Legal Commentary

Survey Results--Hourly Rates Going Up

Posted on December 01, 2008
  The American Lawyer's annual survey of Managing Partners to AmLaw 200 firms (112 respondents) is out.  In light of my recent posts on the economy and hourly rate increase, two survey questions jumped out at me. What will you do with billing rates for 2009? Percentage Increase them by more than 5 percent 35% Increase them by 5 percent or less 63% Hold them flat or decrease them 3% With respect to profits per partner, in 2009 you expect: Percentage They will grow by more than 5 percent 23% They will grow by 5 percent or less...

Get Creative--Merrilyn Astin Tarlton's discussions of creativity in the practice of law

Posted on November 25, 2008

Law Practice Today Roundtable Discussion On Economy And Law Firm Response

Posted on November 24, 2008
I am humbled to be have been included as a contributor to a roundtable discussion on the economy and law practice in a time of turmoil.  The roundtable was moderated and edited by Dennis Kennedy and was published online by Law Practice Today. The contributors included Tom Collins, Bruce MacEwen, Patrick McKenna, Jordan Furlong, Ed Poll, Allison Shields, Merrilyn Astin Tarlton and Dennis Kennedy...

NPR Bashes Billable Hour

Posted on November 22, 2008
   On its November 21, 2008 broadcast, NPR's Day To Day program ran a story on the looming demise of the billable hour.  You can hear the story here.  own Nicole Auerbach is quoted at length, along with Susan Hackett, the General Counsel of Association of Corporation Counsel and Steven Williams of Corporate Executive Board...

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Slides: Troubled Economy and Alternative Fees

Posted on November 21, 2008
DuPage County Bar Association Speech Slides Many thanks to the kind people at the DuPage County Bar Association and the many attorneys who attended my presentation on "The Economy, Legal Fees and Your Future--or--Alternative Fees Will Help You Survive The Economic Downturn...

Brought To You By A Large Firm With Offices Everywhere

Posted on November 19, 2008
For the past several nights as I have been driving home, I've heard the local NPR announcer say that this programming was brought to you by "Blah, Blah & Blah, a national law firm with offices in 12 cities."  Every time I hear this, I wonder whether anyone ever hears the announcement and says "wow, that is a really unique firm and I am going to hire them...

Yes, People Really Can Be Tone Deaf

Posted on November 19, 2008
  The message of my recent posts on law firms raising hourly rates this year (here, here and here) is that the firms that raise their rates are tone deaf.  The explanations for raising rates when client law department budgets are being slashed is self-absorbed...

Walking the Client Service Walk: Client Costs

Posted on November 19, 2008
Everyone talks the client service talk.  To hear the law firms' side of things, our profession's clients are the best served group of customers in the history of service providers. Well, we know better, don't we?  Few clients (the judge that matters on this issue) believe their lawyers provide elite client service...

Legal On Ramp To Aid Laid-off Associates

Posted on November 14, 2008
My friend Paul Lippe at Legal On Ramp asked me to share this important information that may be of great interest to associates (and partners) who have become the victims of the economic downturn: At Legal OnRamp, we're concerned about the recent layoffs of associates in large firms, but also optimistic that this will give those lawyers an opportunity to adapt to the world that's emerging...

The Economy and Rate Increases: Someone Is Not Listening

Posted on November 13, 2008
Two online articles caught my eye this morning: they seem so interrelated.  In Forbes.com, the article titled "The Worst Is Not Behind Us" includes this prediction: "The prospect of a short and shallow six- to eight-month V-shaped recession is out of the window; a U-shaped 18- to 24-month recession is now a certainty, and the probability of a worse, multi-year L-shaped recession (as in Japan in the 1990s) is still small but rising...

When David Fought Goliath, David Won

Posted on November 13, 2008
"I have been skeptical that the global megafirms, in fact, provide the claimed superior service, quality or price.  Indeed, the relationship between the big law departments and big firms is often bedeviled by prickly issues relating to power, money, culture, and, ultimately, the foundational question of who controls the corporation's legal matters...

The 10% Game

Posted on November 13, 2008
"I don't care what you raise your rates to, just make sure you quote me a 10% discount." In a number of meetings I have attended recently with leaders of large firms, similar stories are being told.  The firm proposes an alternative fee and the client declines to pursue the alternative fee, instead asking for "10% off" the firm's hourly rates...

Warning to BigLaw Partners: Don't Read The November Issue of The American Lawyer

Posted on November 12, 2008
Legendary Sioux warrior Chief Crazy Horse is renowned for his exhortation "today is a good day to die."  That sentiment must have been rampant among large law firm partners when they received their November edition of The American Lawyer...

The Dream--A Step Closer

Posted on November 05, 2008
I have always tried to keep politics out of this blog.  But sometimes history overtakes events and exceptions must be made. When I was a child, I wrote a paper on Martin Luther King's "I Have A Dream" speech and through many different avenues, it keeps coming back into my life...

Sometimes Laughter Is The Best Medicine

Posted on October 31, 2008
My partner, Nicole Auerbach, the soul of Valorem, ensures that we live by the rule that while we take our clients and their problems very seriously, we can't take ourselves seriously at all.  This is the sign that welcomes us to our Conference Room...

Law Firms' Economic Model Causes Unnecessary Discovery

Posted on October 31, 2008
Discovery.  The great black hole.  The Interim Report on the Joint Project of The American College Of Trial Lawyers Task Force On Discovery and The Institute  For The Advancement Of The American Legal System contains this nugget: 64% of the respondents (member lawyers, so people who try lots of cases) say law firms' economic models encourage more discovery than is necessary...

Law Department Budgets Head South

Posted on October 31, 2008
The November 2008 issue of Inside Counsel reports that 62% or the responding law department leaders expect their law department budgets to be reduced as a result of the economic crisis. The pie is shrinking.  Your piece can shrink with it, or you can figure out how to get a bigger piece...

Chance Favors The Prepared

Posted on October 31, 2008
Last March, I wrote that unlike with every recession since World War II, we would not be able to rely on the consumer to drive the economy of this recession.  Since that post, we've seen home prices continue to tumble and the precipitous decline of net mortgage equity withdrawals (essentially, the amount of home equity borrowing by Americans), down from a range of $140 billion to $225 billion per quarter to a mere $9 billion in the second quarter...

Ten Marketing Rules For Lawyers (and these are great rules)

Posted on October 30, 2008
Matt Homann's Ten New Rules of Legal Marketing in the [non]billable hour is brilliant.  Here are my two favorites: 2.  Google tells me there are 337,000 "Full Service Law Firms” out there.  Which one was yours again? 7.  Having the scales of justice on your business card says you're a lawyer -- an old, stodgy, unimaginative, do-what-everyone-else-has-done-for-fifty-years lawyer...

More Insights On Impact Of Bad Economy On Law Firms

Posted on October 28, 2008
Check out Larry Bodine's discussion of the ACC/Serengeti study that predicts a downturn in spending on outside law firms in 2009.  Also take a look at Hildebrandt's Fall 2008 Special Client Advisory.  Those looking for good news or positive signs will be disheartened...

The Economy: What Does It Mean For Law Firms?

Posted on October 27, 2008
      Wake up and smell the coffee.     If you run a law firm, heck, if you work at a law firm, wake up and smell the coffee.  What, exactly, do you think you're going to do if the economy continues to head south (which I just wrote about)...

How Much Worse Can The Economy Get?

Posted on October 27, 2008
I ran across an article in the business section of this morning's  Chicago Sun-Times that made my blood run cold.  Columnist Terry Savage was recounting how Bert Dohmen, publisher of The Wellington Letter, predicted the current credit crisis in March 2008, saying that "[t]he enormity of this problem is beyond anything we have ever seen in financial history...

The Economy: What Does It Mean For InHouse Lawyers?

Posted on October 27, 2008
    I just wrote about how much worse the economy may get, and what it means for law firms.  I would be remiss if I didn't offer some thoughts on what the declining economy means for clients.    Let me begin my observations by recalling Einstein's definition of insanity: doing the same thing over and over, and expecting different results...

More On Law Firms Raising Their Rates In Bad Economy

Posted on October 23, 2008
As I flew from Chicago to Boston this morning, I had an opportunity to read the October issue of The American Lawyer, which fortuitously arrived yesterday.  I smiled as I read a piece labled “The Going Rate: With the economy down, will fees go up?”  Readers of this blog will know I wrote about that issue a few weeks ago...

ACC Launches Blog Addressing Fees and More

Posted on October 20, 2008
Heads-up.  I justed added a link to the Association of Corporate Counsel's new blog, InHouse ACCess (love the play on capitalization).  The authors are ACC President Fred Krebs, ACC GC and leader of the Value Challenge, Susan Hackett, Steve Bokat, Larry Salibra,  ACC Associate GC Ellen Zavian and ACC Assistant GC Nichole Opkins...

InHouse ACCess: ACC leads the drive for value

Posted on October 20, 2008
http://www.inhouseaccess.com

Fixed Fee v. Billable Hour: Washington Post article

Posted on October 20, 2008
Today's Washington Post contains an article suggesting lean times will hurt the billable hour.  The article provides some entertainment in that several lawyers are quoted defending the billable hour.  It's like being the lawyer for a mass-murderer caught in the act...

Innovative Billing Arrangements Across The Pond

Posted on October 20, 2008
Friday's Financial Times on-line version contains an interesting article on "innovative" billing arrangements, meaning, of course, arrangements not tied to hours.  The thesis of the article is that  "many law firms have also become disenchanted with hourly billing, which they feel fails to adequately reward them for the value they can create for clients...

Watch For Changes In Ratio Of Partner To Associate Hours

Posted on October 14, 2008
Market forces work in law firms, at least to an extent.  When hours become scarce, they become more valuable--more valuable, that is, to the person who records them.  Hours are not more valuable to the client who has to pay for them. Consider this from a post on law...

This American Life Explains The Economic Mess

Posted on October 10, 2008
As I write this, the Dow has just gone under 8,000, and today's Wall Street Journal notes that in the last seven days, investors have lost $8.4 trillion of wealth.   And that is only wealth lost in the market.  Home prices continue to decline in many areas as well...

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