The US law firm scene has seen three major announcements of Big Law ‘splintering’ with the creation of litigation boutiques. And so the question is raised whether 2016 will be the year of the litigation boutique.
As Bloomberg reported the first splinter involved 11 lawyers decamped from Arent Fox in California who went off to form Larson O’Brien. No sooner had the Arent Fox split occurred when two lawyers departed Paul Weiss Rifkind Wharton & Garrison to start Wilkinson Walsh & Eskovits. Then, last week came the news that 22 partners are set to leave Schiff Hardin to form Riley Safer Holmes & Cancila.
The appeal of a boutique practice that lets lawyers do what they love without the fear of conflict issues and the like is part of the attraction. But there is also the compelling need to ensure there is a stream of work with good rainmaking required.
Can they all succeed?
One Bloomberg Law Business source was quoted on the Schiff Hardin exodus:
Canary in the bird cage? Have you noticed a marked trend in viable, profitable, groups departing large or very large firms to form their own firms? A little research to verify could (reveal) certain vulnerabilities of AmLaw 200 firms stemming from the inherent tension between the need of these firms to grow and rationalize and the human dynamics/emotional needs of the partners who comprise them.
What do the recruiters say? Jackie Knight, a recruiter with Major, Lindsey & Africa, explained that the moves are motivated by personal and business reasons, but noted the other side of the coin too:
Many partners do remain in larger firms and do not make the leap, because the thought of managing the day-to day administration aspects of firm may be daunting. Also, cross-selling opportunities and brand of a larger firm may lead to business opportunities at a larger firm that may not exist at a smaller firm.
So what does the remainder of 2016 look like? Is this the beginning of a wave that could eat into Big Law profits?