How Did Law Firms Fare In The First Half of 2013?
Biglaw is no longer in free fall, but things are still far from fabulous.
Biglaw is no longer in free fall, but things are still far from fabulous.
* Justice Ruth Bader Ginsburg is definitely one of our favorite judicial divas. When asked if she thought the Supreme Court’s work was art or theater, she mused, “It’s both, with a healthy dose of real life mixed in.” [New York Times] * According to the Citi Private Bank’s Law Firm Group report on the first half of the year, the legal industry should count itself lucky if it manages to meet last year’s single-digit profit growth. This “new normal” thing sucks. [Am Law Daily] * Howrey going to celebrate these “monumental” settlements with Baker & Hostetler and Citibank? The failed firm’s trustee might throw a party when he’s finally able to file a liquidation plan. [Am Law Daily] * Uncommon law marriage? A man stuck in an inheritance battle who lived with his late partner since 1995 now asks the District of Columbia to declare him common-law husband. [Wall Street Journal (sub. req.)] * The ABA’s Section of Legal Education and Admissions to the Bar proposed a major overhaul to its accreditation standards. Action, of course, likely won’t be taken until next year. [National Law Journal] * Despite the fact that these measures could help struggling graduates, law deans are at odds over the ABA’s proposed changes to tenure requirements for professors. [Capital Business / Washington Post] * “Sooner or later you’ve got to make a choice, because you need enough revenue to cover what your expenses are.” Cooley will weather the storm by introducing a massive tuition hike. [Lansing State Journal] * “How would you feel if you spent well over $100,000 on law school, only to have to spend an extra couple of thousand dollars on a course to get you to pass the bar?” You’d probably feel like everyone else. [CNBC] * Requiring porn stars to wear condoms might not be sexy, but a federal judge says it’s constitutional. Don’t worry, unlike its actresses, the adult film industry won’t go down without a fight. [Los Angeles Times]
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* Growth was “steady” for New York’s top firms, with Latham & Watkins and Skadden Arps leading the pack in terms of gross revenue — which wasn’t surprising, considering their Am Law 100 gross revenue ranking. [New York Law Journal] * Dewey know when we’ll be able to stop using this pun? Hmm, at this rate, probably never. Steve Otillar and Citi recently settled their dueling suits over the ex-D&L partner’s capital contribution loan to the failed firm. [Am Law Daily] * Cahill Gordon was supposed to investigate the Rutgers basketball scandal, but the firm cited a conflict of interest, so Skadden Arps stepped in. [Insert the joke of your choice here. I don't like or watch this sport.] [Reuters] * Surely you’ve heard about Justice Orie Melvin’s sentence by now. As it turns out, shaming a judge like you’d shame your dog online might not be enforceable… which is too bad. [Pittsburgh Post-Gazette] * When we last spoke about “controversial” commencement speakers, we didn’t bring up the fact that Nancy Pelosi would be pulling double duty at UC Davis and Baltimore. Thoughts? [National Law Journal] * She’s got a death wish: the aggravation phase of the Jodi Arias trial was postponed at the last minute yesterday, and some think it’s because of the interview she gave after the verdict was announced. [CNN]
It seems that the year is off to a rocky start. Will things get better over time?
* Right about now, the Second Circuit is wondering why authors are suing Google and crying infringement over the Internet company’s e-book project, especially since digitization could benefit so many of them. [Thomson Reuters News & Insight] * This is the end of an era of legal battles: Jeffrey Skilling, Enron’s former chief executive officer, is getting a little shaved off the top of his 24-year prison sentence thanks to a deal with the Department of Justice. He’ll be out in 2017. [CNBC] * Biglaw expected to have a slow start in 2013, but no one expected it to be this slow. The latest Citi report wasn’t exactly encouraging; on average, firms saw a 0.2% increase in revenue during the first quarter. [Am Law Daily] * In the past decade, the American Bar Association has created six task forces to explore changing the face of legal education as we know it. Funny… nothing’s really changed. [National Law Journal] * Bail for Ariel Castro, the accused Cleveland kidnapper, has been set at $8 million. “Just think of how many ribs and salsa albums could be bought with that, bro,” said Charles Ramsey. [Chicago Tribune] * Casey Anthony had a bankruptcy hearing yesterday, but that news was overshadowed because everyone cared more about the girl who wasn’t going to get away with murder. [Orlando Sentinel]
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* To those of you who celebrate it, Happy Easter! Welcome the holiday by voting in the ABA Journal’s fifth annual “Peeps in Law” contest. [ABA Journal] * If law firm brackets aren’t your thing, check out Professor Kyle Graham’s brackets for (1) law school classes and (2) law blogs. I’m thankful for ATL’s #1 seed but terrified by who we’re up against (because they’ve ripped me a new one before). [noncuratlex] * Sorry, Judge Steiner, you wuz robbed; you should have been our Judge of the Day. It’s tough to top “allegations of a sexual quid pro quo with a female lawyer and the eye-opening confiscation of carpet from [chambers] for forensic analysis.” [OC Weekly] William Shatner * “William Shatner’s Seductive Powers Don’t Create a Fiduciary Duty.” Robyn Hagan Cain explains why. [U.S. Second Circuit / FindLaw] * Citi settles securities cases for $730 million. Matt Levine is not impressed. [Dealbreaker] * And Ted Frank is incensed by Bernstein Litowitz’s nine-figure fee request. [Point of Law] * If you’re already depressed by public ignorance about the Supreme Court, don’t look at the responses to question 9 of this opinion poll. [Penn Schoen Berland] * Steven Harper — author of a new (and very good) book about the legal profession, The Lawyer Bubble (affiliate link) — offers thoughts on the billable hour in the wake of the DLA Piper overbilling allegations. [New York Times]
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* The early numbers for the Am Law 100 are in, and it looks like Husch Blackwell’s gross revenue grew by six percent in 2012 after a two-year decline. Hmm… perhaps the firm is saving money by cutting back on its rejection letter proofreaders. [Am Law Daily] * “If I can’t settle with any of those parties, I will sue them.” Howrey’s trustee, Allan Diamond, plans to sue former partners of the failed firm with a vengeance — and quite “quickly” — if they refuse to cooperate with him. [WSJ Law Blog (sub. req.)] * Speaking of bankrupt law firms, former Dewey partner Steven Otillar may proceed with his various claims against Citibank over the repayment of his $209K capital contribution loan. [Thomson Reuters News & Insight] * Anyone remember Amy McTeer, the attorney who doubled as an apparent model for “faces of meth”? She resigned from the bar after allegedly helping her boyfriend escape from jail. Classy! [National Law Journal] * Cameron Ortiz, the U.S. Attorney whose name was dragged through the mud after Aaron Swartz’s suicide, claims she intended to recommend only a six-month sentence for the deceased internet hero. [Bloomberg]
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* Come on, people, Dewey really think that it’s fair that these proposed partnership clawback settlements blame only us for the firm’s implosion? The Steves and ex-CFO Joel Sanders don’t think so. [Bloomberg] * “[E]ven if partners’ capital contributions were used to repay Dewey’s indebtedness—so what?” Well, that’s certainly one way to defend a suit alleging Citibank’s participation in a Ponzi-like scheme. [Am Law Daily] * A $280K bonus sure seems nice, but do all Supreme Court clerks choose life in Biglaw once they’ve completed their stints at the high court? As it turns out, the answer is no — some view the money as “golden handcuffs.” [Wall Street Journal] * Because nobody can ogle these crown jewels except Prince William: the royals’ potential suit against Closer magazine over topless pics of Kate Middleton has turned into full-blown privacy proceeding. [New York Times] * If you’re struggling in law school, it may be wise to take some advice from those who’ve been there before you, like SullCrom’s Rodge Cohen, the Ninth Circuit’s Chief Judge Alex Kozinski. [National Law Journal]
What does the rest of this year look like for large law firms? Not great, it seems.