The “Partner” Paradox
May 31, 2005 | Filed Under General
DuPont’s legal model has long been focused on “partnering”. Law.com reports that DuPont wants to know whether “partners” on its matters are equity or non-equity partners.
A DuPont legal representative explains further:
“If the requested rate for an equity partner is $400 and the rate for a nonequity partner is also $400, I can ask whether it should be the same, given that one shares in the profits of the firm and the other is salaried.”
That’s one way to address the rising cost of legal services. Cisco might say go to door #3. Marty Schwimmer rightly wonders whether equity and non-equity partnership has any relation to quality of legal services.
I think part of the problem is that many modern large firms use the term “partner” rather generically. Some dole out non-equity partnerships like potato chips at a cocktail party. They seem to want to have it both ways: let the external client world assume a non-equity partner is a true owner of the firm, while internally treating her like an associate on steroids. Most don’t disclose the distinction on the attorney bio entries of the firm website, for example.
If my firm did work for DuPont, I would hope client wouldn’t need to pop this question, since I’d want them to know all relevant information about the firm attorneys and staff on the engagement. For $400/hr, that’s the least they should expect.
And only in the lexicon of lawyers could we use a term such as “non-equity partner” in a debate. Rather oxymoronic in the extreme, sort of like “jumbo shrimp” (thanks to George Carlin).
Checking Out a Book of Business
May 26, 2005 | Filed Under In the News, General
Law firms Coudert and Orrick are having a bit of a public dust-up over the latter’s hiring 11 of the former’s partners. The NY Times has the details. Orrick even has a news release.
Partners leaving one firm for another is scarcely news. But the NY Times article caught my eye when it mentioned a letter sent from Coudert to Orrick:
The letter raises the possibility of misconduct by the departing lawyers and by Orrick without explicitly accusing either of anything. The letter promises a review of e-mail messages sent by the departing Coudert partners and warns them not to try to woo clients away to Orrick.
I know there are ethical and perhaps legal constraints on soliciting clients from a former firm (no “wooing” even?). But the letter illuminates one point often missing in these “law firm scorned” situations: it is ultimately the client’s decision as to who the lawyer is.
It would be interesting to check back in a year, and see how many of Coudert’s former clients are now at Orrick. Or vice versa.
All the talk about a lawyer’s “book of business” sometimes obscures a simple fact: contained in each book are clients writing checks.
Updates: (1) good follow-up article on law.com–one possible reason for the departures is rather evident; (2) Prof. Larry Ribstein beat me to the punch and makes an excellent point about how the ethical rules may govern this dispute; (3) even more Coudert partners are hitting the “eject” button.
Straight Talk
May 17, 2005 | Filed Under Compliance, In the News
BP takes a decidedly un-lawyer-like step today and admits wrongdoing in the Texas City refinery accident in March that killed 15 people. Tommorrow’s Guardian reports the details of a corporate investigation that is uncommon in its speed and forthrightness.
A dedicated page on the investigation is available on the BP site here, including a PDF of the 47 page report.
Tomorrow’s Wall Street Journal notes ($) that:
The gravity of the report’s findings suggests that regulators may move to levy fines once their own investigations are complete. The report also appears to provide plaintiffs’ lawyers ample fodder for potentially costly litigation against BP on behalf of victims of the blast or their families. BP said yesterday it had started contacting families of the deceased, through their attorneys, to begin evaluating and settling claims.
This is an example of a company doing the right thing in the aftermath of a terrible accident. One can imagine significant internal debate about such a strategy; only a company with strong leadership could do what BP did today.
The Law Boat
May 4, 2005 | Filed Under New Services, General
In a development that gives new meaning to the term “offshoring”, the Boston Globe reports on SeaCode, a floating software design vessel:
Roger Green is a software entrepreneur. David Cook was once a supertanker skipper who spent 15 years hauling crude oil through the world’s sea lanes. Now the two men have announced a remarkable venture called SeaCode, a company that plans to hire 600 superb software designers from every corner of the world and house them in a luxury cruise ship just out of reach of US immigration law — but close enough to bid on multimillion-dollar US software contracts.
Not surprisingly, it’s mostly about the money. The WSJ reports online today in “Work in Progress” (in non-linkable fashion even for registered subscribers like me):
By setting up a team of engineers just offshore, executives will be able to check up on their projects without “killer flights to India.” SeaCode plans to pay its employees roughly three times what they’d earn in Bangalore, but still much less than a comparable American engineer’s salary. Workers will do four-month stints on the floating software factory, where room, board and laundry will be free.
Hmm… How long before lawyers from Mumbai trained in the English legal system are bouncing in the waves a short distance from Lady Liberty?
I don’t think this would ever be tried first by a law firm. An interesting discussion on that sort of innovation is going on between Ron Friedmann and Jeff Beard.
Time will tell if SeaCode ever sails. But there may just be a few icebergs on the horizon for those in the legal community who think that not innovating is really controlling risk.
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