Interest in Australian Legal Market Increases as Major Chinese Firm Merges
In recent years, several UK firms have entered the Australian legal market; more recently there has been a first union between a Chinese and Australian firm and a first international merger for a Chinese firm. Australian law firm, Mallesons Stephen Jaques, and one of China’s largest firms, King & Wood, have agreed to rebrand as King & Wood Mallesons effective 2012. Chinese regulatory constraints mean that the firms cannot combine financially in a full merger, and therefore they will be set to unite under a Swiss verein structure. This will allow the pair to maintain separate profit pools while operating under a single brand, with centralized back office functions.
Legal Power Shift from Anglo-Saxon to Chinese Law Firms
The old balance of power where Anglo-Saxon law firms dominated the global legal market is being challenged. The Chinese legal market is rapidly expanding and internal, intra-Asian trade and demand is critical. Chinese law firms are going global: the two largest firms, Dacheng and Yingke, are planning to open offices in London; King & Wood is planning an association with Australian firm Mallesons Stephen Jaques. While Chinese law firms are starting to adopt Western-style partnership structures that facilitate overseas expansion, they remain highly protectionist towards international law firms. Anglo-Saxon firms have a narrow window of opportunity to build expertise, experience, and relationships in China. Currently, benefits of the current system include the dominance of English and US common law systems; global platforms; and, better capabilities to provide service for outbound investment advice. Their long-term success will depend on a quality-driven international growth strategy and strong relationships with Chinese firms.
White & Case Probes Service Transfer to Eastern Europe
White & Case is considering transferring part of its business process unit in the Philippines to the Czech Republic, Hungary, or Southern Poland. According to The Lawyer, the firm is concerned about its overexposure in the Philippines, political and economic uncertainty, the risk of a natural disaster, and the preference for offshore services closer to the hubs the firm serves. While the Eastern European hub would start with roughly 20-40 staff, potentially rising to 100 over four years, staff numbers in the Philippines base office would ease out over time through natural attrition and the office will pilot legal process outsourcing.
Chinese Business Lawyers Association Elects First Ethnically Non-Chinese Director
The Chinese Business Lawyers Association (CBLA), a professional organization for businesspeople and attorneys focused on Chinese legal issues for professionals interested in law and business in the US and China elected its new board of directors. The election represents the first time that an ethnically non-Chinese director was chosen: Geoffrey Sant is an attorney at Morrison & Foerster LLP and has been a frequent commentator on CCTV, Phoenix Television, Global Times, and other Chinese-language media.
Indian Supreme Court Maps out Case Pendancy
The Indian Supreme Court prepared the unprecedented case pendency statistics for National Law Day. Chief Justice of India SH Kapadia observed that all stakeholders were accountable for the delays, and that he wanted to appoint a working committee on arrears and court management. Two academics researching case pendency, Jindal Global Law School Dean Raj Kumar and Indiana Law Professor Jayanth Krishnan, argue that the statistics demonstrate the problem of delay by lawyers and underscore the need for courts to enforce accountability. They highlight the need to reform legal education and improve the quality of the legal profession. Namely, 71% of cases are delayed due to unpaid and other issues not caused by judges.
LiveMint.com & The Wall Street Journal
Even with 1.2 million lawyers and approximately 400,000-500,000 people currently studying law, India is nonetheless hugely “under-lawyered.” In absolute numbers, India is on par with the US (1,201,968 lawyers in 2010 according to the American Bar Association), however its legal population density (number of people per lawyer) is about four times as high. In India, the distribution of lawyers is uneven according to Rajiv Luthra, managing partner at Luthra & Luthra. There is a huge concentration of lawyers in litigation, but a noticeably low number of lawyers at the high end. Understanding the comparative distribution of lawyers in different countries can improve knowledge about the legal market in countries such as India.
Law Firms and Law Schools Partnering on Executive Education
There is an increasing trend among law firms to provide law graduates additional practical training after law school. The College of Law in the UK, for example, has partnered with law firms to provide a year-long Legal Practice Course (which can cost over £12,000) to learn practical skills including how to draft a merger. Across the Atlantic, Harvard Law School has partnered with Milbank where new associates are enrolled in an eight day course to learn about leadership and management. According to the Financial Times, “Milbank cites statistics from After the JD...—a Harvard Law School study of the career outcomes of new lawyers—which found that 74 per cent of graduates in firms with more than 250 staff said they wished they had received more business training in law school.” According to Hugh Verrier, chairman of White & Case, firms partnering with business and law schools “will ultimately create a change in the way law is taught at university.”
Lawyers Battling Depression
New York Law Journal & Lawyers with Depression
Following the 2005 suicide of a Fordham University Law School graduate studying for the bar, the issue of lawyers battling depression has received increased attention. According to Michael Lane, a shareholder and civil litigator at Anderson Kill & Olick and a supporter of the Uncommon Counsel program, a group that works to combat suicide among law students, “the intense, competitive and adversarial nature of legal practice (particularly over the past 10 to 20 years) results in greater stress, anxiety, and depression.” Psychologist Martin Seligman writes that lawyers are in remarkably poor mental health and are at greater risk than the general population for depression. Through the lens of positive psychology, he identifies three principal causes for the demoralization of lawyers—pessimism, low decision latitude in high stress situations, and the fact that American law is becoming a win-loss game. More attention should be placed on helping young lawyers focus on their “signature strengths” (leadership, originality, fairness, enthusiasm, perseverance, and social intelligence).
UK Experts Push for Elimination of Two-Year Training Contracts
Wall Street Journal Law Blog
UK regulators are considering ending the traditional two-year training contracts for some lawyers in an effort to compete with the US for the “best and brightest” candidates from around the globe. Nigel Savage, chief executive of the College of Law, cited the “relative ease of access that enables global students to sit the New York Bar exams” as one reason why many young lawyers may choose a US firm over one in London. According to Professor John Flood of the University of Westminster, eliminating the training contract requirement would help to align the UK legal education with the rest of the world.
Legal Departments Taking Measure
Corporate Counsel & AmLaw & Law.com
There is an increasing demand for legal departments to demonstrate their value in numbers to their companies, according to two recent surveys of corporate counsel from ALM Legal Intelligence conducted among 225 corporate counsel on compensation and 99 respondents in a survey on performance. Middle-ranking lawyers received bonus increases of up to 58%, and the median compensation (salary and bonus) for general counsel was down 1% to $464,000. While the number of lawyers working in-house decreased last year, the number of paralegals and administrative staff grew. Additionally, the average number of firms employed by companies with revenue of at least $5 billion rose from 126 to 173. More than half of the respondents say that law firms will be offering alternative fee arrangements in the future.
Overcoming Common Concerns with Legal Process Outsourcing
According to Inside Counsel, some of the common concerns around legal process outsourcing (LPO) include ensuring that legal work remains secure and confidential, maintaining high quality standards, reducing the risk of unauthorized practice, and getting buy-in to LPO despite threats to the bottom line or lack of trust. Suggestions to overcome these concerns include acquiring certifications such as Six Sigma, ISO 27001 and ISO 9001; building strong service legal agreements that hold LPO providers to a particular standard of quality; clarifying the role of LPO providers through collaboration with the American Bar Association; and adopting a hybrid onshore/offshore model so that LPO providers can provide seamless service.
Innovation & New Models
Lawyers Getting Creative with Mall Legal Aid Kiosk
The Palm Beach Post
In November, three Palm Beach County attorneys opened The Law Booth (TLB) to assist individuals in need of foreclosure legal aid while operating outside of normal business hours and a traditional office setting. The TLB kiosk is located at the Boynton Beach Mall because it is between the Delray Beach, Belle Glade, and West Palm Beach offices of the Legal Aid Society of Palm Beach County. They currently offer various discounts to clients including free 15-minute consultations through the holidays, and they intend to remain a permanent fixture in the new year with hopes of opening in additional locations.
Law Firms & Practice Management
Global Work Leads to Increased Revenues for UK Firms
Law firms in the UK are seeing double digit revenue increases over last year’s results. Many of these firms are attributing their successes to work outside of London. “Our results are primarily down to revenues from outside the U.K., with the firms revenues from its international office up 25 percent over last year. While corporate activity has been slow, areas such as restructuring and finance have been busy,” explains Ashurst’s managing partner Simon Bromwich.
Merging to Survive: Law Firms Merge to Gain New Markets
The Western Mail
As law firms look to bounce back from the credit crunch they will increasingly turn to mergers with other firms. Louise Evans, a professional practices partner at Grant Thornton, states that with the change in market conditions caused by the financial crisis and the introduction of UKs Legal Services Act, law firms will look to mergers for the “strategic and operational issues they face.” One issue is the need to attend to customers outside large cities. Merging with smaller local firms will help with this.
Using Compensation to Motivate Lawyers
“The biggest problem with financial incentives is that they are overused,” according to two authors in the American Lawyer. Patrick McKenna and Edwin Reeser discuss the negative effects that can result when law firms rely exclusively on money as a motivator. First, compensation does not guarantee results, does not necessarily make individuals smarter, can stifle collaboration, can destroy cultural priorities, and the satisfaction from money is often short-lived. According to a survey of high performers, other top motivating factors include maintaining a positive reputation, being appreciated, believing the work is important, and receiving interesting assignments. The authors write, “we think the more enlightened question is: How can we create the conditions in which our lawyers will motivate themselves.”
Young Legal Entrepreneurs Finding Success
New York Times, article & related discussion
Solo and small-firm practice continues to be an attractive option for young lawyers dissatisfied with the high-stress environment of a large law firm career. The New York Times reports on five firms in their early stages, all founded by former large firm associates. Each of these entrepreneurial firms has achieved some level of success after initial periods of self-education on accounting, administration, and business development. It can take as long as two years to turn a profit, but the smaller firms have utilized their social networks to generate business, and have satisfied new clients by employing creative and predictable billing arrangements.
Canadian Law Firms and Government Computers Affected by Cyber-Attack
Cyber-forensics expert Daniel Tobok believes that a foreign intelligence service or state-sponsored hackers are responsible for a series of massive data systems breaches at prominent Canadian law firms and Canadian government computers. Based on digital evidence, investigators were able to trace the attacks to computers in China. The data theft was “sophisticated and highly targeted,” and all of the compromised information was linked to a failed $38 billion takeover of the Potash Corporation. One of the firms involved in the deal, Blake Cassels & Graydon, released the following statement: "We take our obligations of confidentiality to our clients and the integrity of our systems very seriously. While we do not comment on client matters, we are not aware of any compromise of client information as a result of any attempt to breach our systems."
Attorney Regulation & Ethics
A Disgraceful End: Robo Signing Firm Steve J. Baum P.C. Calls it Quits
The New York Times
One of the most controversial law firms involved with the mortgage crisis will be closing down. With tactics known as “robo signing,” particularly on foreclosure agreements, the law firm of Steven J. Baum P.C. has notified government agencies that due to a loss of business they will be shutting down. This brings an end to months of recent poor publicity and court rulings against the firm. According to Mr. Baum, who filed papers notifying government agencies that it plans to close, “Disrupting the livelihoods of so many dedicated and hardworking people is extremely painful, but the loss of so much business left us no choice but to file these notices.”
Paying Law Students to Drop out of Law School
The Chronicle of Higher Education
Two Yale Law School professors have proposed giving law students “a half-tuition rebate” to split the loss of an aborted legal career of first-year law students. As law schools continue to graduate law students in a shrinking job market, obtaining a law degree is becoming riskier. “Law school is a very risky (and expensive) investment; it should not be entered into lightly,” states Professor Paul Caron of the University of Cincinnati College of Law. The tuition rebate idea was inspired by Internet shoe seller Zappos.com, who at the end of a monthly training program tests their new workers’ loyalty by offering them $3,000 to quit. President of the Association of American Law Schools, Michael Olivas, states, “Most of these students are going to find their way if they’re willing to be flexible and to look more broadly…not everyone is going to practice law in the traditional sense, and I don’t think that’s necessarily a bad thing.”
Salaries Double for Corporate Lawyers in India
The salaries of law students from prestigious law colleges in India have increased considerably over the last five years. This can be attributed to two main factors: first, there is an increasing demand for corporate legal services in India due to globalization and an increase in business activity overall; second, although the supply of lawyers from prestigious colleges may have increased overall, it has not caught up with the increase in demand by corporate law firms and in-house legal departments of corporations. Trilegal pays approximately Rs. 1.08 million per year whereas they used to pay only about Rs. 500,000 five years ago. Similar reports of dramatic increases in salary come from other law firms such as Amarchand Mangaldas, Khaitan & Co., and AZB & Partners.
ABA to ensure Law School Graduate Information is Accurate with Questionnaire
The ABA Journal
After recent reports of misrepresented statistical information by law schools, the ABA’s accrediting committee has decided to address the issue. They will begin collecting more detailed job placement and salary information of recent law graduates who will be required to fill out a questionnaire regarding their employment status. The results will eventually be posted on the ABA website.
Educating Better Regulators?
In a recent report, the Financial Times highlights curricular innovations designed to provide lawyers with stronger backgrounds in economics and international business. The programs focus on developing deeper knowledge in commercial law and business through partnerships with business schools delivering some of the courses directly. Chicago’s Law and Economics Initiative is one such program, which has the aim of expanding the law and economics influence outside of the US. A common goal of these types of curricular innovations is to improve capacity for financial regulation.
Law School Graduate but not Lawyer
New York Times
With changes in the economy, clients of law firms are no longer content with having new lawyers trained on the job and on their dime. A survey by the American Lawyer found that 47% of law firms had a client say that they do not want to see the names of first- or second-year associates on their bills. According to David Segal, law schools have been notoriously slow to respond and he discusses why some schools defend their curriculums and others are attempting to integrate a more practical education. First year associates at the law firm Drinker Biddle spend four months learning corporate law while working at a reduced salary. During this period they are neither expected nor allowed to bill clients. According to professor and former dean of Vanderbilt Law School, Edward Rubin, “We should be teaching what is really going on in the legal system, not what was going on in the 1870s, when much of the legal curriculum was put in place.”
Similarities Discussed between ‘Tiger Mom’ Parenting and Mainstream Legal Education
The ABA Journal
University of Colorado Law School Professor Peter Huang describes the current approach to legal education as similar to the parenting advice given by Amy Chua’s widely debated “tiger mom” style. Professor Huang highlights that “both rely on hierarchical, top-down learning environments that emphasize compliance, fear, memorization, obedience, precedent, and respect for elders.” Many legal education reform ideas tend to paint a different picture whereby today’s lawyers will be more successful if they adopt good judgment and sound decision-making skills that allow young lawyers to know the law and have emotional awareness.
Outdated Legal Education, or too Many Law Schools?
New York Times
An article in the New York Times claims that legal education in the US is stuck in outdated practices, and has failed to align what is taught in law schools with what is needed in law firms. Law schools produce too many lawyers without good job prospects while there is a shortage of legal services for the poor and middle class. According to the Times, “the choice is not between teaching legal theory or practice; the task is to teach useful legal ideas and skills in more effective ways.”
Public Interest Lawyering
Public Interest Litigation in India: A Model for China?
Chinese legislators are considering introducing a new public interest litigation (PIL) system to encourage proactive judicial activism to address environmental and food safety scandals. Following the visit of a Chinese delegation of law professors to India and their interactions with judges, lawyers and activists, a delegation member, law professor Wang Sixin with the Communication University of China, suggested that Indian PIL is a possible model for Chinese PIL legislation. As Wang explains, in China the individual has no right to initiate PIL unless his or her rights are directly undermined, while in India just about anyone can initiate PIL for little cost.
Two Studies Show that Faculty Diversity is linked to Law Review Diversity
National Law Journal
The 2010-11 Law Review Diversity Report, published by the New York Law School Law Review, reveals that flagship law reviews have a greater percentage of women members at schools with high percentages of female and minority professors. In 2010, the nonprofit organization Ms. JD conducted a similar study focusing on the top 50 schools in the U.S. News Best Law Schools rankings; it found that among schools with higher percentages of female and minority professors, law reviews had more women and were more likely to have a woman serving as editor-in-chief.
Should Diversity be a Factor in the U.S. News Rankings?
At a recent symposium at St. John’s School of Law in Queens, New York, law school faculty and administrators from around the country, along with John Morse, director of data research for the U.S. News & Report, met to discuss diversity and its role in law school admissions and rankings. While U.S. News does publish a law school diversity index, some reform advocates believe that diversity should be a factor in their general Best Law Schools rankings. This may encourage law schools to add diversity as an important focus (along with LSATs and GPAs) as they try to improve admissions data to increase their rankings. U.S. News “does not want [its] rankings to be part of the ongoing public policy debate of how to achieve diversity goals at law schools.” Morse also expressed concern over the definition and measurement of diversity and whether it should include factors other than race and gender (i.e. age, income, geography).
Survey Highlights Minority Associates’ Continued Disadvantages
The annual American Lawyer Midlevel Associates Survey highlights continued differences between white, black, Asian and Hispanic associates at law firms across the country. While the pay gap between races is closing, mentoring alone has not been enough to bring minority associates to full parity with their peers. For example, African-American associates are the most likely to have a mentor, but are more likely to receive less pay and bill fewer hours. Additionally, as the survey indicates, all minority respondents felt they had a lower chance of making partner than white respondents and exhibited lower satisfaction numbers with their compensation and benefits.
Commitment to Diversity Still a Priority Despite Recession
After experiencing cutbacks and layoffs during the recession, firms have refocused their energies on diversity measures. Many firms experienced declines in diversity since associates took the brunt of layoffs and those ranks are where diversity was particularly strong. Among firms that are seeing the biggest gains in their diversity statistics are those with a strong commitment to diversity from the top. Patricia Brown Holmes, a partner at Schiff Harden, says that was a critical piece to her joining the firm, “Part of the retention issue stemmed from associates lacking role models and mentors at the very top of the partnership ranks. If associates can’t look up and see themselves reflected, then they are going to question whether they will make it to the top.”
Law Firms Prepare for New Accommodation Standards
Law Firms in Ontario are preparing for the January 1 deadline of compliance with new regulations stemming from the Accessibility for Ontarians with Disabilities Act. Firms with twenty or more employees are subject to the new rules, which require them to have clearly documented and readily available policies for providing equal access to legal services for people with disabilities. A variety of approaches are available to meet these regulations and firms have some flexibility through the broad terms of the legislation to enact policies as they see fit. Law firms have undertaken measures to update their communications, which include making both audio and printed materials available.
Law Society Report Urges Firms to Improve in the Promotion of Women
ALB Legal News
Private practice firms in Australia lag behind their government and corporate counterparts in the advancement of women, according to a recent NSW Law Society report. In the published findings, The Advancement of Women in the Profession Report and Recommendation, 46% of practitioners were women, but women only account for 23% of partners in large law firms. Barriers for women are more obvious in private practice than among government or in-house legal practices, especially due to the lack of flexible working arrangements in that sector and a stigma that surround those who work part-time. A potential solution posited to the problem is to encourage firms to embrace diversity as a business imperative of equal standing with the firms other goals.
Making Diversity Policies Work
Deborah Dalgleish, diversity and inclusion manager at Ashurst, explores regulatory changes to promote diversity that have been implemented in the past year and how law firms can keep up with these new regulations. She argues that implementing a diversity plan that is strongly supported by the highest partners in the firm leads to the best success, and that while many firms believe that they are promoting diversity, these new regulations will allow these to be monitored.
The Case Study Method and Harvard Law School
The Case Development Initiative held an event on December 2, 2011 to highlight the importance of the case study method to legal education. The event entitled “Thinking Differently: The Case Study Method and Its Relevance to Harvard Law School” attracted students, professors and academics from across the law school. Dean Martha Minow spoke on the history of the case method at Harvard Law School, how the method has evolved, and its future within the curriculum. Professor Ashish Nanda, faculty director of the Case Development Initiative, discussed his experiences using case studies in the classroom. The event was an opportunity to thank Dechert LLP, represented by Dan O'Donnell, and former Dechert CEO Bart Winokur for their support of the initiative. For more information on the Case Development Initiative please visit the program website.
Law and Business Students Learning From One Another
Professors John Coates and Guhan Subramanian of Harvard Law School’s Program on the Legal Profession were featured in a Harvard Law Bulletin article entitled Bridging Theory and Practice in Corporate Law. Professor Coates co-teaches a course at the Harvard Business School with Professor Jay Lorsch where 100 students—half from the law school and half from the business school—team up and try to solve corporate problems that real clients are likely to face in practice. Professor Subramanian similarly teaches a course to law and business students on deal-making and he states, “If every single course at HLS was focused on the practitioner’s perspective, I think we’d be missing something.”
Summer Theory Institute Alumnus Featured
Summer Theory Institute (STI) alumnus, Ben Hoffman 11’, is featured in the Harvard Law Bulletin for his work in setting up a Peru office of EarthRights International. The STI, sponsored through the Program on the Legal Profession, offers fourteen HLS students an opportunity to receive a summer grant to meet on a weekly basis and to discuss social and critical theory readings in relation to their public interest work.
Executive Education News
Harvard Law School Executive Education will host three information sessions on its program, Leadership in Corporate Counsel. The sessions will take place in India on January 10; London on January 27; and New York on February 2. For more information about the information sessions, please contact program manager Shironda White. In November, Harvard Law School Executive Education launched the inaugural program in its multi-year training program for Milbank associates. This first-of-its-kind professional development program was taught by faculty from Harvard Law School and Harvard Business School with the assistance of Milbank partners. Visit the Exec Ed website for more information on the following upcoming programs:
Editor: Daniel L. Ambrosini
Managing Editor: Nicola Seaholm
Contributing Editors: Amanda Barry, Nathan Cleveland, Hakim Lakhdar, Pavan Mamidi, Mihaela Papa, Erik Ramanathan
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