Corporate lawyer and law business author Michael Trotter sees the problems at Dewey and LeBoeuf as being sympomatic of wider issues within the legal business. And there will be more Big Law trouble ahead, according to Trotter, whose new book “Declining Prospects” looks at the changes in the legal profession and why they’re are causing long-term problems.
An interview with the NY Times provides some interesting observations about a profession facing – if not a crisis, something not far off it.
The publication of “Declining Prospects” comes at a moment when Dewey faces the risk of collapse. The turmoil at the firm appears to be a manifestation of a lot of the issues that you discuss in your book.
A.I don’t think Dewey’s problems are just a matter of a management mistake here or there but instead reflect a change in the fundamental competitive environment in the legal services industry. Many of the larger firms that serve major business clients are caught up in these changes. We’ve already seen several go under, and I think we’ll see quite a few more over the next few years.
Q.What has changed?
A.There are now far more capable lawyers and law firms than there is work for them to do. The financial costs of legal services have gotten so high that most clients are determined to reduce them. Many legal services have become commodities that can be supplied by a large number of firms with sufficient quality to meet the needs of most clients in most situations, and corporate general counsel now know that they can get what they need at a lower cost if they force the major firms to compete for the work.
Q.One reason for Dewey’s trouble is that it poached lawyers from rival firms by offering them multiyear, multimillion-dollar guaranteed contracts.
A.That’s a very risky strategy. For one thing, people don’t always produce what they promise; often not all the clients that they currently have move with them, so to give anyone a guaranteed contract based on their past success is basically a mistake. Imagine the environment where profits are dropping and there are some partners getting the full amount they were guaranteed and you’re getting half of what you expected. It generates a lot of hard feelings.
Q.A few chapters of your latest book are devoted to the working conditions at big law firms. You describe a grim environment.
A.Law firms expect associates to put in 1,800 to 2,000 billable hours, and at some firms it’s up to 2,500. That’s 50 hours a week, 50 weeks a year. And that’s just the billable time. Every lawyer has to make an investment every day of time that’s not billable. You have to study and learn, improve your skills, administer to your practice. If you’re working 50 hours a week of billable time, you’re probably working 65 to 70 hours of total time. So the burden is tremendous. Now, with the Internet and cellphones, you’re in demand possibly every hour of every day of every week.
Q.But haven’t these issues been around for years? Big law firms became big businesses a long time ago, and some will say you’re just an out-of-touch, bow-tie-wearing Southern lawyer romanticizing the practice and yearning for the days of Atticus Finch.
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