Legal Profession Blog

The Innocent Insured Attorney

The New Hampshire Supreme Court has reversed and remanded a decision to rescind a law firm's professional liability insurance for an allegedly false statement on the policy application.

The matter involved the misappropriation of estate funds by a law firm partner.The other partner was not aware of the thefts, although his conduct facilitated the theiving partner's access to the entrusted funds. The two lawyers had been partners for over 45 years.

The court held that the knowledge of the bad partner could not be imputed to the innocent one under its interpretation of the "innocent insured" provision of the policy.

Our earlier coverage of a suit by the disbarred attorney's spouse against a Nixon Peabody attorney is linked here. (Mike Frisch)

When Law Partner Spouses Divorce

When a married couple enter into a law partnership, the divorce and resulting termination of the partnership is likely to wind up as a published opinion. The lawyers married in 1987 and commenced the partnership in 1988. The partnership lasted about a year before one spouse (here the plaintiff)left the partnership. A divorce action was filed in 1999.

After the divorce, one spouse sued the other claiming that the fee-splitting agreement that was incorporated into the decree covered workers compensation matters as "personal injury" cases. The claim, if sustained, would have entitled that spouse to a share of fees. The Connecticut Supreme Court agreed with the lower court that collateral estoppel (from the divorce) barred the claim.

A dissent would find that the issue in the present litigation was not barred by collateral estoppel and that a trial on the merits should go forward.

(Mike Frisch)

Part II: How most law firms misapply the "Cravath system"

[Posted by Bill Henderson, cross-posted to ELS Blog]

In my last post, I discussed the linkage between the bimodal distribution and the emphasis on credentials under the "Cravath system."  I also stated that most law firms misunderstood the internal logic of the original Cravath model and promised to elaborate in a subsequent post.   This is the promised entry. 

One note of context:  this post is not a history lesson.  The Cravath system reflects a profoundly powerful method of developing human assets.  Cravath started with very good associates/inputs  and turned them into truly exceptional lawyers who were in high demand by clients and other firms.   Moreover, the Cravath system required lawyers to work together collaboratively to further the clients' interests.  This resulted in efficient and highly effective legal services that engendered the abiding loyalty of clients and more demand for the firm's services. See Results or Résumés at 4 & n. 13 (discussing concept of firm-specific capital). In other words, under the true Cravath system, everyone comes out ahead. Two caveats:  (1) the first-mover--here, Cravath 108 years ago--garners the most benefit; (2) if a firm neglects a key element--e.g., investing in associates--the model generates no competitive advantage.

[Sources: The Cravath system described below come primarily from Robert Swaine's 1948 history of the firm and other contemporaneous sources from the 50s, 60s, and 70s, which I will cite as appropriate.]

Recruiting Elite Law School Graduates

One of the hallmarks of the Cravath system is the recruitment of elite law school graduates.  As of 1948, Cravath, Swaine & Moore and its predecessor firm had employed a total of 454 law school graduates as associates.   Of this total, 67.7% attended Harvard (128), Columbia (124), or Yale (54).  According to Swaine, "in recent years there has been an increasing number from the law schools of the Universities of Virginia and Michigan."  These two schools rounded out the top five :  (UVA 30, Michigan 26).

Cravath's emphasis on credentials, however, had a clear economic logic that was designed to compensate for the deficiencies of early 20th century legal education.  During this period, most law schools required little or no college education.   In contrast, Harvard, Columbia, and Yale grads typically had a college degree before entering law school.  Swaine writes,

Cravath believed that disciplined minds are more likely to be found among college graduates than among men lacking in formal education ... .

Cravath believed in seriousness of purpose--a man with a competent mind, adapting to practicing law according to Cravath standards, should have made a good scholastic record at college.  But he recognized, without full approval, the tradition of the early decades of this century--that "gentleman" went to college primarily to have a good time and make friends.  Hence, while a good college record was always a factor in favor of an applicant, lack of such a record was not necessarily an excluding factor. ... [I]n the stern realities of the depression of the '30s, however, college records of applicants came to have added importance.

Yet, "[f]or a poor law school record Cravath had no tolerance."  Candidates who "had not attained at least the equivalent of a Harvard Law School 'B' either had a mind not adapted to the law or lacked purpose and ambition ... ."  Thus, the "first choice" was a "Phi Beta Kappa man from a good college who had become a law review editor at Harvard, Columbia or Yale."

Note, however, that Cravath's emphasis on credentials had a clear business purpose designed to compensate for the limitations of legal education.  During the first half of the 20th century, going to an Ivy League law school did not guaranteed legal aptitude. Prior to advent of the LSAT in 1948, college grades were the only predictors of success in law school.  In 1955, The "LSAT Handbook" included cross-tab tables of LSAT scores versus law school performance for several individual law schools.  At Harvard Law, roughly 1/3 of the class scored below the 50th percentile.  On the west coast, UC Berkeley had a similar wide range of LSAT scores.  See The Law School Admission Test and Suggestions for Its Use (ETS 1955).  The clear relationship between LSAT and grades subsequently  encouraged law schools to revamp their admissions criterion.   But that process took decades.  See Lunneburg & Radford, The LSAT: A Survey of Actual Practice, 18 J. Legal Educ. 313 (1965).

In a talk at Harvard Law School, Cravath stated that a successful "lawyer of affairs" (aka corporate lawyer)  assumed "the fundamental qualities of good health, ordinary honesty, a sound education and normal intelligence."  On top of these attributes, a candidate must have "character, industry and intellectual thoroughness, qualities that do not make for charm but go far to make up that indefinable something that we call efficiency.  Brilliant intellectual powers are not essential."

More after the jump ...

Developing Human Assets

Under the Cravath system, the inputs themselves (i.e., qualified associates) had little value to clients.  Rather, they needed to be trained by the investment of intensive training.  Over a period of years, that investment created the remarkable efficiencies and superb quality that bonded clients to the firm. 

The Cravath system was build upon an incentive structure that encouraged young lawyers to acquire skills at an optimal pace. Further, the firm was intent on inculcating its superior work habits. "Cravath believed that a staff trained within the office would be better adapted to its methods of work ... and hence he insisted that the staff be recruited,  so far as possible, from men just out of the law schools."  Cravath also ended the practice of associates having their own clients and working on firm's matters in exchange for a desk room.  "Cravath could not tolerate the inefficiency and divided loyalty implicit in such an arrangement. ... [E]very associate, including the man fresh from law school, was put on a salary."

Once in the firm, associates where placed on matters in a way that rounded out their professional training.  According to Swaine,

Cravath preferred that men should not specialize in such branches of the law as real estate or administration of estates or, later, taxation, until they had attained a general experience over several years.  This objective required that a man should not be confined to the work of one client or be assigned to one partner for any undue length of time. 

At the outset of the practice Cravath men are not thrown into deep water and told to swim; rather, they are taken into the shallow water and carefully taught strokes.  The Cravath office does not follow the practice of many other offices of leaving small routine matters entirely to young men fresh from law school without much supervision ... .  Under the "Cravath system" a young man watches his senior break a large problem down into its component parts, is given one of the small parts and does thoroughly and exhaustively the part assigned to him--a process impracticable in the handling of small routine matters. Cravath believed that a man who learns to analyze the component parts of a large problem involving complicated facts, and to do each detailed part well, becomes a better lawyer faster than the man who is not taught in such detail.

As the professional competencies of associates grew, their level of responsibility increased.  Ideally, these competencies included the ability to effectively delegate, supervise, and train other lawyers.  Swaine observed, "The art of delegation in the practice of the law is difficult, requiring the nicety of balance which many men with fine minds and excellent judgment are unable to attain.  ... The more nearly he attains the right compromise between [doing all the work himself or turning everything over to an assistant], the greater the amount of effective work a man can turn out, and hence the greater his value to the firm."

Obviously, the Cravath system as conceived by Paul Cravath envisioned a process that spanned several years.  Therefore, "[m]en who are willing to stay only a year or two are not desired, for the 'Cravath system' cannot train a main in that short time.  They are expected to remain as long, but only as long, as they are growing in responsibility."  In today's high attrition environment, this temporal component has been completely disrupted at most firms.

Another tenet of the Cravath system was up-or-out after six to ten years, primarily because a "man who is not growing professionally creates a barrier to the progress of younger men within the organization ... . It is much better for the man, for the office and for the clients that he leave while he still has self-confidence and determination to advance.  The frustrated man will not be happy, and the unhappy man will not do a good job."

Sustainability

The genius of the Cravath system was the interlocking incentives that made the model sustainable:  every person involved in the process--associates, partners, clients-was made better off.  In the case of associates who were not destine for partnership, Swaine reported:

The firm constantly has requests from clients and other leading industrial and financial organizations to supply men for legal and executive positions.  Other high-ranking law firms of the City and elsewhere have taken Cravath men as partners; many Cravath men have formed successful firms on their own [many of which are now Am Law 100 firms]; and quite a number have become members of law faculties.  It is often difficult to keep the best men long enough to determine whether they shall be made partners, for Cravath-trained men are always in demand, usually at premium salaries.

Almost without exception, the relations between the Cravath partners and the men who have left the office to compete professionally have remained friendly, and often intimate.  Cravath partners take great pride in the success of alumni.  ... [N]ew business if often referred to former associates.

One such Cravath alumni was Charles Reich, a Yale law professor who gained fame for the influential book, The Greening of America (1971).  One of Reich's close friends recently took at job at Cravath, Swaine & Moore, and Reich used the occasion to reminiscence on this own experiences.  It a letter to his friends daughter, which was subsequently published in The American Lawyer in December 2007, Reich's relates impressions strikingly similar to Swaine's account:

In the Cravath of 1952, I felt no pressure whatever concerning billable hours. ...  The only pressure was to complete an assignment on time. ...  We were all told that while few associates could expect to remain permanently at the firm itself, we could all count on well-paid future employment at one of the many corporate legal offices or regional law firms that had ongoing relationships with Cravath. The message was: Excellent work is expected, but the pressure is off. Associates were safely and comfortably on the inside for life.  Inclusion was more important than competition.

In the terrific book Lions of the Street (1973), journalist Paul Hoffman quoted another former Cravath associate, who observed, "The [Cravath] fraternity takes care of its own. ... Nobody starves."  Going to work for Cravath and following the program guaranteed a certain minimum level of professional success. And that minimum was, in the bigger picture, pretty darn high. Further, with some luck, you could become partner at Wall Street's most renowned firm. 

Interlocking Incentives for Partners

It is noteworthy that the Cravath system reflected a business philosophy that encompassed the entire firm, including the partnership.  According to Swaine, "Probably the most rigid feature of the 'Cravath system' has been insistence that for every man in the office, from the senior partner to the neophyte law clerk, the practice of law much be the primary interest and that that practice shall be solely as a member of the Cravath team." Associates and partners were trained in the tradition that:

All the business in the office much be firm business.  ... The problem of the firm is to do effectively the business that comes to it; by so doing that business, more comes in.  Hence, business-getting ability is not a factor in the advancement of a man within the office at any level, except in so far as that ability arises out of competence in doing law work ... .

Every partner is expected to cooperate with every other in the firm's business, through whichever partner originating, and to contribute to all the work of the firm to the maximum of his ability. The formation among the partners of cliques practicing independently of each other, which developed under Gurthrie [a partner who left the firm in 1906], would not be allowed today.

To maintain this interlocking system of incentives toward high quality work product, Cravath very rarely hired lateral partners or associates. Thus, "Young partners and young associates are seldom subjected to the discouragement of seeing someone come in over them from the outside." [A Cravath tenet broken by most law firms today.] Swaine also claimed that the firm discouraged work habits that crushed interests outside the law.  "Cravath wanted his partners and associates to have such interests, and believed that the few who allowed office work to pre-empt all their energies where harming themselves and the firm."

The Cravath firm history has a interesting passage on the the firm compensation system.  Today, Cravath Swaine & Moore is often cited as one of the few remaining examples of lockstep compensation, in which a partner's profit share is a function of years with the firm.  See, e.g., Paul C. Saunders, When Compensation Creates Culture, 19 Geo. J. Leg. Ethics 295, 296-97 (2006) (partner at Cravath Swaine and Moore discussing deleterious effects of eat-what-you-kill compensation system and noting "[m]y firm's model for partner compensation is, and has been for a very long time, completely based on the lockstep approach.").  Yet, the passage excerpted below suggests, at best, a modified lockstep approach:

Attainment of partnership does not mark either the limit of potential growth or accession to any automatic hierarchy.  The younger partner who evidences capacity to win the confidence of clients with whom he or she works so that they continue with the firm, or impresses others who come into contact with his work so that other business comes to the firm through him, and who takes responsibility for a number of varied matters, at the same time supervising the work of members of the staff and sometimes of other partners, may well raise, and indeed often has risen, with the firm more rapidly than his seniors.  The partners are judged inter se just as are the associates, and adjustments are made to reflect the evaluation of the young partners by their seniors.

My co-author, Marc Galanter, tells a story--possibly apocryphal--that the Cravath partners approached Paul Cravath about the possibility of moving to a pure seniority-based compensation system.  Cravath stated that he had no objection to the proposed plan, "as long as I get my half."  I have no idea if this story is true, but it is (a) amusing and (b) consistent with idea that rules required to build a franchise may be very different than those required to maintain it.  Certainly, the lockstep system may be the best way to preserve a cooperative ethos at a firm that has earned the top position in the market.

Conclusion

One objection of my above characterization of the Cravath system is that I have been too willing to accept, at face value, the words of Robert Swaine and Paul Cravath--that these lawyers are spinning the history to show themselves in their desired light. I understand the criticism but I think it is premature and possibly misguided.  The best way to ascertain the reliability of Swaine's historical account is to examine the various pieces of the Cravath system and ask ourselves if it holds together as a theoretically coherent model.   I think it does.  Occasionally an accurate historical account is going to be the most flattering.

In a future post, I will discuss how the logic of the Cravath system mirrors the findings of the famous Bell Labs study, which documented that organizational productivity was a function of teachable work strategies rather than the credentials or innate abilities of individual engineers.  Further, under the Bell Labs system, women and minority engineers tended to post the largest gains--a finding that should give the legal profession pause.   See Results or Résumés.

Follow Up to Career Advice - In-House Prospects

Orin Kerr graciously linked from the Volokh Conspiracy over here to the litigation versus corporate career post.  I want to return the favor by linking back to a set of comments being posted over there.  The same over at Above the Law.  There are a number of thoughtful comments out there. 

One of the themes being discussed is whether it's easier to move in-house if you've been a transactional lawyer or a litigator in-house.  I don't have any idea what the data is on this, but my philosophy as a general counsel, unless I was hiring for a specific specialty, like a litigation supervisor, an HR lawyer, or a patent lawyer, was to look for the best available athlete, and I had a track record of hiring both transactional and litigation lawyers to be divisional or business group GCs.

Many leading GCs are or were former litigators, including Jeff Kindler, first at McDonald's and then Pfizer (and now CEO of Pfizer), Peter Kreindler at Honeywell, Don Kempf at Morgan Stanley, Paul McGrath at FMC Corp. and then American Standard, and the list could go on and on.  John Donofrio, the GC at Visteon, and Bob Armitage, the GC at Eli Lilly, are patent lawyers by background.

I think many of the comments reflect something I suggested before, which is how hard it is at the bottom of the heap to experience what it's like to be a senior lawyer in either specialty.  For example, the communication skills you learn as a litigator translate nicely into talking publicly to a board or in a negotiation.  A congenial personality works well in front of a jury as well as in a boardroom (the six or twelve lay people in either environment tend not to like assholes any more than anybody else).  One of my mentors at Dykema, now retired, Don Young (Harvard '63 I think) had a fearsome reputation both internally and externally (as a summer associate I drew a cartoon of an associate who looked like he had just put his finger in an electric socket; the caption had him saying to another lawyer, "Don Young just reviewed my research memo"), but in front of a jury he was the embodiment of Mr. Charm.  Fortunately, despite the fearsome reputation, he also had a sense of humor and an appreciation for chutzpah in young lawyers, much less summer associates who had yet to get an offer!

[Jeff Lipshaw]

Wall Street Partnerships and Public Service, circa 1970

[posted by Bill Henderson]

I have been reading Paul Hoffman's 1973 classic, Lions in the Street: The Inside Story of the Great Wall Street Law Firms.  Before writing the book, Hoffman was a reporter covering the legal beat for the New York Post.  For someone reading the book in 2008, it is a fascinating contemporaneous account of Wall Street lawyers circa 1970.  With the distance of nearly 40 years, it also reveals what is timeless about lawyers' preoccupations.

Here is a passage that I will use to explore the meaning of partnership in my course materials for our new Legal Professions course (from Hoffman's Chapter 4, entitled "Some Partners are More Equal than Others"):

There's a story told about a lawyer at Chadbourne who never spoke at partners' meetings.  For years he sat silent while his colleagues debated and decided the future of the firm.  Then, at one meeting, the promotion of associates to partnership was being considered.  A name was put before the panel.

"I don't want him," one partner said.  "I just don't like him."

The long-silent partner ahem-ed for attention, and the others bent forward, wondering what words of wisdom he had to utter at so long last.

"I don't see what that has to do with it," he said.  "I don't like any of you."

There's nothing in the books--or partnership agreements--that says partners have to like each other.  Some [Wall Street] firms manage to exist ... with the members barely even speaking to each other.  But the partners have to find some sort of accommodation if the firm is to remain viable.

Most of the disputes come down to money (that may be a surprise to some, especially those who hold to ideas of the good ole days).  Hoffman provides loads of anecdotes on "pie-hacking sessions."

Another striking feature of Hoffman's book is how many Wall Street name partners spent time in government, or left Wall Street and started a DC firm after a prominent political appointment. These partners were the paradigmatic "lawyer-statesmen" of Anthony Kronman's The Lost Lawyer (1993).  But Hoffman's book, which reviews the lineage of virtually all the major Wall Street firms, implicitly makes the case that government service eventually produced a booming law practice.  In an era in which talking to the press could open the door to charges of unethical solicitation (norms changed radically after Bates and the subsequent rise of the legal press in the late 1970s), newspaper coverage of public service presumably had special value.  Not surprising, partners were willing to subsidize these activities.

Is it possible that the value of public service (as, essentially, a loss leader) became watered down by the courtroom and boardroom coverage of The American Lawyer, National Law Journal, and other publications?   Questions like these come to mind as I flip through the pages of Hoffman's lively book, which reads like a novel.  I highly recommend it.   

Young Lawyers: What Do You Want to Be When You Grow Up? (And Can You Repay the Loans?)

Posted by Jeff Lipshaw

I have, in the past, expressed some disdain toward the victimology advocated in some quarters over the plight of very highly paid young Big Law lawyers.  The only thing yet that has given me pause to reconsider the fervency of that belief is the troubling and puzzling issue why one would incur up to $100,000 in student loan debt without at least some shot at one of those pricey jobs that would provide the basis for repaying the loan.  Nevertheless, my sense is that the Golden (or at least Silver or Bronze) Handcuffs might well be as effective as the debt in tying one to an unsatisfying career in Big Law, but that's merely reflecting my own experience.  The bigger concern is what happens to people who don't get those kinds of jobs, but incur that kind of debt.

Notwithstanding the economic pressures from whatever source, I think we have to acknowledge, however, some personal accountability for what we want to be when we grow up.  On that score, the February 2008 edition of the ABA Journal, freshly delivered to the mailboxes here in Suite 250, has an interesting pair of juxtaposed articles.  One is an excerpt from Making Waves and Riding the Currents, the memoir of Charles Halpern (left), who left the relative security of Arnold & Porter in the 60s to found the Center for Law and Social Policy, and later became the first dean of the CUNY School of Law.  The excerpt describes his decision to leave Arnold & Porter and its lifestyle (although, notably, the question of being saddled with debt does not come up).  The other is a description of a week in the life of Stephen Susman (right), the founder partner of Houston's Susman, Godfrey, and a big-time Big Law lawyer (albeit an entrepreneurial one), replete with early morning personal training and dog walking in Central Park, breakfasts with George Soros, benefits, fancy lunches and dinners at posh NYC restaurants, conference calls, and prep sessions for pending hearings in which he will be up against David Boies.

Do these stories reflect the polar extremes of what we want to be when we grow up?  Is the idea of personal autonomy and accountability - that either career is achievable - a myth that collapses in the face of the present economic reality facing most of today's law students?

$1,000/hour? Nero has become managing partner and is fiddling away....

Posted by Nancy Rapoport

Jeff's post on this latest rate increase points out that some lawyers are worth $1,000/hour or more, but the group of lawyers that can justify that rate is a much smaller pool than the group of lawyers charging (or about to charge) that rate.  And that high rate is efficient only if the lawyer charging it is doing those tasks that use his or her specialized expertise.  The problem, of course, is that the rate doesn't distinguish between "review file" and "develop brand-new legal theory that saves the day."  And then there's the copycat issue, where lawyers who think that they're worth $1,000/hour want to increase their rates just to stay in the game.

I found Steve Susman's comment about his hourly rate most interesting: 

Plaintiffs['] trial lawyers often bill on a contingency-fee basis, earning a share of a settlement or verdict -- an amount that can dwarf top rates. "It represents an opportunity cost when I am working by the hour," says Mr. Susman, who last year raised his hourly fee to $1,100. He did it in part, he says, "to discourage anyone hiring me on that basis."

That reason I can understand, and I set my own consulting rate very high (but not $1,000/hour high!) for the same reason.  How many of the law firms increasing their rates to the new four-digit high spend much time calculating their "value added" part of the equation?  I'll bet that, instead, they're just trying to make ends meet, given the still-increasing overhead caused by high associate salaries, and of course there's always the ego problem (he charges $X, therefore I will, too).  Other folks (including here, here, and here) have been noticing the increasing disconnect between fees and value.  Something's going to give, and soon--and Nero's new rates are speeding it along.

$1,000-Per-Hour

Posted by Jeff Lipshaw

The Wall Street Journal leads the Marketplace section today with an article on the impending crossing of the $1,000 per hour rate for some of the top lawyers in some of the top New York City law firms, like antitrust guru (and former director of the FTC Bureau of Competition) Kevin Arquit (right) at Simpson Thatcher.

To me, it's just a number.  As a GC, I was far more interested in total budgets and value-propositions than the hourly rate.  So I could see ponying up an ungodly hourly rate for the certain few (like Kevin or his counterpart at Weil Gotshal, the handsome and debonair Steve Newborn) who could bring value to bear (Brackett Denniston III, the GC of General Electric allows as he has done the same).  I scratch my head more at paying a litigator that much for two reasons:  it piles up quickly, and I can only imagine a very few "bet the company" cases that would warrant fees at that level.  Indeed, one of our strategies within the company was to bid out important but not mission critical work to high quality lawyers at non-financial center firms.  As an example, we pushed much of our national products liability litigation to the Butler Snow firm in Jackson, Mississippi.

But the psychological impact of barriers like this - 1,000 internals on the Dow, the millionth customer, 75,000 discrete hits on SiteMeter - are interesting.

Majority Rules

A law firm partnership agreement was amended by majority vote in a manner that impacted on compensation to withdrawing partners. The New York Court of Appeals upheld an Appellate Division decision holding that the amendment was proper because "the agreement, by its terms, unamiguously permits amendments thereto by majority vote."

Former equity partners at Fish & Neave, an intellectual property firm that has since merged with Ropes & Gray, had sued both firms after the firm had changed its accounting system in a manner that affected the compensation due to departing partners. The change had been implemented to attract potential lateral partners or a merger opportunity. Two lawyers who left after the amendment had been passed sued claiming, among other things, that the amendment should be invalidated. The court held that the amendment was properly implemented by majority vote because the agreement clearly provided that all partnership questions be resolved in a such a manner. (Mike Frisch)

The "Do We Need to Know..." Trilogy: Part 3 - The Skeptical Client

When I was the general counsel of a large publicly-held company, we had a chief executive officer, my primary advisee (not my primary client, mind you, that was the corporate entity), who I think truly believed that the law and lawyers were put in the world for no reason other than to place barriers or hurdles between where he was and where he wanted to be.  No surface answer was ever sufficient to satisfy him.  "Why can't we buy back stock now?"  "Why can't we sell stock in our public traded subsidiary?" "Why can't we sue X or Y for this?"  "Because that's the law" or "because I said so" was never enough.  And despite the fact that he wasn't a lawyer, his natural smarts and suspicious take on the whole game made the cross-examination as intense as any grilling to which a Kingsfield-like law professor could ever subject a student.

Before I would talk to him about a matter, particularly one as to which I knew he would not like my answer, I asked myself the question "what do I need to know?" and the answer was often that I needed to peel the artichoke all the way down to the heart.

[Jeff Lipshaw]

In Memoriam: DLA Piper's Jeff Liss

I was tremendously saddened to learn just a few minutes ago of the passing of a great lawyer and good friend, Jeff Liss, one of the managing partners, and indeed one of the architects, of what is now known as DLA Piper.  I came to know him because Piper Marbury, one of the predecessors of DLA Piper, had done work for Great Lakes Chemical for a long time, and Jeff led a team in for one of our "dog and pony shows" as we pruned our outside counsel relationships down to a few.  We quickly became friends.

Jeff was a loyal alumnus of the University of Michigan Law School, and a fierce supporter of the Michigan football team.  We met to talk during the occasion halftime on the upper level concourse on the east side of the stadium.  He taught Remedies as an adjunct professor at Michigan and Georgetown, and introduced me to his friend Lincoln Caplan, who was the editor of Legal Affairs, the hybrid practice-academic journal loosely associated with the Yale Law School.  (Unfortunately, I was too theoretical for that journal, an ironic twist!)  I confided in him as I started to act on my own academic impulses.  Indeed, I have a piece in the DePaul Law Review that began as a conversation with Jeff about a presentation he wanted me to give at the firm's Marbury Institute, a speaker's series bridging practice and academics.  His son, Harry, and my son, Matt, are both currently students at Michigan, and Jeff was responsible for a special treat accorded Matt.  During the summer of 2004, while Matt was doing a summer program at Harvard, the Democratic National Convention was going on in Boston, and Jeff got him and a friend access to a special Goo Goo Dolls concert and a reception the law firm was hosting for the Democratic senators.

Here's what the firm had to say on its website:

In many ways, Jeff embodied the soul of our firm. Not only was he deeply dedicated to his clients as a leading environmental and business litigator, he was particularly passionate about building the quality and quantity of our pro bono work around the world. For many inside and outside the firm, it was Jeff's advice on a difficult issue, in the end, that mattered most. Outside of DLA Piper, Jeff had been a top student, a favorite clerk to one of the leading judges in the country, and a trusted advisor to various national political leaders. Most important, Jeff was a devoted husband and father.

DLA Piper is blessed to have known and worked with such a remarkable leader, colleague, mentor, and friend.

Jeff fought pancreatic cancer for over two years, and while that's an uphill battle, he seemed to be beating it.  I am just so sad to lose a friend, and for all of Jeff's family, friends, partners, and clients who knew him to be a kind, funny, wise, good, honorable, smart, tough, caring person and lawyer.

[JML]

More on Lawyer Happiness (or the Lack Thereof)

John Steele over at Legal Ethics Forum has touched off a very interesting dialogue on the subject of lawyer happiness and unhappiness, and the scholarship of it.  Both John's observations and the comments of other really first-rate thinkers (including John) on ethics are recommended.

John credits the book we have both reviewed as "cultural criticism in the mode of Roland Barthes."  I would also (and did) give it credit as one instance of anthropological or cultural narrative, but, in fact, the author and its publisher market the book as something more: "empirical" and as involving "painstaking analysis."  I suppose in the very broadest sense that might be true, but I leave that to the reader.  I have said about as much as I want about it.

John also referred to an article by Patrick Schiltz published in the Vanderbilt Law Review back in 1999.  My reaction to the Schiltz article was about like Brad Wendel's in the comments over at LEF:  there was certainly more beef and balance to it.  And it stressed personal choice and accountability as a normative recommendation.  Plus, Schiltz had the benefit of a relatively extended stay in a big firm.  But Schiltz had his own bouts with hyperbole - I thought the description of the cocktail party was pretty funny, but it IS hyperbole, and having hors d'oeuvres at a partner's house isn't unethical, which is what it seemed to suggest it helped lead to.  (A couple shrimp wrapped in bacon, and the next thing you know you are a heroin addict!)  I used to go to a party like that just about every Christmas hosted by the head of the litigation group.  He and his wife are still married after forty years or so.  And while he was a fearsome litigator, he was one of the most honorable people I ever met.  (He did like his Dewar's, on the rocks and with a twist.)  Only to say, as law professor-anthropologist John Conley does, you have to be careful what you infer from this kind of data. 

And Schiltz's intro on depression and lawyers is highly suspect.  As my wife, an MPH, advised this morning, there's no way you can tell (as Schiltz admits, but only fleetingly) whether depression-inclined people self-select to be lawyers, or being a lawyer causes or exacerbates depression.  Given depression's biochemical etiology, I'd be inclined to think the seeds are there to begin with, but we may never know.

Finally, Bill Henderson (Indiana) of "Young Associates in Trouble" and Empirical Legal Studies passed on the following references.  The Harvard Law Bulletin has an article in the fall 2006 issue on the "After the JD" study being undertaken by David Wilkins (Harvard, right) and the HLS Center on Lawyers and the Professional Services Industry.  This is a ten year longitudinal study tracking nearly 4,000 new lawyers.  Says the Bulletin:  "Job satisfaction is one aspect of the responses that Wilkins finds most interesting.  According to the study, and contrary to what most believe, there is 'no evidence' of 'any pervasive unhappiness in the profession,' he says - at least not among those who began practicing in 2000."  Bill also suggested John P. Heinz, Kathleen E. Hull, and Ava H. Harter, "Lawyers and their Discontents:  Findings from a Survey of the Chicago Bar," 74 Indiana Law Journal 735 (1999), which found that lawyers were no unhappier than any other profession or job.

Again, all of this to say that we need to be very careful, particularly as law professors, in describing the world as we think it is, and in figuring out how our view of the "ought" affects it, if that is at all possible.

[Jeff Lipshaw]

Conley on Racial Equity in Private Firms

Posted by Jeff Lipshaw

One of the wonderfully rewarding aspects about jumping into academia after so long in the practice is to realize that part of the job description of professional teacher is (or should be) to be a professional learner.  (That we are professional learners even in business was part of my management philosophy, so perhaps that says something, but I don't know quite what.)

That's an introduction to my recommendation of a tremendously interesting article, methodologically and substantively, by John Conley (North Carolina, left), who I featured in a post yesterday.  The article is "Tales of Diversity:  What Lawyers Say About Racial Equity in Private Firms," 31 Law & Social Inquiry 831 (2006).  Professor Conley is an anthropologist and law professor, so the first part of the paper is an explanation of the scholarly discipline of ethnographic narrative - what you can learn and just how much you can generalize from what people say about their culture - in this case, lawyers about their jobs and their firms.  The second part is a report on what lawyers in different kinds of firms actually say about racial diversity.  The abstract follows below the fold, but as Larry Solum would say: download it while it's hot!

Here is the abstract:

This paper reports on what a narrative study of the legal profession has revealed about diversity in private law firms. Since 1995 I have taught a course about the legal profession that revolves around interviews with lawyers representing the breadth of the legal profession. Over nine iterations, I have completed over 100 such interviews. They have yielded narratives on such topics as how various kinds of practice groups work, how legal careers evolve, how lawyers' professional and personal lives interact, how lawyers feel about their profession, and what they believe are their most difficult moral and ethical challenges. The topic of diversity in various practice settings has also figured prominently in most of the interviews. All of the lawyers interviewed have expressed enthusiasm for diversity as a value to be pursued. However, almost without exception, private-firm lawyers have admitted that their respective organizations have made unsatisfactory progress. When asked to analyze their firm's performance, most provide explanations that do not augur well for the diversification of the private bar in the near future. Their narratives implicate as causal factors the history of individual firms, the nature of intimate business associations, the profession's dominant hiring and promotion models, and, in most cases, the absence of external pressures to diversify

Screed or Scholarship?

Posted by Jeff Lipshaw

Several weeks ago, I posted some thoughts (not positive!) about The Destruction of Young Lawyers, by Douglas Litowitz, which had gotten some play on the blogs of several well-regarded professors, including Legal Ethics Forum, Leiter's Law School Reports and Balkinization.  I have since written, and now posted on SSRN, a more fulsome review of the book, summarized by this abstract:

This is a review of The Destruction of Young Lawyers: Beyond One L by Douglas Litowitz (Akron: University of Akron Press, 2006).

While the book may be a credible (if tiresome) account of Mr. Litowitz's own unhappiness as a law student and large firm new associate, and evidence of the fact there are unhappy lawyers in the world, it overpromotes itself on two counts. Although it is written by a law professor and published by a university press, and makes broad and universal claims about evils in the legal profession, it is largely a slapdash pastiche of hyperbole and anecdote. Nor is it a balanced view of the profession. Rather, it is one man's attempt to transpose his own journey through hopelessness and despair into a universal truth under the patina of scholarship.

       What you cannot tell from the abstract is that the review juxtaposes good work by Bill Henderson (Indiana-Bloomington, left) and David Zaring (Washington & Lee, above right), as well as an interesting piece by John Conley (North Carolina, below right) to which they cite briefly: "How Bad Is It Out There?: Teaching and Learning about the State of the Legal Profession in North Carolina," 82 N.C. L. Rev. 1943 (2004).

My piece will appear in Hart Publishing's Legal Ethics, of which Brad Wendel (Cornell) is the book review editor.

UPDATE:  One of the book's themes is how the unholy cabal of elite law schools and big law firms force law students to keep taking those $160,000 starting salaries to pay off the six-figure student debt.  Somebody forgot to tell NYU.  Today from Peter Lattman at the Wall Street Journal's Law Blog is a summary of Crain's New York's "The  Business of  Law  Report" which includes:

A Q&A with Joshua Perry, a recent NYU Law grad who took a job as a public defender in New Orleans. When asked about his law-school debt, he explained that at $40,000 per year there’s no way to repay a six-figure debt bill, but NYU has a generous loan repayment program. As long as Perry stays in the public interest for five years, he says that NYU picks up his loan debt and making his payments as long as his salary stays below a certain cap.

Character and Skiing: An Analogy?

An old professional friend (the lawyer for another side in a deal many years ago) switched firms because his broke up.  He commented:  "That type of event does not seem to bring out the best in people."

Character is like skiing.  It's easy to hold your form when the hill is gentle and smooth; it's much tougher when it's steep, icy, and full of moguls.

[Jeff Lipshaw]

Follow Up to Hricik Post on Facial Prosecutorial Misconduct

Posted by Alan Childress

Over on Legal Ethics Forum, David Hricik (Mercer) had previously posted, in "Naked Prosecutors, Oh My!," about a Ohio prosecutor arrested for wandering around his building without legal briefs.  Apparently a prosecutor in Seattle (or two) read David's post and determined to one-up the merely-naked Ohio prosecutor.  A post on CrimProf Blog reports (from the Seattle Times) that he (but not she) was arrested after patrons complained they were having sex in a bathroom stall at Qwest Field during a Seahawks game [editor's commentary: eww].  He is a senior deputy prosecutor, not unlike the title held by "Jack McCoy" (Sam Waterston) in Law & Order. Because NBC producer Dick Wolf always prides himself on taking the show's plots straight from recent headlines -- and fearful that the actors including Fred Dalton Thompson are method-trained Stanislavskians who always do their research before playing a role -- we at LPB are determined to simply 'hold it' at any future sporting event to avoid hearing that donk-donk musical cue coming out of the stall next door.

Boomer Lawyers Retiring ... on What?

Posted by Jeff Lipshaw

Hum the boomer anthem We Didn't Start the Fire as you contemplate this.

Law firms with the foresight to force partners to save for retirement by instituting defined benefit pension plans thirty or forty years ago are now feeling the same pinch as companies generally in trying to keep pension assets growing to meet obligations that are growing even faster.  The problem with pure defined contribution plans (i.e. 401(k)s and the like) is that saving depends on the employee - matching plans can create incentives (bring the horse to water), but they can't make young or middling lawyers save (one presumes they drink!). 

A couple years ago, a federal district court in the Southern District of Illinois shocked the pension world with an opinion noteworthy for its complete ignorance of the concept of time value of money and the allocation of risk and return in ruling that what has become known as a "cash balance" pension plan violated ERISA.  The essence of the cash balance plan is to promise a rate of growth on the contributions, not a particular level of benefit.  In an eminently sensible opinion, Judge Easterbrook concluded that the time value of money did not constitute age discrimination under ERISA (by providing a different level of benefit the longer an employee was in the plan), and reversed the decision (See Cooper v IBM Personal Pension Plan.) While this restores balance to the pension universe (get it?), the political and demographic impetus behind the case continues to raise its head. 

What makes the plan a defined benefit plan is the fixed obligation to pay, say, five percent a year growth.  The company still takes the risk that its investments will not accrue even at that rate, but it is more manageable than chasing the equity markets.  But the impact is that younger workers will not have as rich a pension payout as their older boomer siblings and cousins.

That generational impact is now being felt in law firms, particularly those with defined benefit plans, where older partners are retiring nicely, thank you, very young partners have no expectation of similar benefits and quail at the thought of supporting all the younger boomers, and the younger boomers are now in the squeeze, facing a shorter period before the golden years to accrue value, and not getting the old defined benefits.

UPDATE:  Paul Secunda over at Workplace Prof Blog (who actually knows whereof he speaks!) has intelligent commentary on this subject.