Posted Jun 01, 2004 09:56 pm CDT
Fortunately, this is Forbes’ only client. He is general counsel for Gray Cary, a 400-attorney law firm based in San Diego.
Five years ago, Gray Cary implemented internal systems to avoid conflicts problems and make answers to ethical questions easier to get and more consistent. That led to the appointment of a firm general counsel, and Forbes, a 30-year veteran of the firm who had served on its professional standards committee, was the logical choice to fill the spot.
Gray Cary is among the growing ranks of law firms nationwide that are pulling lawyers off of revenue-generating work to serve as GCs. Historically criticized as poor managers, attorneys are realizing they need to structure themselves more like their clients do. “Originally, I was aware of one or two other firms with positions like mine,” Forbes recalls.
“Now, I know of at least 20 or 25 other firms with general counsel.”
“Law firms are pretty big businesses,” explains Ronald Van Buskirk, general counsel of Pillsbury Winthrop. A longtime litigator in the firm’s San Francisco office, Van Buskirk led the firm’s professional responsibility committee before becoming its first GC five years ago. He still maintains a private practice, though he says the balance is tipping towards his GC duties.
The most common questions for Forbes involve “positional conflicts”—when two partners represent major clients that are adversaries, and the firm must decline certain matters. “You don’t want partners left to themselves to figure it out,” he says. Forbes believes he was asked to be GC because he was long on respect from his partners and short on ego.
Forbes thinks one of his firm’s biggest benefits from his position is his ability to use attorney-client privilege to protect internal communications that might otherwise be subject to discovery.
Another advantage firms get is the continuing education GCs provide, adds Carolyn Cox, GC at Wilmer Cutler Pickering in Washington, D.C. “It’s part of my job to keep up with changes in [ethics] laws,” explains Cox, who got the job four years ago after serving as a longtime litigation partner and heading the firm’s ethics committee. As GC, she conducts ethics training for the firm’s new lawyers.
Law firm GCs should understand litigation, ethics, and employment and insurance law, Van Buskirk says.
Personality-wise, they should be fair and able to work within the partnership well. They also tend to be longtime partners, he adds.
Like any general counsel, law firm GCs must sometimes “farm out” matters when the firm would be better served by independent advisers. Van Buskirk sends malpractice and employment claims and complicated ethical questions to outside firms when Pillsbury Winthrop needs a second opinion from specialists.
GC compensation varies among firms. Van Buskirk says he’s compensated “as a senior partner in the firm,” and Cox says her salary “doesn’t depend on anything but the overall success” of Wilmer Cutler.
Forbes’ arrangement is more complicated. To bolster the argument for attorney-client privilege and preserve independent judgment, Forbes withdrew from the partnership. He earns a fixed yearly income plus a guaranteed deferred bonus and a discretionary bonus. The contract began as a three-year term and then became at-will. Should Forbes relinquish the GC position, he is guaranteed re-entry into the partnership. But Forbes says he plans to serve as GC for the rest of his career.
Cox, too, enjoys her position. “Because I’m not trying to divide my time between client matters, I really can drop whatever I’m doing when a problem requires immediate attention,” she says. “In retrospect, it seems like a no-brainer. Why didn’t law firms have this for so many years? The position makes perfect sense.”