Posted Jul 23, 2013 10:45 am CDT
Most BigLaw firms will eventually collapse or reinvent themselves, leaving only 20 to 25 law firms catering to clients who are willing to spend without regard to budgetary concerns, according to one “common hypothesis.”
The New Republic airs the hypothesis in a lengthy story about “the escalating plight” of large law firms and how economic changes affected one firm in particular, Chicago’s Mayer Brown.
The story says there are currently between 150 and 250 law firms in the BigLaw club. “The overwhelming majority of these still operate according to a business model that assumes, at least implicitly, that clients will insist upon the best legal talent instead of the best bargain for legal talent,” the story says. “That assumption has become rickety. Within the next decade or so, according to one common hypothesis, there will be at most 20 to 25 firms that can operate this way—the firms whose clients have so many billions of dollars riding on their legal work that they can truly spend without limit. The other 200 firms will have to reinvent themselves or disappear.
“So far, the transition has not been smooth. In fact, the more you talk to partners and associates at major law firms these days, the more it feels like some grand psychological experiment involving rats in a cage with too few crumbs.”
The story describes earlier days at Mayer Brown. Partners and associates shared pastries in the morning and dined at Binyon’s in the evening, with the law firm picking up the tab. Associates who worked hard and did high-quality work ascended to partner in seven years. But “Mother Mayer,” as the firm was called, began to change after firms began to focus on profits per partner as the figures were revealed by the American Lawyer.
The firm saw disappointing profits after its acquisition of London firm Rowe and Maw, the story says. A debate began over unprofitable partners, and the firm de-equitized 45 partners in 2007. In 2008, the firm laid off 33 associates. Another round of layoffs followed in 2009.
The firm’s change to more of an eat-what-you-kill system in the 1980s also changed the culture, creating a competitive environment. “Chicago partners would fly into New York to poach clients from their Manhattanite counterparts,” the story claims, “holding clandestine meetings in which they would pitch themselves as less expensive and a mere two-hour plane ride away. When the New Yorkers invariably caught wind of these plots, they would remind clients that they were far more efficient than their Midwestern cousins.”
Associates, meanwhile, struggled with long hours, a longer road to partnership, and the need to pick a mentor, a difficult task “since partners constantly come and go or lose status within the firm,” the story says. And mentors sometimes become competitors. “Tales of partners gobbling up their younger colleagues’ clients are legion,” the story says.
The article says Mayer Brown chairman Paul Theiss “was at pains to transmit an upbeat image of life at Mayer Brown” when he spoke with The New Republic. Associates have a better chance of making partner than at competing firms, he said, and there is a premium on teamwork on cooperation. Laterals report they are happier with the firm’s environment, Theiss told the publication.
The article’s author says he was happy to concede that Mayer Brown was in many ways above average in terms of lawyer fulfillment. “That was, in fact, the point,” the story says. “If Mayer Brown is what passes for civility, then what should we make of the rest of the profession?”
Mayer Brown issued this statement in response to a request by the ABA Journal:
The New Republic article is titled “The Last Days of Big Law,” but as our chairman explained to the reporter, we disagree strongly with that conclusion. “Big Law” most certainly is not in its last days. Our profession is changing and evolving, and that is very different. Clients today are rightfully demanding that their law firms deliver an increased level of superior legal work, service, teamwork and value, and these attributes always have been, and are today, the defining characteristics of Mayer Brown.
The article presents a false impression of Mayer Brown through its reliance on comments and anecdotes from unnamed sources, most of whom are no longer with us. Many of these comments misrepresent the events described (most of which took place last decade) but are presented as facts, while the article ignores information, much on the public record and some that we provided, that paints a different and more accurate picture of our partnership.
More significant, however, is that an article that purports to discuss the future of the legal profession says almost nothing about Mayer Brown today. Missing is the fact that Mayer Brown today is a vibrant, collegial law firm in the midst of a very positive 2013 and with an even brighter future.
Our lawyers, both in the U.S. and globally, are more active serving clients than at any time in recent years. Accordingly, we have asked our new associates scheduled to begin work this fall in several U.S. offices to begin their careers with us early. The last two years also have seen a growing number of new colleagues join us because of the excellence of our reputation and the strength of our global capabilities.
We are, and always will remain, a firm where lawyers of exceptional talent choose to practice law at the highest level, and to grow and thrive. Our collaborative, team-focused culture enables us to help our clients more effectively than ever before across geographies and practice areas. And we continue to share a commitment to serving our clients with the highest degree of professional excellence. That’s the foundation on which our continued success as one of the world’s great law firms will be built.