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PLP Pulse: News from the Frontiers of the Legal Profession
April 2011


São Paulo Bar Vetoes Associations between Domestic and Foreign Law Firms
Latin Lawyer

The Brazilian Bar Association in São Paulo (OAB/SP) has decided that existing “associations” between domestic and foreign law firms (which were created because overseas lawyers cannot practice directly in Brazil) should not be allowed. According to the Latin Lawyer, OAB/SP argued that “the rules prohibit associations between lawyers and non-lawyers, and [because] foreign lawyers are not technically lawyers in Brazil, then the existing associations fall outside the regulations.” Carlos Kaufmann, Director of OAB/SP, explained: “The physical location of both [Brazilian firms and international affiliates] has to be in a different place, without any semblance of similarity between stationery, business cards, websites, or e-mail addresses.” Latin Lawyer reports that this decision has “split the legal community in São Paulo,” with some asserting that OAB/SP “has gone too far” and others believing that the organization “is taking the necessary steps to protect clients, and the Brazilian legal community overall.”

Foreign Law Firms Increasingly Interested in Indonesia
ALB Legal News

Indonesia has become increasingly attractive to foreign law firms, according to ALB Legal News. Indonesia’s economy is growing strongly at about six to eight percent per year, while new opportunities are emerging in infrastructure projects, finance, banking, mergers and acquisitions and inbound investment agreements. As a result, international firms are forming alliances with local law firms, such as the recent affiliation between England’s Norton Rose and Indonesia’s Susandarini & Partners. Some local firms like ABNR, however, regularly work with international firms but decline alliance offers because they believe that independence enhances their strategic position.

Chinese Legal System Slowly Improving but Still a “Work in Progress”
South China Morning Post

Mainland Chinese courts “are slowly moving towards a system based more on rule of law rather than on official whim,” according to the South China Morning Post. Influencing this trend are new legal talent, rising competition and foreign investors who are “demanding legal certainty for their billion-dollar projects.” But “there is still a long way to go,” the Post reports, citing a 2009 Carnegie study concluding that the mainland’s legal system remains a “work in progress” despite three decades of reform. Some remaining concerns: standardization of law across the provinces, lack of precedents, outdated laws, significant restrictions on foreign lawyers, impartiality and corruption. Moreover, “education for students majoring in law is far from adequate to develop them into qualified lawyers or judges,” according to Gong Zhenhua, a partner at the Ronghe Law Firm in Shanghai.

Growing African Legal Market Provides Risks and Rewards
The Lawyer (“Trade Routes” and “The Scramble for Africa”)

The Lawyer explores some of the risks and rewards in the increasingly important—and evolving—African legal market. The Lawyer notes that legal work in Africa “is no longer just about infrastructure projects,” and now includes matters involving natural resources, telecoms and finance, among others. The African legal market is both large and diverse, in part because Africa is simply “a bloody big place,” in the words of Shearman & Sterling’s Nicholas Buckworth. For example, firms focused on mining might concentrate on projects in Mali, Chad and Sierra Leone, while firms with energy matters may find themselves in Equatorial Guinea and Mozambique—and firms facilitating cross-border funding might engage the Nigerian banking sector. While political unrest across the African continent often creates risk, the South African market represents one of the more developed jurisdictions for legal services, and “there’s a growing maturity in a lot of countries in Africa, which means they can withstand the sort of problems that five to ten years ago led to people pulling out very quickly.” Moreover, affiliating with networks of firms and local lawyers can be helpful for international law firms, but finding the right partnering opportunities can sometimes be challenging, according to The Lawyer.

Law Firms and Practice Management

“Soft Bounce” in Summer Associate Hiring but Class Sizes Still Lower than Before Recession
National Law Journal

The National Association for Law Placement (NALP) reports that offer rates to summer associates rose from 69 percent (an historic low) in 2009 to 87 percent last year, according to the National Law Journal. NALP Executive Director James Leipold notes that “the most dramatic impact of the economic downturn has passed,” but warns that “it will be some years before we see a return to the sort of robust recruiting levels we saw in 2006 and 2007.” Leipold added that summer associate class sizes “may never” return to pre-recession levels.

Public Interest Lawyering

Law School Deans: “Equal Justice” in “Severe Jeopardy” with Respect to the Poor
Boston Globe

Law school deans Martha Minow (Harvard Law School) and John Broderick (New Hampshire School of Law) recently published an editorial in the Boston Globe in which they warn that cuts in funding for civil legal assistance—legal help for the poor—would put “equal justice under the law” in “severe jeopardy.” Citing a proposal to cut $70 million from a total of $284.4 million of Congressional grants for civil legal assistance, the two deans argue that “many of the 900 programs helped by the federally-funded Legal Services Corporation will need to close[,] 370 staff attorneys will be let go and 162,000 fewer people will be served.” Deans Minow and Broderick conclude that these cuts would “abandon the some of the most vulnerable people in our nation” while “creating new burdens not only for them but also for their communities and public budgets, as an evicted person becomes homeless, an abused person lands in a hospital, and a veteran fails to re-enter the workforce and community life.”

Should Prosecutors Receive Bonuses for “Hitting Conviction Targets”?
Denver Post

Carol Chambers, a district attorney in Colorado, has adopted a bonus plan in which an assistant district attorney may earn a $1,100 reward (on average) if he or she participates in at least five trials during the year and wins felony convictions in at least 70 percent of those trials, according to the Denver Post. Some defense attorneys have criticized the plan because it might encourage prosecutors to seek trials (rather than plea bargains) to qualify for a bonus, while some prosecutors are concerned that the scheme will discourage prosecution of “hard cases.” Chambers defends the plan by noting that it establishes a helpful “performance standard” for lawyers and “does not in any way encourage any outcome in any specific case.”

Some Retired Judges Returning Full-Time—with No Extra Pay—to Help Reduce Caseloads
Los Angeles Times

Retired senior judges—who return to the bench to hear current cases—are “coming to the rescue” of federal courts “stagger[ing] under the weight of mounting caseloads and vacant judgeships,” according to the Los Angeles Times. Senior judges are particularly important in the U.S. Court of Appeals for the Ninth Circuit, where the panel “shoulders a third of the legal load.” While senior judges earn gratitude from their colleagues, “they do not earn a penny more for continuing to work, many of them almost full time, than they would if they were to hang up their robes and head for the golf course.” University of Pittsburgh law professor Arthur Hellman states that the Ninth Circuit “could not function without those active senior judges,” but warns that “fairly soon” the amount of assistance courts can expect from senior judges will be substantially reduced.

Innovation & New Models

Could an “eBay for Lawyers” Really Work?
Wall Street Journal

Robert Grant Niznik, a 21-year-old New York Law School student, has created a website called “Shpoonkle” under the advertising motto, “Justice You Can Afford.” Niznik argues that “middle-class Americans who don’t qualify for legal aid but also can’t afford to pay for legal advice have few other places to go,” according to the Wall Street Journal. As a result, Shpoonkle will allow potential clients to describe their legal issue and then permit attorneys to “bid” for the representation (all participants must be registered users). Niznik plans to keep the site free for clients, charge attorneys for access, and sell advertising. Some lawyers, such as New York criminal defense attorney Scott H. Greenfield, “don’t think Shpoonkle will fly” and caution potential clients to be wary of “spilling their guts” online.

Montreal Company Creates the “Largest Free Database of Case Law in the World”
Montreal Gazette

Last year Montreal-based Lexum created “CanLII,” which the Montreal Gazette reports is now “the largest free database of case law in the world.” CanLII offers “free, online access to the laws and regulations of all jurisdictions across Canada as well as more than 800,000 decisions of the Canadian courts.” Now Lexum is seeking to increase its presence in this “lucrative and burgeoning” market for legal information management, not only in Canada, but across the globe. Moreover, Lexum plans to “tailor systems for specific law firms and specific institutions” to help them exploit CanLII’s “treasure.”

With a Backlog of 5.4 Million Civil Cases, Italy Passes Legislation Mandating Mediation
Wall Street Journal Law Blog

According to the Wall Street Journal, a 2008 European Union directive called upon every EU nation (except Denmark) to pass a law providing for mediation of cross-border civil cases. Italy passed such a law, and is the only EU nation to make mediation mandatory. Some Italian lawyers have protested the legislation, and have even encouraged their clients to sign letters of protest. Supporters contend that such opposition is evidence that mediation “is being treated as a serious threat by a constituency with a stake in judicial inefficiencies.” Italy currently suffers from a backlog of 5.4 million civil cases.

If “Loser Pays” Does Everybody Win in Texas?
Texas Tribune

Texan supporters of the “loser pays” model of litigation—in which the losing party pays some or all of the prevailing party’s legal costs—argue that it represents “the cure for courts choked with the costs of junk lawsuits,” according to the Texas Tribune. Texas Governor Rick Perry praised this approach (also known as the “English Rule” given its prevalence in Britain) in his recent State of the State address. But the proposal is likely to receive a “tepid” response in the legal community, according to Texas lawyer Thomas Melsheimer, who also stated that the public may not embrace the new model “once people understand that it could make the ordinary citizen suing Walmart pay for Walmart’s legal fees if they lose.” State Representative Will Hartnett said that any such legislation “will have an uphill battle this session.”

Attorney Regulation and Ethics

Investors Cannot Bring Fraud Suit Against Clifford Chance for Alleged “Workaround to Avoid Disclosure”
American Lawyer

The U.S. Court of Appeals for the Third Circuit has ruled that investors of Diagnostic Ventures, Inc. (DVI), cannot bring a securities fraud case against Clifford Chance, DVI’s law firm, for alleged advice to conceal potentially damaging information. DVI claimed that a Clifford Chance partner devised a “workaround” to enable DVI to withhold the fact that an auditor found weaknesses in DVI’s internal controls. The Third Circuit held that “[e]ven assuming Clifford Chance developed the workaround to avoid disclosure of DVI’s material weaknesses, and DVI would have issued a truthful 10-Q if the law firm did not present this alternative, it was still DVI, not Clifford Chance, that filed it.” Counsel for the investors plan to appeal to the U.S. Supreme Court.


British Firms Increase Number of Universities Visited to Improve Lawyer Diversity

England’s Legal Week reports that “a raft of the UK’s leading law firms are set to increase the number of universities they target for graduate recruitment in a bid to attract a wider pool of students.” The “Magic Circle” firms of Linklaters and Freshfields Bruckhaus Deringer plan to increase the number of universities visited this year, after Slaughter and May and others expanded the number of universities they visited last year. All told, seven of the UK’s largest 20 law firms (by revenue) will have “increased their university links” since September 2010. Last year Legal Week reported that law graduates from Oxford and Cambridge universities comprised over one-third of all “magic circle” trainees (nearly half at some firms) over the preceding two years.

Corporate Counsel

“Alternative Billing” Finds High-Profile Advocates, but “Firms Have Been Slow to Adapt”
Corporate Counsel

David Boies, Chairman of Boies, Schiller & Flexner, and four top in-house lawyers argued in favor of “alternative billing” at a recent midyear meeting of the American Bar Association. General counsels and associate general counsels from du Pont, Pfizer, Walmart and Altria Client Services shared their experiences with and support for alternative billing. David Boies argued that alternative billing can be positive for law firms, as well, and stated that one of his firm’s goal since its founding in 1997 has been to eliminate hourly billing. According to Corporate Counsel, Boies argued that “hourly billing pits the interests of the firm against those of the client, while alternative billing can align their interests by bringing in more and better work for the firm.” Despite these potential advantages, however, law firms have been “slow to adapt,” and legitimate concerns remain.

Firms Asked to Curb Fees through Contingency Arrangements or Caps
Wall Street Journal

Rather than work according to traditional hourly rates, many companies are asking their outside counsel to “share the risk of litigation” through contingency fee arrangements, according to the Wall Street Journal. In BTI Consulting Group’s 2010 survey of 300 Fortune 1000 in-house lawyers, for example, 26 percent of respondents reported using a contingency arrangement, up seven percent from 2007. When retained for defense work, large firms may also agree to fee caps or flat fees to accommodate corporate client requests to reduce legal spending.

Legal Education

Law Schools Experience 11.5 Percent Overall Drop in Applications, Losing “the Froth”
Wall Street Journal

Law school applications have decreased nearly 12 percent over the past year, causing the Wall Street Journal’s Nathan Koppel to speculate that potential students are reluctant to apply given certain debt and uncertain job prospects. Those who do apply “appear to have analyzed the investment in law school closely and are serious about pursuing a career in law,” according to Fordham Law School’s Carrie Johnson. Kent Syverud, Dean of the Washington University in St. Louis School of Law, adds that “the froth in the applicant pool – those who were just going to law school because they didn’t know what else to do and everyone told them it was a safe bet – is pretty well gone.”

Yale Law Library Loans Monty—a Therapy Dog
Yale Daily News

According to the Yale Daily News, “dog days have come to Yale Law School,” which recently piloted a “therapy dog” program whereby the law school lent Monty to students for half-hour visits. In an email announcing the program, Yale Law Librarian Blair Kauffman stated that “it is well documented that visits from therapy dogs have resulted in increased happiness, calmness and overall emotional well-being.” Ursula Kempe, President of Therapy Dogs International, stated that therapy dogs can be useful in many different contexts, from helping youths relax during public speaking to comforting victims of serious trauma. She argues that bringing therapy dogs to university campuses is entirely consistent with such uses, and she hopes that the program at Yale Law School will continue.

Program Notes

PLP is Hiring Fellows!

The HLS Program on the Legal Profession invites applications for two Postdoctoral Research Fellows to join our terrific research team for one or more years in Summer 2011.  Both fellows will work on empirical studies of the legal profession - one with a specific project focus on globalization and emerging economies and the other a more flexible portfolio. To apply, visit employment.harvard.edu, using requisition number 23511 or 23512.

Oxford Fellowship Opening

The Novak Druce Centre for Professional Service Firms at the University of Oxford’s Saïd Business School is pleased to invite applications for the position of Post Doctoral Research Fellow for one year beginning in October 2011. More information.

Summer Research Assistant Positions at PLP

The Program on the Legal Profession seeks to hire two incoming or advancing HLS JD students to work with Professor David Wilkins and his research team for PLP’s Globalization, Lawyers, and Emerging Economies (“GLEE”) Project. This new study is the first comprehensive attempt to analyze the impact of globalization on the overall workings of corporate legal sectors in emerging economies as well as their increasing interactions with the legal professions of advanced economies. Visit our website to apply.

Tell Us About Your Legal Mentor

We would like to hear specific examples of effective—and not so effective—legal mentoring practices and experiences.  To share thoughts and experiences with us, click here (this is not a full survey, but a link to a form where you can type freely about your experiences).  All individuals will remain anonymous, unless they wish to be identified.   If you have not done so already, please also take our anonymous, full-length legal mentoring survey here.

Dynamic Program for General Counsels and Chief Legal Officers

Harvard Law School Executive Education is offering an intensive, three-day program in June 2011 for General Counsels and Chief Legal Officers. This program offers insights into the challenges faced and provides concepts and skills to be effective leaders in your companies. Join us for an information session on April 28 in New York City for more details, or visit us online.

Editor: Cory Way
Managing Editor: Nicola Seaholm
Contributing Editors: Amanda Barry, Hakim Lakhdar, Mihaela Papa, Erik Ramanathan

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