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PLP Pulse: News from the Frontiers of the Legal Profession
October 2012
 

Globalization

Shanghai Bar Association Admits Foreign Lawyers as Special Members
The Asian Lawyer

Six years ago, the Shanghai Bar Association was the key advocate for strong protections against foreign law firm competition and was eager to “purify” the Shanghai foreign legal services market. This year, however, it became the first bar association in China to admit foreign lawyers and international firms as members. The benefits of membership are primarily a social and networking advantage and do not give members practice rights. The special memberships reflect a new balance between Chinese and foreign lawyers; many foreign firms have given up trying to compete during financial crisis and focus on outbound work.

Freshfields Broadens Focus in Euro Zone and Emerging Markets to Stay on Top
New York Times

Like many of its competitors, the London-based firm Freshfields Bruckhaus Deringer has experienced a drop in net profits since 2008, but adaptability and a focus on global strategy have kept the firm relevant and competitive. Freshfields is advising various banks and restructuring companies in the wake of the European debt crisis; according to Thomson Reuters, Freshfields has been involved in nearly 25% of European-related mergers and acquisitions in the first half of 2012. The firm has aimed to increase its cross-border business and worked to “stay at the front of the pack,” according to Freshfields worldwide corporate practice head Edward Braham, who also states that “about one third of what we’re doing now is connected to emerging markets” including China.

New Arbitration Center in Hong Kong
Channel News Asia

The China International Economic and Trade Arbitration Commission (CIETAC) established its first center outside mainland China—in Hong Kong. The government has been eager to establish Hong Kong as an international arbitration hub, and it expects increasing demand for high-end legal and dispute resolution services from Chinese enterprises going global. Rimsky Yuen, Hong Kong’s Justice Secretary, states, “As the mainland’s economic development continues to mature, more and more enterprises are going. There will be an increasing demand for high-end legal and dispute resolution services from these enterprises.”

The Changing Landscape of the South African Economy in a Global Market
American Lawyer

This past summer fifteen top South African corporate partners were interviewed by the American Lawyer as part of an in-depth report on the rapidly changing South African legal profession. In recent years, there has been heavy global investment in the region as international firms are drawn by the continued investor interest despite the global recession. Chinese companies signed $5 billion dollars in deals last year alone, and India announced similar plans for $5 billion in investments over the next three years. This rapidly changing landscape has particularly benefitted the three largest independent South African firms: Bowman Gilfillan, Webber Wentzel and Edwards Nathan Sonnenbergs Inc.



Diversity

ABA Formally Petitioned to Make Diversity the Responsibility of All Lawyers
National Law Journal

The Institute for Inclusion in the Legal Profession (IILP) recently sent a letter to ABA President Laurel Bellows asking the organization to amend its Model Rules of Professional Conduct. Their goal is to have the model rules include a provision stating that lawyers have an obligation to promote diversity and inclusion. According to the IILP executive director Sandra Yamate, it would be a formal way “for the ABA to meet its goals,” a reference to nonbinding Goal III, which calls for the elimination of bias in the profession and enhancement of diversity. An ABA spokesperson said “the proposal would work its way through the ABA’s legislative process.”

Diversity Report Highlights Lack of Diversity among Biglaw Firms in Texas
AboveTheLaw

According to the 2012 Law Firm Diversity Report, Biglaw firms in Dallas, Texas did not make the grade. According to the report, eighteen of the twenty largest firms in Dallas received failing grades on diversity and the highest grade overall was a C+. Only 1% of the 840 equity partners at these firms are black and thirteen of the firms have no African-American partners at all. Additionally, nine firms lack any Hispanic partners. The results are troubling for diversity advocates and corporate clients alike, as many companies are showing an increased interest in giving work to firms with a strong commitment to diversity.

Gender Differences in the Boardroom
Corporate Counsel

A new study from Harvard Business School explored whether men and women on corporate boards think alike in most respects. Men and women respondents were similar in their outlooks on top political concerns, corporate challenges to strategic growth, and concerns about talent management. The only gender differences that show up in their study relate to succession planning on boards, adoption of new technologies, and boardroom diversity. According to the study, 35% of women said “traditional networks tend to be male-oriented” compared to 21% of males who thought so.



Attorney Regulation & Ethics

Nonlawyer Investments in Law Firms
ABA Journal

Nonlawyer investments into and ownership of law firms is prohibited in every US jurisdiction, with the exception of the District of Columbia, which allows for it in a limited way. Australia, Canada, and the UK have already made changes to allow for nonlawyer ownership of law firms. US law firms doing business in foreign countries therefore must deal with how to reconcile flexible rules concerning business structures overseas. The ABA House of Delegates voted to postpone indefinitely a resolution to reaffirm that nonlawyers should not have an ownership role in law firms and should not share legal fees with lawyers.

Are Internal Investigations into Corporate Wrongdoing Good Enough?
New York Times

Companies are now responding to reports of corporate misconduct by pledging to cooperate with authorities and hiring law firms to conduct investigations. This arrangement is ideal for both government prosecutors and companies in that the government can avoid spending taxpayer money on investigations that may or may not lead to prosecution while the company retains control over information and protects itself from potential surprises. One suggestion is to expand whistle-blower programs that reward individuals who report corporate violations directly to the government.



Corporate Counsel

Broken Relationships between Firms and Clients
Corporate Counsel

A recent report by Acritas, a UK-based market research firm, investigates why law firms are losing important blue-chip clients. The reasons include poor quality work and sending too many invoices; poor service coupled with delays and disconnect between price and quality; and loss of partners from the firm who were managing the client relationship. One health care client reported, “[We stopped using them] mostly because of cost and efficiency” and “they put their own interests ahead of their client’s interests.”

Advice for In-House Lawyers from One Recently Acquitted
Wall Street Journal Law Blog

Lauren Stevens, formerly vice president and associate general counsel for GlaxoSmithKline PLC, was acquitted last year on charges of making false statements to the Food and Drug Administration. She recently expressed fears that her case signals the “criminalization of the practice of law,” and shared some advice for in-house lawyers who might feel targeted by the government. First, if you hire an outside firm, make sure they know all the facts, make sure they sign all the documents, and make sure other parties know you have hired outside counsel. Second, take accurate notes and recognize that they could end up in court or even newspapers. Third, be careful in your correspondence with adverse parties, and if possible, express your more zealous statements verbally and not on paper; statements on paper can be used in court and taken out of context.



Innovation & New Models

Solo Practitioners and Incubator Models
ABA Journal

As part of an incubator model, with an admissions process, the City University of New York School of Law offers solo practitioners the ability to rent Manhattan office space for only $500 a month in exchange for a commitment to work at least 12 hours per month representing underserved populations. The solos work at a rate of $75 per hour for up to 18 months. In addition to helping solos overcome the feeling of being on their own, according to CUNY law professor, Fred Rooney, “it’s also great for the lawyer because it offers a startup solo practice with guaranteed, paying clients.”

Jacoby & Meyers Starts Online Legal Forms Business and Continues Fight to Allow Non-Lawyer Investors
Wall Street Journal Law Blog; also see this related post

Even as the New York law firm Jacoby & Meyers redoubles its efforts to reverse a rule prohibiting outside investors in law firms, the firm is now entering the online legal forms market currently led by LegalZoom.com. Jacoby & Meyers new venture, LegalForms.com, will provide customers with access to legal templates and documents such as wills for a small fee. According to national partner Keith Givens, LegalForms plans to distinguish itself from LegalZoom by offering a three-tiered system that will allow clients to opt for inexpensive do-it-yourself forms; a mid-range service where clients use the do-it-yourself forms with some assistance from a Jacoby & Myers attorney; or the “full-service model” where the attorney handles the entire transaction.

Career Planning and Law School Innovation
The Huffington Post

Law schools can no longer only provide educational services that enable students to become legal professionals. In the current economic climate, law schools must also provide career support to ensure that students, upon graduation, are able to obtain a job and pursue a career. In order to encourage students to take advantage of its career services, Valparaiso Law School has created VOLT, an interactive website that provides career-tracking services to law students. At its core, VOLT is a checklist of steps students should take throughout their time at law school to land a job upon graduation. VOLT also includes job postings, the school’s calendar of events, newsletters, and the school’s LinkedIn site.

NerdWallet Introduces Law School Comparison Resources
New York Times

The financial website NerdWallet.com has launched a new education-related resource tool to compare law schools. Users of the website can choose up to four law schools and compare statistics such as class size, long-term employment figures, judicial clerkships, industry sectors, and salaries of graduates. One can also view longer ranked lists sorted by various categories and geographical criteria. The tool is designed to help prospective law school students choose a school based on career paths and where they want to live after graduation.



Law Firms & Practice Management

Law Department Spending on the Rise
Law Technology News

Companies around the globe are increasing their legal spending and approaching pre-2009 levels, according to a recent Harvard Business Review Consulting survey. The survey, now in its 26th year, reveals that both inside and outside counsel spending have increased in the past year. The survey follows two additional reports recently unveiled that also indicate increased legal spending among departments. The International Legal Technology Association (ILTA) and Inside Legal both indicate that technology spending at more than half the 114 ILTA firms has increased 2%, and that firms spending more than $26,000 per attorney rose to 9%.

Smaller Firms find it Easier to Make Deals
ThomsonReuters

The number of law firm mergers and acquisitions continues to climb but the trend seems to be towards smaller regional firms taking all the action. In a recent article from ThomsonReuters, three Florida firms were highlighted for their recent activity in the Southeast and along the East Coast. Where several of these transactions were handled by larger firms in the Northeast, these smaller Florida firms have recently acquired firms in New York, Virginia, and other parts of the state. The belief that larger M&A transactions are just too complicated has increased the appeal for these smaller firms to enter the race.

UK’s Biggest Law Firms Hire Senior Teams from Rivals
Financial Times

Some UK law firms are seeking to bolster their bottom lines by poaching other firms’ partners or teams who have established revenue streams they can bring with them. Sweet & Maxwell’s research finds that 64% of finance directors at the top 100 firms ranked by turnover said they were more likely to hire senior teams from rivals over the next year, compared with 29% last year. The practice is risky, however, when it uses methods like guaranteeing salaries over time; the role of guarantees in the collapse of Dewey & LeBoeuf is a case in point.



Legal Education

Preparing Law Students for Careers as In-House Counsel
Corporate Counsel

The cover story of November’s Corporate Counsel features a growing trend in legal academia—the value of experiential learning in preparing law students for the role of in-house counsel. At Harvard Law School, a new course entitled “Challenges of General Counsel” is being taught by former GC and secretary of General Electric, Ben Heineman and Professor David Wilkins, faculty director of Harvard Law School’s Program on the Legal Profession. The innovative course teaches law students about how GCs deal with complex legal and ethical problems at the intersection of law, business, and various other disciplines. Heineman states, “This is really a course about how to be a lawyer when the law is only part of any question you’re dealing with.” Similar courses are being offered at Stanford and Yale.

Legal Education and the Perfect Storm
Huffington Post

Legal education is at critical point, an almost “perfect storm”, thereby requiring an innovative outlook of where it will land in the next few years. In an opinion piece, Professors Oliver Goodenough and Rebecca Purdom of Vermont Law School reimagine what legal education could look like in the next few years, particularly with developments in the world of e-technology and distance learning. “Imagine a book that includes both content, access to a content guide (a teacher), and interactive games at certain levels to ensure that both knowledge and skills…grow as information becomes more complicated.” Legal educators need to be willing to experiment with new approaches and embrace opportunity for change.

Stanford Lands $7.2 Million Federal Grant to Support Afghan Legal Education
The National Law Journal

The US State Department awarded Stanford Law School’s Afghanistan Legal Education Project $7.2 million to assist in the creation of a law degree program in Afghanistan. The student-led Afghanistan Legal Education Project began in 2007 and has produced textbooks for Afghan law students and assisted in the development of certificate program in legal studies at the American University of Afghanistan in Kabul. The grant money will be used to create a five-year BA/LLB program at the same university. The grant signals an expansion in legal education in Afghanistan as well as a small but significant step in mending US-Afghan relations.

Law Schools Increase Recruitment amidst Dropping Applications
LJWorld.com

For the second straight year of declines, the number of people applying for law school admission fell by 13.7% in 2012. Nonetheless, the Kansas University School of Law announced earlier this month that it recorded a 19% increase in applications. Much of Kansas’s success can be attributed to their increase in out-of-state recruitment and a new campaign called “Change the Conversation.” The campaign involves informing potential students that a law degree does not have to lead to a traditional career such as an attorney for a law firm, and there are career paths with government, corporations, or nonprofit groups.

Economics of a Law School Education
New York Times

According to Professor Steven Davidoff of the Ohio State University Moritz College of Law, the type of law school reforms that best prepare students for the real world, such as smaller class sizes with practitioner-instructors, may actually increase costs. Reducing salaries of law school faculty would help bring down costs, but may end up reducing the quality of legal education, since highly qualified candidates with law review leadership or Supreme Court clerkship experience will likely be wooed to firms offering large signing bonuses for those sought-after credentials. Acknowledging the “qualitative difference between the top 15 law schools and the rest,” Davidoff addresses the idea that law school is a good long-term investment, pointing to statistics indicating that “the average lawyer will earn about $4 million—or twice as much as someone with a bachelor's degree—over their lifetime of employment.”



Public Interest Lawyering

Lippman Unveils Rule Detailing Bar Admission Pro Bono Mandate
New York Law Journal and New York Times

Chief Judge Jonathan Lippman unveiled a new 50-hour pro bono requirement for applicants to the New York bar. While current third year law students are exempt, first and second year students will have 34 months to fulfill the requirement. Hoping the mandate will “set the pace in the country,” Judge Lippman feels the change “makes sense, for new lawyers, for the profession as a whole, for the legal services providers, for the judges.” In order to qualify, the service hours must be law-related and within a variety on non-profit settings, including school clinics, government clerkships, and public interest groups.

Training Young Lawyers in Asia to Defend the Poor and Powerless
Christian Science Monitor

Bruce Lasky, a lawyer originally from New York, founded Bridges Across Borders Southeast Asia Community Legal Education Initiative (BABSEA CLE) 10 years ago to train young lawyers across the Asia-Pacific region to defend the poor. While law schools in Southeast Asia place little emphasis on helping the less fortunate, Lasky’s organization has worked with over 40 universities in nine countries to develop programs to teach lawyers the need for their services in at-risk communities. The group takes a neutral stance on politics to avoid conflict. Lasky tends to work within existing power structures instead of relying on donors with explicit human rights agendas.



Program Notes

Case Development Initiative: New Publication

The Case Development Initiative has released a new case series, Workers’ Rights in the Hudson Valley (A) & (B). The case series details the career path of two non-profit lawyers as they consider which organizational platform would allow them to have the greatest impact in the farm worker community in upstate New York. It highlights the challenges faced by lawyers in the public service sector as they adapt to the constrained resources that public interest law generally involves, reconcile personal and institutional values and objectives, and reflect on the opportunities and dilemmas posed by different options in diverse employment settings. Could a two-lawyer team successfully break out of an already-established organization to provide higher quality services, while at the same time obtaining funding and building the organizational infrastructure? The case allows participants to reflect on what is involved in starting up a legal organization from scratch—including the crucial foundational questions about funding, management, and strategic direction. The case is available for purchase at the Case Development Initiative website.

Executive Education: Emerging Leaders in Law Firms

Harvard Law School Executive Education will host Emerging Leaders in Law Firms, an intensive, five-day program specially developed for attorneys who have entered equity partnership within the past two years. As partners, this group of lawyers is taking on larger managerial responsibilities and is expected to exert greater leadership. The program offers them leadership and managerial perspective and skills to transition to partnership successfully. The program will be held at Harvard Law School from March 10 – 15, 2013. To learn more, visit the Executive Education website.

Executive Education: Leadership in Law Firms

Our flagship program, Leadership in Law Firms, offers law firm leaders insights into the challenges they face, and provides concepts and skills to be effective leaders. Participants in previous cohorts of our programs have been leaders of highly regarded law firms from around the world, holding executive positions such as senior partner, managing partner, chairman, practice group head, and office head. The program will be offered twice in 2013 at Harvard Law School, May 19 – 24 and September 8 – 13. For information please visit the Executive Education website.



Editor: Daniel L. Ambrosini
Managing Editor: Nicola Seaholm
Contributing Editors: Nathan Cleveland, Rachel Gibson, Nicholas Haas, Hakim Lakhdar, Pavan Mamidi, Mihaela Papa, Erik Ramanathan


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