TechnoLawyer: Law Office Management

Originally published on March 16, 2009 in our free BigLaw newsletter.

Yankees v. Red Sox. Montagues v. Capulets. Obi-Wan v. Darth Vader. Bitter rivalries, all of them, and all of them fought outside the confines of law firms. But what happens when turf wars take place behind the swank mahogany doors of the world's top law firms? Who's caught in the crossfire when partners duel?

A Group By Another Name That Does the Same Work

Before hiring laterals went the way of the Dodo bird, "Doug" secured an interview with a top New York law firm whose Employee Benefits practice was supposedly larger and more diverse than that of the large firm where he then worked as a fourth year associate.

When Doug logged onto the prospective firm's Web site to prepare for his interview, he found that two practice groups at the firm dealt with Employee Benefits: the Executive Compensation & Employee Benefits group handled compensation arrangements, the benefits aspect of M&A deals, and pension plans, whereas the Labor, Employment & ERISA group handled compensation arrangements, the benefits aspect of M&A deals, and pension plans. Oh, and the latter group handled labor issues, too.

Doug first assumed that the two practices were actually the same, but each had a separate Web page and listed different sets of attorneys associated with each group. He was slated to interview with attorneys from Executive Compensation & Employee Benefits only.

Confused, he emailed a friend who was an associate at the firm for clarification.

The response: "Partner Wars."

Dueling Partners, Dueling Practices

At the interview, Doug asked a senior associate, "Kara," to elaborate on the difference between the two groups and whether they worked in tandem on matters. Kara got up, shut the door to her office, and returned to her chair.

According to firm legend, she explained, there was once a single Executive Compensation/Employee Benefits/Labor/ERISA group. However, the group's two senior partners so hated each other that they split the kingdom and forged separate fiefdoms that continue to perform very similar work. So no, they didn't work in tandem. Associates work for one group or the other; dual citizenship is not permitted.

Doug then asked whether she found the dueling practice group system odd or problematic.

Kara morbidly analogized the situation to a treatment for epilepsy in which the brain tissue that connects the right and left hemispheres is severed. The Executive Comp people never know what the Labor people are working on, and vice versa. This disconnect results in the groups occasionally duplicating each others' efforts.

But duplicating efforts is the least of dueling groups' problems. Kara noted that the split becomes truly nightmarish when the general corporate associates cannot figure out which Executive Comp or Labor associate is working on which deal.

She recalled an incident in which a livid client called about poorly drafted employment agreements from a deal that closed several months prior. It turned out the corporate associates drafted the agreements themselves out of desperation, after failing to determine which Executive Comp or Labor associate was staffed on the matter. All the agreements had to be amended and re-executed. The most humiliating part of it all, said Kara, was explaining the mix-up to the client.

Law Firm Fiefdoms Are Bad for Business

Impressing potential hires may not be the primary concern of law firms, but as Doug's story demonstrates, partner turf wars can affect more than just office politics.

Firms plagued by dueling practice groups or partner grudge matches — even rifts less dramatic than the one described above — are at a significant disadvantage compared to their drama-free peers. Among the many downsides — reduced efficiency and higher bills, which may help the firm in the short run, but clients will eventually realize that they're not receiving the highest caliber at a reasonable cost.

Of course, clients aren't the only ones that suffer. Associates forced to choose sides between partners lose potential mentors and cannot benefit from the experience and expertise of the entire partnership. Associates with truncated skill sets ultimately hurt the firm.

Consequently, now, perhaps more than ever, it behooves squabbling partners to take a cue from divorced parents and put aside personal grudges for the sake of the proverbial kids. If they can't, firms that play host to these battles should consider asking one of the partners to leave.

As for the firm where Doug interviewed, Kara was resigned when she recounted the feud. "That's the firm — what can you do?" she mused.

Doug knew exactly what to do — he hustled out of the interview and kept on running.

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Originally published on March 2, 2009 in our free BigLaw newsletter.

In our inaugural BigLaw column, we discussed the practice, once common at large law firms, of gently nudging associates toward the door as they approached their expiration date.

Back in the good old days (think way, way back, perhaps all the way to 2008), the "stealth layoff" could be handled so delicately that associates might actually believe that they had decided it was time to "explore other options."

Welcome to 2009, where mass layoffs seem to be the new black, and subtle, kid-gloved terminations look positively old-timey. Given the thin ice upon which associates now tread, one tipster's story about the many perils of the performance review process seems particularly topical.

Every Large Firm Has at Least One Mr. Flint …

As a mid-level associate at a large New York law firm, "Julie" (not her real name) was universally popular with, and respected by, the partners with whom she worked. After working on a long project out of state, Julie returned to her home office and was assigned to work with a partner who had joined the firm during her absence.

In his short tenure, "Mr. Flint" had burned through several associates, and developed a reputation for being difficult, demanding, and verbally abusive. Needless to say, Julie's experience was no different. Flint was often critical, insulting, and prone to heaping invective on the very associates (including Julie) who toiled on his projects until 3:00 AM, sacrificed weekends, and skipped social engagements to fulfill his exacting demands.

On the other hand, Flint was routinely satisfied with her performance, and when her initial assignment for him ended, he continued to solicit her to work on projects.

Don't Open That Door (Cue Suspenseful Music) …

As review season approached, Julie was uncertain which Flint would undertake her performance evaluation — the derisive screamer, or the partner been pleased with her work product. Fortunately (or so she thought) her firm's review process required the completion of self-evaluations, in which associates were encouraged to discuss the partners with whom they had worked.

Julie explains that, implausible as it now seems, the associates believed that their honest input about their own — and the partners' — performance was welcomed. Julie also believed that writing honestly about her experience with Flint would provide context for, and perhaps preemptively defend against, any negative comments Flint might be inclined to make about her.

Since (she figured) her evaluation would only be viewed by the small committee of partners who managed associate reviews, the self-review would provide her with a perfect forum in which to discuss her experience working with Flint. And, because Flint's ill temper and penchant for bad behavior was so well-known, she thought, no one would be surprised by her side of the story.

For those of you who have the same sense, reading Julie's story, that descends when one watches the heroine of a slasher movie unknowingly open the door to greet the guy in a hockey mask, rest assured: Julie was circumspect in her evaluation, and limited herself to a tactful (and lawyerly) explanation of Flint's tendency to verbally abuse the help.

So imagine her surprise when, during her review, she was treated to Flint's scathing written response to her own self-evaluation. Notwithstanding his satisfaction with her work (as evidenced by repeated requests for more of her time), Flint called for Julie's termination, or at least a period of disciplinary probation. Fortunately, Julie's stellar track record and solid relationships saved her job at the firm, but she was forced to endure several months of "probation" and the tarnishing of her "permanent record."

Lesson Learned: Your Career Can't Handle the Truth …

Although it may seem obvious in hindsight that you should not criticize a partner, Julie points out that the circumstances often make such situations more difficult to read.

First, she believed that she was telling her side of the story to a receptive — if not downright sympathetic — audience: Flint was known for abusing associates, while Julie had an excellent reputation at the firm and had been successful and well-liked in her years there.

"I may have been too cocky," Julie now admits, "but I assumed, because everyone liked me and told me that I did great work, that I would be given the benefit of the doubt."

Second, Julie notes, Flint was relatively new at the firm, and was, by all accounts, quite unpopular with the other partners. As Julie learned, however, the bonds of partnership are much thicker than the (figurative) blood, sweat, and/or tears of even the most beloved associate.

Although Julie continues to work at the firm, she came frighteningly close to losing her job. "At the end of the day," Julie says, "they're partners. No matter how right you — the associate — are, they have connections, relationships, and loyalties that you can't fathom."

Her advice? "Don't put pen to paper," she warns. "Even if you feel like you're setting the record straight, you're better off pulling someone aside to discuss it discreetly. As the associate, assume that you're wrong even when you're right."

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Originally published on February 16, 2009 in our free BigLaw newsletter.

Introduction

Large law firms don't lay people off, do they? Yes, Virginia, they do. And I remember the first time it happened.

Large firms usually let go of people in a manner so gentle as to go unnoticed — even by those who get the axe.

The most common scenario occurs nine years in when a partner walks into your office and suggests that you spend the next year looking for something else to do.

Nice work if you can get it because the paychecks keep rolling in but the work slows to trickle.

The more subtle large firm layoff occurs much earlier when you receive a middling performance review. You might foolishly believe that you can reverse your fortunes. Just don't say I didn't warn you when that ninth year rolls around.

A Massacre By Any Other Name …

Last week's already infamous Valentine's Day massacre has shocked everyone.

How quickly we forget.

A bull market fueled by junk debt financing results in massive hiring and salary inflation at America's largest law firms. When the corporate work dries up during the ensuing recession, law firms cut the most obvious cost — those inflated salaries. Sound familiar? That's what happened in the early 1990s.

This time around the cuts are deeper because the good times lasted much longer and the law firms grew much larger.

But in both cases, the unwritten rule governing tenure at large firms — a veritable pacta sunt servanda — gave way to a clausula rebus sic stantibus when the profits per partner began to plummet.

Of course, I prefer the English idiom. Life sucks, then you get laid off.

The Trappings of BigLaw …

The recession in the early nineties couldn't have been kinder to me. I enrolled in law school at UCLA when it began and graduated when it ended, landing a job at Willkie Far & Gallagher.

I started at Willkie on October 11, 1993. I worked the next 20 days straight before I finally got a day off, fittingly, on Halloween. The firm — or at least the senior associate for whom I was working, which to a first year represent a difference without distinction — would not permit me leave work on October 15th to let the movers into my apartment. My father came to my rescue as parents often do. I had never even seen my apartment until that night, having leased it from afar based on a faxed floor plan.

Was I depressed? Far from it. I was having a blast!

From my perspective, I had an office on the 47th floor overlooking New York City, got free dinner and car service every night, and became fast friends with several of my 40 fellow first years. Plus my first assignment was a Supreme Court petition for certiorari.

More subtle than the accompanying golden handcuffs, these and other trappings of large firm life make you feel more important than you actually are, and keep many young associates content for a while.

But not forever. Sooner or later, you lose your innocence and become jaded. For some, it happens after a month. For others, it can take, well, nine years.

If Gossip Is Information, and Information Is Knowledge …

The large firm trapping I most enjoyed was the gossip. Judging by the success of Above the Law, I'm not alone.

Just like those layoffs in the early nineties, nothing has changed. But good gossip never gets old.

There's all the sex of course. Associates and partners, associates and paralegals, even an associate and a janitor as I recall.

Some gossip makes its way to the press, but even in today's blog-happy world, much of it never leaves the firm, especially the stuff that really matters like a beauty contest win or a botched deposition.

Because we didn't have blogs like Above the Law, I started an underground email newsletter at Willkie. That experience eventually led to TechnoLawyer so it's only fitting that I come full circle back to my email newsletter roots.

And so today we launch BigLaw, a new email newsletter by large firm lawyers for large firm lawyers.

While we intend to dish the dirt, we will do so with the best of intentions.

We're not interested in embarrassing anyone so we'll anonymize all the gossip we receive. Instead, we want to transform this gossip into knowledge by drawing lessons from it — lessons for partners, associates, and heck, maybe even janitors.

You see, for all the knocks against large firms, they're undeniably successful enterprises. And the long hours and the psychopaths with whom you sometimes have to work make you keen and tough.

Nonetheless, large firms have serious problems and lots of room for improvement. Remember Mudge Rose? Brobeck? Thelen? Heller Ehrman? Even the largest firms can go up in smoke much faster than you would think possible.

Can this newsletter save your firm or your job? Hey, we're not miracle workers. But we will entertain and educate you. This much I promise. Pacta sunt servanda.

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Originally published on February 16, 2009 in our free SmallLaw newsletter.

One of my 2009 predictions was that the pace of large law firm downsizing through layoffs, or even dissolving, would increase.

With Heller, Thelen, and Thatcher unthinkably gone, and the "Valentine's Day Massacre" already legendary despite occurring less than a week ago, the prognosis for "traditional" large firms is about as good as it would be for a Stage 4 cancer patient.

With a long dark winter ahead, according to Punxatawny Phil, Spring may not come at all this year for many BigLaw lawyers. As fallout from the economic chill that is gutting the bread-and-butter corporate business of BigLaw, an increasing number of large firm lawyers are jumping ship, before it sinks. And what are many choosing to do? They're going solo.

Yes. Solo.

From BigLaw to BigSolo ...

But these folks aren't ordinary solo practitioners in the way we've come to think of the category. So many solo practitioners have always practiced either on their own, or in small firm situations. They come up the hard way, fending for themselves, often with literally no staff at all, having to learn how to run a business, which most law schools never teach. Traditional solos not only have their JDs, but also a Ph.D from the University of Hard Knocks.

The lawyers emigrating from BigLaw are different. I call them "BigSolos" as opposed to the traditional "SmallSolos."

BigSolos have pinnacle level substantive knowledge in their single chosen practice area. For example, one of my clients is Nancy Hendrickson, recently a partner at Steptoe & Johnson's Chicago office and now the principal of the Law Offices of Nancy L. Hendrickson in downtown Chicago.

Nancy is an extremely experienced securities litigator. Now how many solos do you know who do any securities work at all, no less spend their time litigating securities matters? By contrast, SmallSolos often have general practices with a consumer focus — estate planning, family law, bankruptcy or personal injury work. Some SmallSolos represent small businesses as their outside counsel.

The BigSolo Paradox ...

But practice orientation is not even the biggest difference between BigSolos and SmallSolos.

Many large firm lawyers have always practiced in a BigLaw setting. They clerked for BigLaw while in law school. After their appellate clerkship, post-graduation, they became associates at BigLaw firms. They've wracked up 10, 15, or 20+ years at these firms. And now they're afraid for their jobs and book of business. They're worried about being laid off. They're worried about their firms suddenly doing a "Heller Ehrman" and announcing dissolution.

And most realize how little they know about running a business.

As Nancy Hendrickson observed, "I was used to having an army of staff available to help with everything — IT people whenever I needed them, paralegals and admin staff, not to mention the perks of large law firm life."

After years of being used to having endless staff to help with everything, and being insulated from the need to run, or the knowledge of how to run a law practice as a business, BigSolos may be ill-equipped to face the sudden and sometimes harsh realities of being a small business owner.

From the perspective of a new BigSolo, Nancy Hendrickson noted "that it's hard for clients in this economy not to be attracted to the same services at the lower rates I can now bill. The reaction has been overwhelmingly positive and I'm busier than I had expected. Clients are not only okay with my move to solo practice, they're thrilled at the lower cost impact on their businesses."

Notwithstanding these advantages, Nancy is the first to admit she needs professional assistance on the administrative side of her practice, especially technology and marketing. She astutely concluded that representing herself pro se on her own technology issues made little practical or economic sense. But will all newly minted BigSolos be so prescient? Hard to say.

The paradox is the gap in knowledge — a BigSolo might be a published, top expert in their specific substantive practice area, but may simultaneously be at the bottom of the curve in knowing how to start and run the mechanical and administrative side of law practice. Many also may not be used to having to make rain. A former colleague, perhaps the department chair while at BigLaw, may have been the rainmaker who showered business upon them. And now, the BigSolo must wear many hats:

• Rainmaker
• Firm Administrator
• Office Supply Manager
• HR Manager
• Facilities and Leasehold Manager
• Public Relations and Marketing department
• Webmaster/Blawgmaster/Twitterer
• CLE Compliance Administrator
• IT Manager or IT Liaison with Outside IT Personnel

Oh yes, and one more, if in fact there's time:

• Lawyer

BigSolo Versus SmallSolo ...

What does BigSolo mean for the solo and small firm market? Watch out! Your ranks are in the process of swelling as more and more BigLaw lawyers become BigSolos, either by choice or necessity. They'll bring top-notch legal skills and in many cases a potent book of commercial business.

When the economy tightens, and they need to compete for smaller clientele, they'll become arch-competitors — formidable challengers for the traditional base of SmallSolo clientele.

Some BigSolos will fail miserably and learn the hard way that all the grass is not necessarily as green as it might seem on the solo side of the fence. But the BigSolos who get "it?" The BigSolos savvy enough to retain the right outside expertise at the outset of their adventure? Look out SmallSolos because those BigSolos may eat your lunch and make LegalZoom seem like a gnat by comparison.

Just ask Nancy Hendrickson. She has succeeded by bringing in professional help. It's hard to imagine Nancy not running circles around her former practice and colleagues, offering the same top-notch BigLaw expertise at a SmallSolo rate — just what the current economy ordered.

I anticipate high demand and short supply for "do it all" consultants who can create a law practice to wrap around a BigSolo's substantive abilities. I'm thrilled to be among those helping to make this happen and transforming the legal world in the process. We live in interesting times. BigSolo, let's see what you can do.

Written by Ross Kodner of MicroLaw.

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InsideLegal's LegalTech Report (Including TL Party Photos)

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