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April 08, 2006
The Joy of Work, Burned-Out Lawyers & the 1st "What About Clients?" Post
The past week was Pretrial Skirmish, Negotiation and General Posturing Week. Which I love. Lively chats with mainly worthy adversaries. You constantly learn new things about the law, the world, yourself. You get your client involved. Funny and even hilarious things happen, too. But one conversation was disturbing. It was with a lawyer with 20+ years of experience who cuts corners whenever he can, won't research anything, won't read anything, won't prepare for anything, and unabashedly disdains the law, lawyering, his client and, at this point, me. Having dealt with him before, I doubt he was just having a bad day. It's written all over him: he "wants out" of the profession, but doesn't know how to get out, won't get out. This reminded me of my first post dated August 1, 2005, and in part why I started this. The line was: "Do many of us wind up selling clients short because we are disillusioned or burned out?" How much of bad client service and the shoddy image many people have of lawyers is a function of lawyers disliking what they do? How many clients are getting hurt by it?
Posted by JD Hull at 06:31 PM | Comments (0)
France: Civilized, Educated, Talented, Proud - But Not Like Us?
As modes of work and workplace, including their definitions, keep changing, "work ethic" is never an easy subject. And France is my second favorite country. Justin Patten Human Law, in his very fine UK blawg, comments on a recent cover story on the future of France in The Economist. Recently, business-friendly French labor legislation, which lets employers to fire workers under 26-years-old without cause for the first two years of their tenure, has triggered demonstrations throughout France. The French have a 10% unemployment rate. Here is just one interesting excerpt from Justin's post about the article in The Economist:
1. According to the Economist, in a new poll whereas 71% of Americans, 66% of the British and 65% of Germans agreed that the free market was the best system of all, only 36% of the French believed this.
2. The Economist also cites that in one poll 3/4 of young French people would like to be a civil servant, mostly because it would mean a "job for life".
Amazing statistics--and had it not come from The Economist, I would not have believed them. But the French, like Americans, have a little of everything and everyone, do fight among themselves about ideas, and have a history of getting to the right answer in time. Still, these are disturbing numbers. How many of your clients so far this year asked you to help establish a sales or distribution office or light manufacturing plant in France with 20 to 30 employees?
Posted by JD Hull at 03:03 PM | Comments (0)
April 07, 2006
One GC's View of the Billable Hour.
In response to the Exemplar Law Partners post two days ago, James T. Holden, the General Counsel of Rhino Linings USA, Inc. in San Diego--a first-rate lawyer and litigator I've known for years who like me spent many years at BigLaw doing defense work--e-mailed me the following insightful comments on the Billable Hour. These are quite good, and on points re: the BH I didn't quite cover in the post. So Jamie graciously agreed to let us post them here:
Dan, I’ve been railing against hourly billing for years, for many of the reasons you cite. Two additional reasons, however, are these:
A. Hourly billing prevents a client from accurately budgeting, or even forecasting, what it is going to spend on legal services during a given year. I found that out my chagrin this year; just as I was literally preparing to submit my annual budget for approval, I got a ___ from ___ that forced me to seriously alter my anticipated costs for outside counsel. When I’m being held accountable for adhering to my budget, anything that is not predictable is bad; and
B. Hourly billing creates an inherent conflict of interest between attorney and client. The client wants outstanding legal services at the lowest price possible, i.e., in the least amount of time. However, a lawyer billing by the hour has no incentive to be efficient, and in fact has the incentive to be inefficient, i.e., take up as much time as possible. I think that might be one of the reasons for the “scorched earth” letters that often come from counsel, looking at every possible nuance of a given question.
C. One more thing: I was at a conference of the defense bar about ten years ago in Chicago, and was part of a panel that talked about changes in the legal practice over time. One of the senior attorneys, who started practicing before I was born, said that back in the day, lawyers would handle a case, try it to verdict, then send the client a bill at the end of the case for services. This was widely accepted, but resulted in a lot of variation in fees. It was the insurance companies that began to insist on hourly billing, both as a means of spreading the cost of defense over time and as a way to ensure that they were paying known amounts.
Ironically, it is the insurance companies who have been responsible for the huge assault on hourly rates, and who also stand in the way of reasonable fees for services. Of course, it’s also ironic that the insurance companies, by insisting on making lawyers slaves to the time sheet and billable hour, have essentially created a large causation factor in lawyer dissatisfaction, with accompanying increased rates of alcoholism and substance abuse, depression, and disability, all of which increase the indemnity payments these same insurance companies are forced to pay.
Jamie
Posted by JD Hull at 06:35 PM | Comments (1)
Catching Up With Exemplar Law: "No Hourly Bills, No Hourly Bull".
Boston-based Exemplar Law Partners made news in mid-February when it announced that it was launching a new firm which would use exclusively a fixed price model for corporate and high-end legal services. At the time, legal weblogs (see post here) reacted, and to this effect: (a) "great news, guys, and God speed" and (b) "if you can make this work, teach us how you did it--because we don't have a clue". Well, according to ELP's CEO and lawyer Christopher Marston, who I exchanged e-mails with last week, ELP is still kicking, practicing law and building the dream. ELP soon may have a blog of its own to give us a better view of this "next generation" law firm and laboratory for new ideas. If ELP starts up a blog, I'll subscribe. A few thoughts:
1. ELP is of course on to something. If fixed price corporate law models were adopted throughout the U.S., even as an evolving alternative to the billable hour, it would change the terrain a lot. For lawyers in firms which adopted them, the "12 Client Service Rules" I've discussed in this blog would be either much easier to follow or completely unnecessary since so may of them go (directly or indirectly) to the issue of controlling hours. No problem. I would be happy to blog about something else.
2. The Billable Hour ("BH") is: a business problem for clients simply because it needs to be controlled as a business cost; and a trust and confidence problem for clients and lawyers because it gets in the way of real relationships. In the wrong lawyer hands, especially in "one night stand" situations, BH chips away at value by encouraging unnecessary or inefficient work. It makes clients grumpy and often angry slaves in a "where will it all end?" game which lawyers, clients think to themselves, apparently need to survive.
3. For good reason, BH makes clients doubt lawyer advice--especially if the advice once taken requires lots more BH. BH is a main reason why relationships between clients and their time-keeping professionals everywhere tends to be quietly but bitterly adversarial. Maybe worst of all, BH contributes to the perception of business people that their business lawyers at some of the best business law firms just don't get business. If they bear no real risk, how could lawyers ever understand in their gut what we think and do? If they are dependent on hours, how can lawyers ever have our real interests in mind?
4. At some point, ELP's against-the-grain idea will work. A fixed price model for outside corporate lawyers makes business sense, and is both a winning and logical idea. ELP apparently has more than enough talent to make it work. Motivated Americans have a history of making "eccentric" good ideas work. And "no hourly bill, no hourly bull" is likely very compelling to business clients, who've been wondering all along when lawyers are going to "get it" and start thinking like business people. As a competitive device, it should threaten the hell out of a lot of us. It does me.
5. In implementing a new fixed price scheme, there are issues and pressures. You still have to make a buck and keep the doors open. You must survive. And cultural difficulties, too. Clients are wonderful but mercurial creatures. You've got to sell this to the very people who say they've wanted it along, but maybe never thought it through. Are corporate clients really ready for it? Will they think they'll be getting less?
So it's an experiment, and ELP is the lab. In having an alternative to BH that works, clients win big. And we business lawyers will need to do what our clients do: plan, decide, commit and share risks. If ELP is successful, the alignment of the client's and the lawyer's interests come closer together than ever before in our business.
Posted by JD Hull at 06:16 PM | Comments (0)
April 06, 2006
Del Bianco: AT&T - BellSouth Merger May Not Be a Done Deal.
Two days ago, Mark Del Bianco, a colleague, friend and a DC-based telecom lawyer who once labored in DOJ's Antitrust Division, wrote "Bumps in the Road for the AT&T-BellSouth Merger?" It's here reprinted from News.com. As usual, Mark's sober writing has triggered interesting arguments amongst the article's wonky readers plus a bonus gratuitous lawyer-bashing, free marketeer-mocking and my favorite, a reader-to-reader final comment: "To clarify matters further, you're a moron."
Posted by JD Hull at 11:09 AM | Comments (0)
April 05, 2006
Adam Smith: "Know Your Client."
Or at least get under its skin and come to know what it really thinks about you. You might be pleasantly or unpleasantly surprised. From Adam Smith, here's the post. As part of the larger and continuing conversation on correct client interviews and getting at the client's real attitude toward your services (see, e.g., Jim Hassett's fabulous summary and comments), Bruce MacEwen is referring to efforts by a partner at the Newcastle, England office of UK-based law giant Eversheds to employ methodogies of the consulting firm RAM (short for Relationships Audit & Management) to get the true answers. See Bruce's post on this always-important subject.
Posted by JD Hull at 05:53 AM | Comments (0)
April 04, 2006
Washington Post: Blogging is now a major player in Internet growth.
According to this morning's Washington Post, blogging is one of the the 3 biggest factors in driving Internet growth, along with local information retrieval and social networking. And traditional websites for now are taking a dive. Just see "New Trends In Online Traffic, reported by Leslie Walker and reprinted at MSNBC.
Posted by JD Hull at 01:49 AM | Comments (0)
April 03, 2006
Blawg Review #51's Writer is Nobody's April Fool.
George M. Wallace of Declarations and Exclusions, a/k/a A Fool In The Forest, did this week's Blawg Review with Blawg Review #51. We are lucky to have this literate, lyrical and whimsical host. Read Blawg Review #51 and then tell me if you still think lawyers are stiff, lame and uncreative. George's writing is Some Serious Dang Fun.
Posted by JD Hull at 03:40 PM | Comments (0)
3L Epiphany - Not Bad for a Buckeye.
As a basic Google search will tell you in a matter of seconds, 3L Epiphany, a blog by Ian Best, a third-year OSU law student and fellow Buckeye (ok, I claim a few jurisdictions), is both an inquiry into and catalog of the blawg phenom. 3LE has received a tremendous amount of kudos, press and hoopla lately--all well-deserved. See especially Ian's increasingly-famous Taxonomy of Legal Blogs. My comments: (1) this is both an impressive and interesting achievement and (2) why didn't I think of something this when I was 24?
Posted by JD Hull at 12:16 AM | Comments (0)