Friday, December 14, 2012

Law Firm Survey 2012

Article by Drew Combs for American Lawyer

Despite uncertainty all around them, law firm leaders are optimistic about the year ahead, according to the American Lawyer annual survey. 

Leaders of the country's highest-grossing law firms are ready to put the recession behind them and embrace a cheerful narrative—if only the world economy will play along. In The American Lawyer 's 10th annual Law Firm Leaders survey, 75 percent of the 113 participating Am Law 200 managing partners and chairs described themselves as either somewhat or very optimistic with respect to their firms, a slight increase over 73 percent a year ago.

But financial instability in Europe, political and regulatory uncertainty in the United States, and the collapse of debt-laden Dewey & LeBoeuf remind them that the world can be a dangerous place. Seventy-one percent of respondents said they expect the economic recovery in the U.S. to either continue at its current plodding pace or slow down. (Only 29 percent predicted that the recovery would pick up next year.)

The results of this year's survey depict an industry that has moved on from the recession—one that has abandoned the large-scale cost cuts and personnel reductions that became commonplace in 2009 and 2010. But in the absence of a clear upswing in the overall economy (and subsequent increase in demand for high-end legal services), leaders of Am Law 200 firms have sought to maintain profitability increases by relying on small-scale tactics, such as capital calls, deequitizations, and increased use of alternative staffing models.

But despite the challenges, most respondents said they expect their firms to post increases to their bottom line in 2013. Nearly 32 percent expect partner profits to grow at their firm by more than 5 percent, up from 26 percent who said growth would top 5 percent a year ago. Forty-five percent expect profits to increase by 5 percent or less in 2013. 

The survey contained 59 questions covering a wide range of topics, including the U.S. and world economies generally, lateral activity, projected hiring by practice area and office, client relations, projected billing rates and profitability levels, discounting, and use of alternate fee structures. Full results are available at 

Thursday, December 13, 2012

Top Six Tech Issues of 2012 for In-House Counsel

Article by Catherine Dunn, Law Technology News

Adam Losey Attorney for Foley & Lardner talks about the Top 6 Tech isues from 2012:

The first case law on this issue emerged this year, with courts in New York, Virginia, and Louisiana greenlighting the application of computer analytics to discovery. And given how much money companies "waste" on discovery, says Losey, "it's really important to figure out ways to harness technology to do that better."

Data preservation will only continue to come under the microscope, says Losey. He recommends that in-house counsel implement a document-retention policy that spells out procedures for collecting and preserving email and other documents when a lawsuit hits. He also cautions counsel to be consistent; if you use multiple firms to handle preservation, differing methods could lead to inconsistences.

"Local jurisdictions and some states are adopting new rules to deal with e-discovery issues," explains Losey. His advice: "Make sure that the people you hire are really up to speed on this — or else they could wind up really losing badly."

There are plenty of potential blind spots when it comes to the many state and federal laws governing privacy. "If you're a company of any size, and you don’t have someone looking out for you on the privacy front proactively, you run a very serious risk of stepping on a landmine,” Losey says.

Frankly, most companies are terrible about digital security, because it's difficult to be secure," says Losey. One way companies can be vigilant is by hiring experts to test your network security. Losey also recommends opening up lines of communication between the legal department, and the IT department — including to those "who do the day-to-day grunt work," he says, since a crisis is no time to be making introductions between tech and legal. "If there's a data breach, it's the kind of thing that should come to the attention of in-house counsel."

Social media is presenting companies with a number of thorny legal and business issues — and companies shouldn't ignore the cyber-chatter. "It's a good idea for a company to proactively be looking online," says Losey. "What's out there? What are people posting about you?"On the business front, use the social media tools available to you to address negative comments. "A lot of companies do a really good job with that," says Losey. "But you don't want to not be aware that there's all kinds of bad press about you lingering, and you haven't taken an opportunity to respond."
In the legal domain of social media, keep an eye out for things like leaking of trade secrets — which could end up on an employee blog — and IP infringement happening via Facebook, Twitter, and the like. "If you're keeping general track of what's out there about your company, you're going to find out if someone's using your trademark," says Losey. "You're going to see if people are violating your copyright. And that's really important to know so you can stop it."

Wednesday, December 12, 2012

Technology-Assisted Review From the Plaintiffs' Side

Article by Henry J Kelston, Ariana J Tadler and Paul McVoy
for Law Technology News

For all the importance that lawyers place on being rational, they sure have a tough time when it comes to embracing technology.

We accept that a doctor can suture a human heart using a computer-controlled robot in an operating room thousands of miles away. We know that computers enabled NASA to land a spaceship gently on Mars after a trip of 255 days traveling more than 40 million miles. We have seen an "intelligent" computer win at Jeopardy against the most successful human players. Yet we resist public acceptance of the notion that computer analytics can, at least in large cases with masses of electronic data, identify documents relevant to a lawsuit more effectively than lawyers composing lists of keywords.

That the legal profession is notoriously slow to adopt new technologies is hardly breaking news. However, the resistance among current practitioners to even consider the use of technology-assisted review, especially in large complex cases, is a particularly confounding episode of techno-legal disconnect. Even more confounding is the resistance to engage in open dialogue about the possibility of using TAR to facilitate cooperative, efficient, and expeditious discovery.

It is clear by now that TAR, implemented correctly in cases involving large-scale document review, can significantly reduce the costs and burdens of discovery. The failure to consider and, in certain cases, implement TAR can no longer be justified given the demonstrated efficacy of currently available TAR programs in comparison to human review.  Attorneys who fail to inform themselves about TAR and consider its application in appropriate cases may impede rather than facilitate the just, speedy, and inexpensive administration of justice.
In the RAND study of e-discovery costs, the RAND Institute asked why, given TAR's "potential to reduce review costs without compromising quality," the technology is not being used by more litigants. After extensive interviews with key legal personnel at major U.S. corporations, RAND identified major factors inhibiting adoption of TAR as concerns about the adequacy of the tools to perform certain tasks, such as locating "smoking gun" documents or identifying privileged or confidential information, and the perceived risk of using an evolving technology in the absence of judicial guidance
There are other factors that may be impeding the adoption of TAR in litigation. RAND reported, for example, that "there may be concerns that, with disclosure [of the use of TAR], opposing parties might enlarge the scope of the demand due to a perception of lower costs." Of course, a party eschewing TAR for this reason may find the court unreceptive to the argument that the requested discovery would entail undue burden and expense because the party is using antiquated tools.
To provide excellent legal services in today's environment, deeper knowledge of TAR tools is essential, along with the practical experience to implement them properly. Not every litigator can be an expert in e-discovery technologies. But every litigator should know when to find one.

Tuesday, December 11, 2012

More Law Firm Mergers Ahead

Article by Debra Cassens Weiss, ABA Journal

In the last month, three law firms announced cross-border mergers

• K&L Gates is merging with Australian firm Middletons, creating a firm of more than 2,000 lawyers. The merged firm will have full financial integration and will carry the K&L Gates name.

• Norton Rose is merging with Houston's Fulbright & Jaworski to create a 3,800 lawyer law firm. The new firm will be called Norton Rose Fulbright.

• SNR Denton is merging with Salans and Fraser Milner Casgrain in a three-way merger. The new firm, which will be known as Dentons, will have more than 2,500 attorneys and professionals.

By the end of next year, predicts U.K. legal consultant Tony Williams, mergers will likely boost the number of law firms with $2 billion or more in revenues from five to 10.

Establishing new offices, rather than acquiring them in a merger, can be expensive, Williams points out. The cost of building a new office can cost between $5 million and $10 million a year, he tells the newspaper.