Boutique Law Firms

From Biglaw to Boutique: A Moment of Truth

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Tom Wallerstein

Over the last few years, the legal market has changed dramatically. We live in a buyer’s market in which the clients hold the upper hand and can demand financial concessions from their attorneys that go beyond lower hourly rates.

This good news for clients might sound like bad news for lawyers. If lawyers can’t charge as much, they likely won’t make as much. But although greater price competition might lower revenue for some firms, it surely presents an opportunity for others. Small law firms often compete with bigger firms on price, and increased client sensitivity to legal fees can be a marketing boon to firms that can undercut their competition (with the familiar caveat, of course, that the smaller firm must be able to provide the resources and quality required by the particular matter).

The changing market invites, if not demands, lawyers to offer concessions for clients. Happily, many of the concessions have relatively little impact on the firm’s bottom line, but can garner significant goodwill with clients. For example….

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From Biglaw to Boutique: Scaling Up and Down

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Tom Wallerstein

I’ve written before about some of the challenges a small law firm faces when hiring employees. But more fundamental and difficult questions are why and when should a solo or small law shop expand by adding employees?

Like all businesses, most firms with excess demand for their services have a natural incentive to grow. A company is leaving money on the table if it is forced to turn away work because all of its lawyers are at full capacity with their billable work.

The incentive to grow might be tempered by concerns over preserving a valued culture. A small law firm might resist growth because it fears disrupting a favorable workplace environment. With each new associate hired, however, the reasons for not hiring the next associate get weaker.

The major disincentive to growth is the inability to predict future business. Litigation is especially fickle. A case might go to trial, and generate hundreds of hours of billable work, or suddenly be dismissed or settled. In litigation especially, sometimes the line between swamped and dead is razor thin.

This uncertainty makes hiring additional associates extremely risky — even if the immediate workload warrants it….

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From Biglaw to Boutique: The Bigger They Are, The Harder They Fall

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I hate to invoke a cliché, but “David versus Goliath” captures the challenge a smaller firm faces when litigating against an Am Law 200 firm. A small firm can feel like David when facing a larger firm that can bring more resources to bear on legal research, drafting motions, reviewing documents, etc.

The challenge increases when applied to clients. Many of my firm’s initial clients were startups or emerging companies with limited litigation budgets. Their adversaries often were much larger, established companies with seemingly unlimited budgets. Thus, we faced not only the challenge of litigating against brand-name firms with hundreds of attorneys, but we also initially had clients who simply could not afford to spend as much in legal fees as their well-heeled opponents.

So how can a small firm, especially representing a smaller company, effectively litigate against a proverbial army of lawyers representing a client to whom money is no object?

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Benchslapped: A Not So Fine Day for Feinberg Day

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Law is not like baseball. A lawyer cannot play for one team, make a name for himself, build a local following, and then jump ship and join the New York Yankees, only to come back next season to destroy his old teammates.

In law, once you represent a client for a significant amount of time, you can’t simply oppose them down the road, even if they are no longer your client and you now work at a new firm. Obvious, right?

Unfortunately for several former DLA Piper attorneys, something there got lost in translation. A federal judge in San Francisco booted the lawyers, now at the litigation boutique of Feinberg Day, from a patent dispute involving Toshiba and Talon Research. It turned out that the attorneys, who represented Talon Research, had logged more than 3,000 hours for Toshiba when they were still at DLA. Not good.

Let’s look more closely at our benchslap of the day…

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From Biglaw to Boutique: Growing Pains

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Everyone knows how challenging it can be for lawyers to find satisfying work in today’s economy. Employers who are looking to hire associate attorneys seem to have the upper hand because there are so many qualified candidates available.

Even with an abundance of candidates, however, hiring associates and support staff can be particularly challenging for small and boutique law firms. Although Biglaw firms are notoriously selective, in some ways they are actually less selective than their smaller counterparts.

Unfortunately for most, and fortunately for some, larger firms’ hiring is largely focused on the candidate’s objective credentials. Every firm pays lip service to its unique culture, but for junior associates your resume is often more important than your personality.

In a small or boutique firm, personality and “fit” are more important than they are in Biglaw. A small firm is more likely to have a distinct firm culture that is a reflection of its partners. The more owners, the more diffuse the personalities and culture. If nothing else, in a smaller environment you are going to be working in closer physical proximity to the other employees.

So, how can small firms find new associates who fit best?

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The New York Times Spills the Beans on the Casey Greenfield / Jeffrey Toobin Affair

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The story of the tangled relationship between Casey Greenfield, a rising star in New York legal circles, and Jeffrey Toobin, arguably the nation’s leading legal journalist, has gone mainstream. Over the long weekend, the New York Times wrote an 1,800-word story on their affair.

Actually, to be fair, the story was mainly about Casey Greenfield and her law partner, Scott Labby, launching their boutique law firm, Greenfield Labby (which has a beautifully designed website, by the way). The firm specializes in what the Times describes as “high-stakes family law,” which includes not just divorce and custody litigation, but “[c]risis management, strategic planning and contract resolution.”

The story of Greenfield and Labby launching a new small law firm is both interesting and inspiring. But, at the same time, it’s one that we’ve seen — and written — before. You can read our earlier write-up of Greenfield Labby’s launch over here.

The most interesting parts of the NYT piece concern Casey Greenfield’s affair with the then-married (and still-married) Jeff Toobin, a long-running relationship that produced a baby boy. The writer, Times reporter Robin Finn, unearthed several juicy, previously unreported details….

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From Biglaw to Boutique: Where Does the Time Go?

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For attorneys who bill by the hour, one of the less enjoyable aspects of the job is recording time. For many associates, entering time is a necessary evil done only under coercion. The process also can be fraught with pressure. Associates know that all too often their worth might be measured by their billable hours.

Of course, for big and small firms alike, we tolerate the timesheets because they are our firms’ lifeblood. Recording our time enables our firms to generate their invoices. The inherent purpose of entering our time is to generate this request for payment.

But an invoice can and should do much more, especially for a small firm or solo practice….

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From Biglaw to Boutique: ‘There’s a Practice Guide for That’

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Tom Wallerstein

This post is dedicated to William A. Rutter, who passed away last week. If you’re not a lawyer in California, you might not recognize the name. But at least in my world, Rutter is the guy who produced the invaluable and ubiquitous Rutter practice guides, covering a wide range of practice areas and procedures.

If you’re not from California, you might be more familiar with other Rutter creations, like the BAR/BRI prep course he founded, or his Gilbert Law Summaries for law students.

My firm, like most firms in California, has a series of Rutter guides on our shelves. And even though we run a virtually paperless office with Lexis, Westlaw, and other electronic research options, I still love my printed Rutter guides. We even have a joke about Rutter. Whenever a colleague questions their ability to handle a particular matter or solve a particular issue, we joke, “I’m sure there’s a Rutter Guide for that.”

The joke has a serious point, namely, that the basics of most practice areas can always be learned. And if it’s easy enough to learn a practice area, why shouldn’t a lawyer forming a solo practice or small firm become a true generalist, handling everything from family law, wills and trusts, civil, criminal, and essentially whatever walks in the door?

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Finally… A Survey for Lawyers and Law Students!

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uncle sam

...to take a survey

Later this year, Above the Law will be launching a new, expanded Career Center. The new Career Center will be a resource for students and lawyers at all stages of their careers, and in all areas of legal practice (i.e., not just Biglaw). But we can be sure that news and insight into life at firms and schools will continue to be ATL’s bread and butter. With that in mind, today we open up the ATL School & Firm Insider Survey.

I assume a common reaction will be, “What with — among others — Vault, Chambers, U.S. News, and Am Law, why the hell do we need yet another employer/school survey?” Fair enough. And yes, all of the existing surveys have their merits. All of them produce useful content for students and potential laterals.

We do believe, however, that when it comes to information, the more the merrier. Moreover, the ATL survey is distinctive in some fundamental ways, and we’re going to justify its existence….

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Morning Docket: 02.08.12

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* Extra frothy: Santorum’s trifecta of wins in Minnesota, Colorado, and Missouri has made Mitt Romney angry. Because even a guy who wins nonbinding primaries can be dangerous to a man’s campaign. [New York Times]

* Richard Holwell, the judge who presided over Rajabba the Hut’s case, will be resigning and starting a boutique firm with two partners jumping ship from Kasowitz Benson. [Thomson Reuters News & Insight]

* Joe Amendola claims that evidence is being withheld in his client’s case — evidence like the alleged victims’ phone numbers. Why does Sandusky need those? So he can call and breathe heavily into the phone? [Philadelpha Inquirer]

* Foxy Knoxy’s lawyer is appealing her slander conviction in Italy, claiming that the police “manipulated” her during questioning. You were already cleared of a murder charge, stop pushing your luck. [USA Today]

* It’s really too bad that Lindsay Lohan doesn’t employ Biglaw firms for all of her drama, because given what she’s spent on legal fees in recent years, those prized spring bonuses would assured. [Huffington Post]

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