Teaming up with the competition can pay off for small firms
Posted Jul 1, 2008 7:10 AM CST
By Margaret Littman
“Keep your friends close and your enemies closer.”
That’s the advice Sun Tzu gave his army in 400 B.C. And while large firms are not the enemy of small firms and solo practitioners, when high-profile clients start making noises about taking their business to a larger firm, it can seem that way.
Solos and small-firm lawyers who have held on to high-profile cases say one of their secrets is teaming up with a larger firm. Whether it is bringing on an outside attorney as second chair or tapping into a large firm’s resources or expertise, this strategy may be the best way to retain clients.
That was the experience of Richard A. Patterson, a partner with Owen, Patterson & Owen, a five-person firm in Valencia, Calif. His firm was one of the first to file suit against drug giant Merck & Co. in the Vioxx arthritis-drug cases in 2001. He estimates that Merck spent $1.9 billion defending Vioxx cases over a six-year period. In 2003, Vioxx was one of the most prescribed drugs in the U.S., meaning the potential impact was as big as Merck’s legal bills.
As the controversy surrounding the drug mounted, so did the publicity surrounding the case. Patterson says the small firm did well retaining clients when it had the opportunity to talk to people one-on-one. But when the cases turned to mass tort litigation, the firm looked to some of the larger firms for assistance. Instead of causing Owen, Patterson & Owen to lose some clients due to a lack of confidence, the move had the opposite effect.
“The association with major firms gave us instant credibility in the insurance community and in the legal community,” Patterson explains.
Atlanta’s B.J. Bernstein had a similar experience when she represented Genarlow Wilson, a 17-year-old who was sentenced to 10 years in prison for engaging in consensual oral sex with a 15-year-old.
Wilson’s case made national headlines and, in the end, led to a change in Georgia state law. But it began as a pro bono case on which Bernstein toiled for three years. When the case made the pages of the New York Times, she received offers of help “from all kinds of firms.” Instead of seeing those firms as competitors, she accepted their assistance.
Jay Jaffe of Chicago’s Jaffe Associates, a marketing firm that helps small and midsize law firms position themselves, is not surprised when corporate clients are pressured to move their business to a larger firm.
“If they are betting the farm, then the in-house counsel tends to look for bigger and bigger firms to cover their decision,” he says. “Then they can say, ‘We got the best money can buy.’ In focus groups, some general counsel have admitted that they would leave a small firm they worked with for many years for a bigger firm they had not worked with to avoid being criticized.”
The exception, he says, is when a small firm has a highly specific area of expertise. Bernstein has found that high-profile clients, including rapper Da Brat, have been referred to her by corporate firms that don’t have a criminal defense practice.
“When I was younger, I was more concerned that clients would go with a larger, more famous name,” Bernstein says. “I don’t worry about that anymore.”
When clients express concern about the size and breadth of experience of Bernstein’s two-attorney firm, she explains that every document passes by her eyes, not that of a summer associate. That’s typically all the reassurance they need, she says.
Indeed, Jaffe predicts that “virtual litigation teams,” with specialized talent from a number of different firms of all sizes, rather than reliance on staff from one megafirm, will soon become the norm. “It is not like a large firm has any advantage of technology, and small firms can be more nimble in the way they service the client,” he adds.