you challenged by the costs and logistics of maintaining your office, distracting you from the practice of law?
Many small firms are successfully moving part—or even all—of their practice to a virtual setting. This even includes multi-jurisdictional practice spanning several states and practice areas, although solo and small partnerships are still the largest adopters of virtual law.
Can you do the same? The new article Mobile in Practice, Virtual by Design from author Jared Correia, Esq., explores how mobile technology bring real-life benefits to a small law firm. Read this new article—the next in Thomson Reuters’ Independent Thinking series for small firms—to explore how a mobile practice:
Everyone is talking about the importance of Social Media in Corporate America. But it is relatively safe to say that most law firms and lawyers are slightly behind the social curve. Most lawyers, at minimum, use LinkedIn, for networking. Some even use Twitter for pushing out short, pithy content, while many have Blogs, where they write their little hearts out. The adage “it is better to give than to receive” is not always true though in the world of Social. In the Social World – it is best to listen, give back and engage.
Social Media is a communications tool that can deeply educate you about the needs and wants of your clients and prospects when used in conjunction social media monitoring and sharing tools.
Take this quick quiz and see if you know how to use Social to help you engage more with your clients or to better service the ones you have.