by Brian Mahany
[Ed. Note: We will soon be launching a new blog, Best Legal Practices Blog. While our web team set up the new site, we welcome stories and posts. If you have something to share, send it along. My email address is at the bottom of this post.]
Big lawyers and big law firms are in trouble. As I read the news wires this morning, two stories struck me. In the first, the U.S. Bureau of Labor Statistics said that the legal services sector shed an additional 2,400 jobs in January. That continues a trend that has been going on for several years. Thompson Reuters reports that the larger law firms plan on thinning their partnership ranks by another 15% this year meaning thousands more lawyers will be laid off.
Does this mean that the price of legal services is coming down? Unfortunately, no. While revenues are down, big law firms have mostly kept their rates flat. A few have even raised them!
A feature story by Thompson Reuters today detailed the financial woes of a well known Florida plaintiff’s attorney, Willie Gary. I respect Gary and some of the wins he has racked up in recent years. $250 million against Disney; half a billion against a funeral home chain. With all those million dollar verdicts, Willie should be swimming in cash. He is not. Apparently he is swimming in debt.
Gary has the same problem that many “BigLaw” firms have. They spend too much money. Gary is being sued for defaulting on a loan for his Boeing 737 aircraft, the “Wings of Justice.” According to published reports, Willie Gary had the plane outfitted with a bedroom and an 18 karat gold sink.
Someone pays for those perks. For large firm lawyers, it is always the clients.
The BigLaw model is failing yet those at the helm of America’s once mighty and great law firms just don’t see it coming. It’s like rearranging the deck chairs on the Titanic. The ship is sinking but the hearty band of lawyers will keep singing and drinking until the ship quietly passes beneath the waves.
What does the new model look like? It’s still emerging so it’s difficult to see what envision what it will look like 10 years from now. Our corporate clients want to see more alternative fees – cases taken on a hybrid basis where the firm shares the risk.
There is also an increased use of specialty or boutique firms like ours that don’t try to do all things for all clients. We are quite happy with our model – fraud and tax. That allows to us to do just two things but do them really, really well.
If you want more information about us or what we can do, visit our Mahany & Ertl or better yet, give us a call. Managing partner Brian Mahany can be reached directly at firstname.lastname@example.org or by telephone at (414) 704-6731 (direct).
Mahany & Ertl – America’s Tax and Fraud Lawyers. Offices in Milwaukee, Wisconsin; Detroit, Michigan; Portland, Maine; Minneapolis, Minnesota and San Francisco, California.