South Korean Legal Market under Free Trade
Wall Street Journal
While the South Korean–United States Free Trade Agreement created much discussion about the trade of tangible goods, according to the Wall Street Journal its effect on the liberalization of trade in services—particularly legal services—was not widely addressed. Now that trade agreement is “starting to radically reshape the legal marketplace in Korea.” US and Korean firms will now be able to launch joint ventures, help companies grow, reform legal education, and help Korean lawyers to become critical thinkers.
India’s Largest Law Firm Reorganizes to Stay on Top
The Asian Lawyer
The strategy of the largest Indian law firm and one of the largest law firms in Asia, Amarchand & Mangaldas & Suresh A. Shroff & Co., has been to focus on growth at home and remain independent despite rising competition. In order to pursue this goal and prepare for the eventual opening of the Indian market to foreign competition, Amarchand embarked upon a major reorganization. This includes doubling in size from 550 lawyers to 1000 lawyers in the next five years, allowing non-family, non-partner members to join the management committee and reducing the family’s stake in the firm from 75% to 40%.
China to Become a New Venue for India-Related Arbitration
The Indian Ministry of Law declared that it intends to recognize and enforce arbitral awards made in mainland China and Hong Kong. This development is likely to make Hong Kong, currently a popular hub for China-related transactions, more attractive to Indian parties. Some observers argue that this move will challenge Singapore’s dominance as a venue for India-related arbitration, where India is the largest source of filings for the third year running. Others, however, highlight the extent of Singapore’s investment into arbitration infrastructure and disagree that Hong Kong could be as competitive without a concerted marketing effort.
Law Firms Capitalize on Asian Investments in Foreign Energy Assets
Asian Legal Business
As government-linked investment vehicles target foreign energy assets to supply Asian markets, there have been a number of legal challenges generating demand for legal work. The increased supply of natural gas in the US has driven natural gas prices to ten-year lows driving investment into the US. However, Asian-based investment funds, including the planned Indian sovereign wealth fund, need to be cognizant of US regulatory developments. According to Dennis Barsky, a Singapore-based partner at Jones Day, “investors are increasingly cautious from a liability perspective following the 2010 BP oil spill in the Gulf of Mexico, and the related legal fallout.”
Qualifying Foreign Law Practice in Singapore
In 2008, Singapore’s Ministry of Law introduced the Qualifying Foreign Law Practice (QFLP) program, which granted licenses to six foreign law firms to practice Singapore law; earlier this year the government announced that it would be accepting applications for new QFLPs. While the idea behind the policy was to enhance Singapore’s position as a global legal industry hub and create greater opportunities for Singaporeans, the QFLPs have been neither a major boost nor a hindrance to the Singapore legal market. The QFLPs may have played a role in increasing the number and size of international firms in Singapore. However, the initial QFLP firms only hired a small number of Singaporean lawyers, mostly foreign-qualified expatriates, and did not find QFLP to be critical for their practice because their primary interest remained cross-border deals and foreign laws.
The Argument for Foreign Lawyers in Australia
National and international law firms are pushing legal practice regulators to make it easier for foreign lawyers to practice law in Australia and avoid training requirements. The concern is that foreign lawyers will practice in areas of law that they are unfamiliar with. Firms have pressured Western Australia’s Legal Practice Board to create a certificate or rules that would ease the cost and process of giving non-Australian lawyers the right to practice law in the country. One idea involves restricting the area that lawyers can work in or which law firms they would be permitted to work with, accompanied by certificates. Training foreign lawyers in areas that they will not practice to be approved by the Australian government is a costly endeavor. According to the Australian, law firms hope that whatever regulatory changes are made in Western Australia will be replicated in other Australian states.
Greek Lawyers Need to Take Control
The Irish Times
Ken Murphy, director general of the Law Society of Ireland, explores the recent implications of the EU’s regulatory reforms imposed on Greece, Ireland, and Portugal to the legal community. He notes that many reforms such as allowing lawyers to advertise, prohibiting minimum fee tariffs operated by lawyers, and imposing a VAT on legal services do not affect Ireland as they have already been in place; they may be viewed as disastrous to Greek lawyers who have gone on strike.
Partners Lose Equity Stakes when Law Firms Fail
Wall Street Journal
As law firms file for bankruptcy or dissolve, some partners lose their equity stakes, which are large sums of money paid to the firm by a lawyer when he or she makes partner or joins the firm in a lateral move. When a partner leaves a firm, the investment is typically paid back over time, but if the firm is failing, the partner may not recoup the money. The issue is compounded if the partner leaves one firm in decline for another that also eventually fails. Such was the case for Andrew Ness, now a partner at Jones Day; he lost three equity stakes since making partner. Capital-loan programs allow partners to borrow money from their new firms during the period when their previous firms are paying them back, which can take as many as five years. Partners often have to pay their capital in advance, but according to Brad Hildebrandt, chairperson of Hildebrandt Consulting LLC, “partners [leaving failing firms] rarely get any capital back, they often have to write checks, and they rarely have any recourse.”
Transforming Professional Service Firms (PSF)
The Novack Druce Centre for Professional Service Firms at Oxford University has released a new study revealing that transforming PSFs from traditional partnerships to professionally managed businesses depends on two forms of power. These are power exercised by individuals in the firm, and power embedded in the firm itself. Transformation often involves changing patterns of authority to disrupt traditional rules and assumptions in the organization. According to Professor Tim Morris, “change must be embedded in the day-to-day routines of colleagues while avoiding the dangers of over-focusing on systems. Every step is inextricably tied to a form of power, and failing to utilize that power appropriately will result in failure.”
Permanent Changes after the Economic Downturn
Wall Street Journal Law Blog
The consulting firm Altman Weil released a survey of legal market trends. Increasingly, law firm leaders reported that changes in the industry since the economic downturn of 2008 will be permanent. In a dramatic shift, 84% of law firm leaders surveyed in 2012 reported that “more commoditized legal work” was a permanent trend, while in 2009, only 26% believed that trend to be permanent. Likewise, in 2012, 80% of those surveyed think that “more non-hourly billing” is here to stay, versus only 28% in 2009. In past years, many law firm leaders thought these changes were temporary reactions to the downturn; they now anticipate continuing adoption of other industry trends such as smaller first-year associate classes, lower associate compensation, and more contract lawyers.
Report on US Law Firms from IBISWorld Industry
San Francisco Chronicle
A report released from industry research firm, IBISWorld, reveals that due to the financial crisis that weakened many major law firms in 2009, many firms will continue to seek international expansion, M&A activity, outsourcing, and contract work. Despite the changing pay structure, industry revenue is projected to grow an average of 2.4% to $327.6 billion in the five years to 2017. IBISWorld estimates that 38% of industry revenue is derived from commercial activities; 18% from personal injury litigation; 14% from intellectual property; and 12% from property transactions.
Rise and Fall of Law
William Henderson, director of the Center on the Global Legal Profession at the University of Indiana, provides his perspective on what it will take for law firms to maintain their prominence and success during changing economic times. In his analysis of publicly available rankings of top law firms, Henderson observes that the past twenty-five years have witnessed a meteoric rise in firms’ stature as service providers, but cautions that times are changing. Since 1986, the total gross revenue for the Am Law 100 increased from $7.2 billion to $71.0 billion—an 886% increase.
Online Course for Master’s Degree Now Offered at Major Law School
New York Times
Washington University Law School recently announced plans to offer an entirely online master’s degree for lawyers practicing overseas. The legal profession has been slow to adopt online classes, but there is hope that this new partnership between Washington University Law School and an education technology company, 2tor, will begin to shift that focus. The ABA’s rules permit only 12 credits of online classes to count towards a JD degree, which has been a hurdle in teaching law school classes on the web. Dean of Washington University Law School, Kent Syverud, said that students completing this program “will receive the same quality of classes we deliver in St. Louis,” and that the program is designed to increase accessibility to those “who cannot uproot their lives to come to the US.”
Repairing the Economics of Legal Education
New York Times Opinion Pages
Legal education is broken from an economics perspective, according to Professor Brian Tamanaha of Washington University Law School. He contends that the cost of obtaining a law degree is vastly out of proportion with employment opportunities currently available to graduates. As a result, some new lawyers are unable to earn enough to make their monthly debt payments. The two major factors for this are federally guaranteed loans that incentivize schools to raise tuition, and the inflexibility of ABA accreditation standards that limits differentiation among law schools. “If we don’t change the economics of legal education, not only will law schools continue to graduate streams of economic casualties each year, but we will be erecting an enormous barrier to access the legal profession,” says Tamanaha.
Going Against the Grain: Alaska to Start New Law School
The Wall Street Journal
Alaska is the only US state without a law school, but that is about to change soon. The University of Seattle and University of Alaska are teaming up to start a JD program. Paradoxically, this comes at a time when there has not been a significant increase in the number of jobs added to the market for lawyers. Support for the initiative to start a law program in Alaska comes notably from Alaskan Supreme Court Chief Justice Walter Carpeneti and Chief Justice-Elect Dana Fabe who believe the initiative promises to offer a legal education to all Alaskans and increase the diversity of the Alaska bar.
Most-Cited Law Review Articles
Wall Street Journal Law Blog
A recent study authored by Fred R. Shapiro and Michelle Pearse published in the Michigan Law Review determined the 100 most cited law review articles of all time. Shapiro tells the WSJ Law Blog that in recent years intellectual property has been a “hot area” as has corporate law. He noted that there is no correlation between the number of citations in journal articles and court filings. The three most cited articles of all time are: (1) R.H. Coase, The Problem of Social Cost, 3 J.L. & Econ. 1 (1960); (2) Samuel D. Warren & Louis D. Brandeis, The Right to Privacy, 4 Harv. L. Rev. 193 (1890); and (3) O.W. Holmes, The Path of the Law, 10 Harv. L. Rev. 457 (1897). Overall, the top 100 were made up of 36 articles published in the Harvard Law Review, 18 in the Yale Law Journal, and 10 in the Stanford Law Review.
Reactions to New York’s New Pro Bono Requirement
New York Times
New York Times readers are weighing in on the recent op-ed Rethinking Pro Bono by Ben Trachtenberg, in response to a new requirement that lawyers joining the New York State bar must complete 50 hours of pro bono service. Those with reservations about the new requirement argue that the rule takes the focus off senior lawyers who should be actively participating in pro bono throughout their careers; is burdensome for part-time night school law students who are already busy with work, school, and family obligations; is not strong enough and does not represent true systemic change; and creates a situation where young lawyers are not experienced enough to perform pro bono work effectively and may end up working without mentors or proper supervision. Those applauding the measure say it provides essential services and access to justice for low-income New Yorkers who go unrepresented in matters ranging from divorce to foreclosure; encourages firms to participate more in pro bono; and serves as valuable training for law students.
Commencement Speaker Urges Grads to Help Real People, Make Lasting Impact
Professor Lawrence Lessig of Harvard Law School delivered the commencement address to the John Marshall Law School this spring where he urged new graduates to help fix the legal system by working for ordinary citizens. He cites the number of students who came to law school looking to do justice but then end up working for corporations. “No doubt, this is an honorable and important part of our profession,” says Lessig, ”but there is a missed opportunity for lawyers to have a greater social impact.” He envisions a legal system that works as efficiently and tirelessly for “real people” seeking help with seemingly small issues such as eviction hearings or insurance claims cases as it does for multi-national corporations. To realize the vision he challenged the John Marshall graduates to pursue work that improves the legal profession and earn respect “for what you did, for who you became, for how you left the world.”
Regulation in the Legal Profession Preventing Necessary Development
Wall Street Journal
In this opinion piece, Clifford Winston and Robert W. Crandall of the Brookings Institute in Washington, D.C. argue that regulatory barriers are keeping the legal profession from evolving in a more positive and productive way. In-house counsel is increasingly being used to reduce costs for large clients and the public is becoming more resourceful when it comes to solving their legal issues. The overall management and structure of today’s law firms will shape tomorrow’s legal profession. The possibility of deregulation in certain areas of law firm management might allow for improved financial management of firms, increased available capital, a more globalized legal community, and ultimately an increased reliance on outside legal help.
Justice Minister Advocates for Change in South Africa
Mail and Guardian
Justice Minister Jeff Radebe recently called for reform of the legal profession in South Africa, highlighting the need to examine the state’s legal services. According to Radebe, the government needs to rethink the way in which it obtains legal services and who represents it in legal matters. Radebe observed that race is an important aspect of the legal profession in South Africa, as it is difficult for black advocates to gain exposure and the requisite skill to compete in certain areas, particularly commercial law.
Mobile Technology Encourages Work outside the Office
The legal industry is addressing the influence that changes in mobile technology have had on the profession and on physical space requirements in the workplace. According to editor-in-chief of Law Technology News, Monica Bay, “the possibility of working remotely has been with us for a while now, but what’s changed is that it’s no longer just for business trips or staying home with sick kids.” These trends are causing firms to reconfigure workspaces while they adjust for more flexible work schedules, thereby creating less need for big offices and excessive overhead costs.
Leadership in Corporate Counsel Program
Harvard Law School Executive Education will host its fourth cohort of Leadership in Corporate Counsel on June 20–23, 2012. Leadership in Corporate Counsel is the first executive education program tailored specifically to general counsel and chief legal officers. GCs from the world’s leading corporations are expected to attend the three-day event, which will be held on the Harvard Law School campus. Participants will develop a holistic understanding of the challenges facing, and the skills and perspectives required of, effective corporate counsel leaders. For more information, visit our website.
Leadership in Law Firms Program
Harvard Law School Executive Education is accepting applications for Leadership in Law Firms, which will beheld September 9–14, 2012. The program brings together leaders from the world’s top law firms to discuss the challenges they face in leading these organizations and developing the skills and perspectives necessary to lead in a competitive environment. For more information, visit our website.
Milbank Tweed Associates Program
Harvard Law School Executive Education organized four training programs for Milbank, Tweed, Hadley & McCloy associates this academic year. This first-of-its-kind professional development program is taught by Harvard Law School and Harvard Business School faculty, and aims to aide associates in further developing expertise and skills over the course of their careers. For more information, visit our website.
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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