Technology

Can You Really Make Money Banking Your Practice On The Next Big Thing?

Lawyer pioneers are few and far between. How do they make it?

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Generally speaking, when a lawyer talks to me about striking out on their own to pursue the next big thing, I take it with several bags of salt. “I’m going to be a Bitcoin lawyer!” Oh really? Yeah, good for you. See you at the eDiscovery vendor as a doc reviewer in a couple of months.

And it pains me a bit to be so dismissive of risk-taking because the legal profession is already too full of the risk averse. On the other hand, the law is a service industry. Entrepreneurs can strike out and build a product the world didn’t even know it needed, but lawyers are really limited to what their clients are asking about. Maybe in a few years this bold strategy will pay off, but can you make it that long? And if you can, will you be able to stave off the established firms that rush into the space when it’s suddenly in demand?

However, if lawyers are really prepared for the struggle to get a hot niche off the ground, there are success stories. Take the cybersecurity area for example. Despite movies like Sneakers glorifying hacking into banks 25 years ago, most people — and by extension, most potential clients — remained blissfully ignorant of the legal issues surrounding cybersecurity until very recently. In a new piece in Legaltech News, Rhys Dipshan talks to lawyers making money in cyber. It’s an interesting look at the different avenues lawyers can take to make money in this area, but a recurring theme of the piece is the number of accomplished practitioners who made the leap into the space long before it was cool. How they managed to make it is the hidden gem of the article.

Lesson 1 — New Is Old Again:

A decade ago, when Jay Edelson decided to launch his eponymous privacy-focused law firm, his colleagues were less than encouraging. “We heard a lot of people telling us, ‘You really shouldn’t do this, you guys are going to fail because no one cares about privacy,’” he recounts. But Edelson was confident in what he saw was a legal reckoning on the horizon. “We just viewed the world differently,” he says. “We thought there was no way the courts wouldn’t come to the conclusion that people needed to have some control over their private data.”

Note that Edelson isn’t saying that he was drawn to an emerging issue, he was drawn to his own legal analysis that the courts would treat this new problem with old tools. The key to his practice is that it wasn’t really a risk. The courts protect privacy — once a lawyer can demystify the techno babble, that’s all plaintiffs’ side cybersecurity work amounts to. If a lawyer hopes to chase a new trend, make sure there’s a sound, old-law justification.

Lesson 2 — Follow The Government, It Always Knows

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Of course, it helps that when Gottshall was an attorney at Hogan & Hartson (which later merged with Lovells to become Hogan Lovells), she worked alongside former Federal Trade Commission (FTC) commissioner Christine Varney, who represented internet advertising company DoubleClick in what “was the first big privacy investigation that the FTC started looking into relating to online advertising practices,” Gottshall recalls.

Now, Gottshall is putting her experience to work as a partner of InfoLawGroup, a boutique firm that focuses on privacy and information governance matters involving advertising, technology, intellectual property and media

The caveat to the fact that the law is a service industry and can only go where the clients are is that, in a world of increasingly onerous hurdles to legal recovery, the government will generally identify new trends before citizens do. When an entity like the FTC pursues a novel theory, it’s a safe bet there will be class actions not far behind. And, inevitably, not far behind that will be the litigation-inspired prophylactic work. And it’s that work that Jordan Fischer and Rebecca Rakoski of XPAN Law Group focuses on, employing litigators’ eyes to counseling clients to avoid litigation.

Lesson 3 — If The Insurers Are Thinking About It…

John Mullen first got into the cybersecurity field nearly two decades ago, providing legal work for a friend who opened what was then one of the few cyber insurance companies around. When the industry began to expand, Mullen worked with numerous insurance companies as part of an incident response legal team managing breach responses.

But it wasn’t until 10 years later, in 2016, that Mullen turned this work into a full-fledged law firm, Mullen Coughlin. He notes that the firm, which launched with 14 attorneys and grew to 23 attorneys by October 2017, “acts as an incident response team with a caveat.”

No one is more risk averse than an insurance company, and no one has a more imaginative take on what will be the legal challenges of the future like an insurer. If a legal niche is 5 years off, an insurer started running tables on it 5 years ago. If a lawyer wants to be the expert on the cutting edge, checking in with what terrifies insurers is a good way to maximize your chances of building a successful practice.

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Now… the challenge for all the young lawyers out there is to figure out how all this fits into a Smart Dust practice.

The Data Defenders: How Firms Focused on Privacy and Security Make Their Living [Legaltech News]

HeadshotJoe Patrice is an editor at Above the Law and co-host of Thinking Like A Lawyer. Feel free to email any tips, questions, or comments. Follow him on Twitter if you’re interested in law, politics, and a healthy dose of college sports news.

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