Law Firms, Ethics, and Equity Capital: A Conversation

The correspondence collected here represents an effort to start a conversation. Pending legislation in the United Kingdom, based on what is known as the Clementi Report, would permit non-lawyer equity investment in law firms, subject to regulatory oversight. In other words, UK law firms could become publicly-traded businesses. This legislation has been proposed as part of reforms heralded as improving the delivery of legal services to consumers. By contrast, such investment in law firms is forbidden by ethical rules in the United States. What will happen when the two countries with the most dominant global law firms begin to move along such different paths? Australia already allows such investment, but the prospect of major UK firms raising capital in the equity markets has the potential to produce seismic shifts in the global market for legal services. It also could have far-reaching implications for the legal profession that we can only dimly anticipate. Until now, there has been remarkably little discussion -- especially in the United States -- about the possible effects of the UK legislation. This paper attempts to redress that situation. It consists of an exchange among Bruce MacEwen, an expert on law firm economics and editor of the on-line publication Adam Smith, Esq.; Mitt Regan, a Professor at Georgetown University Law Center, an expert on the legal profession; and Larry Ribstein, a Professor at the University of Illinois College of Law, an expert on partnership law

2013 Report on the State of the Legal Market

As we enter 2013, the legal market continues in the fifth year of an unprecedented economic downturn that began in the third quarter of 2008. At this point, it is becoming increasingly apparent that the market for legal services in the United States and throughout the world has changed in fundamental ways and that, even as we work our way out of the economic doldrums, the practice of law going forward is likely to be starkly different than in the pre-2008 period. The challenge for lawyers and law firms is to understand the ways in which the legal market has shifted and to adjust their own strategies, expectations, and ways of working to conform to the new market realities. While there is certainly evidence that some firms and lawyers have begun to make these adjustments, many others seem to be in denial, believing (or perhaps hoping) that the world will go back to normal as soon as demand for legal services begins to grow again. Legend has it that in 1519, when he and his cohort of some 500 soldiers and 100 sailors landed on the shores of the Yucatan intent on conquering the large and powerful Aztec empire, Spanish conquistador Hernando Cortez promptly ordered his men to burn the ships. Cortez knew that, unless more tempting alternatives were removed, it would be difficult to motivate his men to take on an empire with a large army that had been in power for more than six centuries. Hence, his bold and decisive order. The legal market today is an increasingly difficult and challenging environment, one that calls for clear thinking, strategic focus, and flexibility in addressing rapidly changing realities. To an unfortunate extent, however, many lawyers and law firms seem stuck in old models–traditional ways of thinking about law firm economics and structure, legal work processes, talent management, and client relationships–that are no longer well suited to the market environment in which they compete. Perhaps it\u27s time for us, like Cortez, to burn the ships–to force ourselves to think outside our traditional models and, however uncomfortable it might be, to imagine new and creative ways to deliver legal services more efficiently and build more sustainable models of law firm practice. This report describes the trends that have been observed in the legal market in 2012, exploring the longer term implications of those trends for the future, and suggesting some ways in which lawyers and law firms can better position themselves to deal with new emerging market realities

Law School, Debt, and Discrimination

Law school is more than a professional training ground. Our graduates play a special and privileged role in the nation’s politics and culture. They know—or should know—the language of the law, the vehicle broadly capable of moving society from where it is to where it aspires to be, and ideally aimed at achieving justice in the case of individuals wronged by the state, a neighbor, or simple bad luck. This special role for lawyers adds significance to questions of who goes to law school and what law students do after they graduate. Law graduates’ career decisions have practical effects on access to justice; for example, new lawyers may choose to serve, or not to serve, poor, historically subordinated communities. Decisions about careers also link access to justice to student financing of law school. The more law students must borrow to pay for their education, the more pressure they are under to pursue higher-paying jobs to manage repayment. While empirical evidence of the impact of indebtedness on decision-making is scarce, the data we do have suggests that more borrowing for law school correlates with a lower likelihood of seeking a career devoted to the public interest. The correlation makes sense, because public interest careers tend to pay less. The more students must pay for law school, the more likely it is that they will seek more lucrative careers

From Gladiators to Problem-Solvers: Connecting Conversations About Women, the Academy, and the Legal Profession

Dissatisfaction permeates the public and professional discourse about lawyers and legal education. Diverse communities within and outside the profession are engaged in multiple conversations critiquing legal education and the profession itself. These conversations, though linked in subject matter and orientation, often proceed on separate tracks. One set of conversations explicitly focuses on women and people of color, centering on their marginalization and underrepresentation in positions of power. Those concerned about race and gender exclusion often participate in separate communities of discourse. Indeed, the symposium that spawned this article framed the inquiry about higher education in terms of gender. This exclusive focus on gender created a recurring tension in writing this article that stems from the incompleteness of gender as a critical framework. This tension, resolved unsatisfactorily by focusing on gender but continually noting the relevance of the analysis to race and class, exemplifies the failure of existing inquiry to bridge the concerns of women and people of color about law, legal education, and the legal profession. A second conversation questions the appropriateness of the values and goals of the prevailing legal educational mission. Some critics charge that traditional legal education trains lawyers to focus on the short-term, purely economic interests of those in power at the expense of thorough analysis and clients’ long term interests, and without regard to the impact on third parties and the community. Other critics focus on legal education’s preoccupation with rigorous, analytical reasoning and its failure to prepare future lawyers to meet the multifaceted, transactional nature of legal practice. Yet another conversation critiques the prevailing model of legal professionalism perpetuated by the traditional law school curriculum. These critiques are both instrumental, in their questioning whether the model of the legal profession embraced by law schools adequately prepares lawyers and the legal profession to deal effectively with the challenges of the twenty-first century workplace, and normative, in their examining whether reigning models of legal professionalism are morally and ethically justifiable. This article suggests that these conversations are related, indeed, interdependent. It builds from the critique of the gladiator model as a dominant, organizing framework of legal education and lawyers’ roles to find a synergy between the goals of those seeking to include women and those seeking to revitalize the profession to meet the demands of the twenty-first century. It explores the outlines of a problem-solving orientation to lawyering and legal education that has potential to address and create a dynamic between the concerns of women and the need to reclaim the soul of the legal profession. A move from gladiator to problem-solver may brighten both the future of the legal profession and the future of women and other underrepresented groups in the legal profession

Race and Law School: The Intersection of Obstacles for Aspiring Black Lawyers

Recent data of the legal profession have raised red flags about the lack of diversity in the field as compared to other career choices. Due to the fact that 4 of 5 lawyers are white, this leaves very little room for black lawyers to fill jobs in their desired positions. This paper first establishes the literary origins of the black lawyer and succinctly follows the progression made to the emergence of corporate law as an attractive legal sector for black lawyers and further analyzes the connection of the two. Using the survey data, the paper gathers and explains lived experiences of black law students and graduates and calls upon their struggles in their path as a black person in their respective institutions

Legal Profession

During 1967, the California courts made decisions dealing with admission to the bar, discipline, the statute of limitations in legal malpractice, and just compensation. The legislature also affected the legal profession by expanding the power of local government to employ private counsel, by changing the rules governing admission of out-of-state attorneys to the bar, and by changing certain fee provisions. The California Supreme Court decided several important bar admission cases. In Hallinan v. Committee of Bar Examiners and March v. Committee of Bar Examiners, the Committee of Bar Examiners made value judgments and, in effect, by refusing certification, attempted to punish past conduct of the applicants