Welcome to the fourth quarter issue of The Column. Winter is right around the corner. During this presidential election year, you may have noticed that CHANGE is a word you hear often.

In keeping with that trend, we have assembled three articles about change in the legal staffing world and the legal market in general. First, is an article on the creation and growth of law firm groups which have been assembled to handle matters emanating from the financial downturn. Second, Tara Boosey, executive director of our Nashville office, and Jennifer Blaga, executive director of our Cleveland office, weigh in on the growth of legal professional associations nationwide. This article highlights the steps Special Counsel is taking to broaden and strengthen its relationships with these associations and ways to further assist them with accomplishing their goals.

The final article is from a veteran of 25 years in the legal staffing industry, Steve Mims. Steve is the executive director of our Houston office and our Texas attorney search director contingent. A Texas attorney himself, Steve joined us just over a year ago as a part of our acquisition of Prescott Legal Search, the premier legal staffing firm in Texas. Steve is in a unique position, having seen many changes including the rise of the contract attorney as well as the rise of the digital age in law and legal staffing. His article comments on changes in law and staffing which have taken place over the last two and a half decades.

Have a good fall.

David J. Maldonado, Esq., Editor
Senior Vice President, Special Counsel

What more immediate symbol of change than the veritable explosion of groups being established to address the financial state of the markets and the corresponding fallout? As has become apparent, painfully so on many fronts, the state of the economy has caused financial, market and multiple other tremors. And, naturally, the ripples have made their way into the legal arena. While the repercussions of the financial waves have understandably had a significant general impact on the legal scene, they have caused the quickest and most direct effect on the very nature of practice within law firms.

Please say hello to the newest of the practice area teams, the Credit Crisis Group. To distinguish one law firm group from the other, welcome also the groups whose names are formed from some combination of the following terms: financial, recovery, troubled asset, task force, advisory, subprime, financial services, response, etc.

To the credit of the many law firms that have taken the initiative to ensure that they are prepared to protect and represent their clients as fully as possible, between September 25 and October 14, 2008, press releases announced that 13 such teams or groups had been assembled in firms across the nation and internationally. The largest law firms are well represented among these.

Crisis blogs have also been introduced. These blogs focus on the changing legal and business issues related to the markets. The new financial task force-type teams primarily consist of lawyers currently with their respective firms. Many members of these groups are drawn from the firms’ bankruptcy, corporate, restructuring, corporate and government regulation sections.

But, of course, the greatest numbers of practitioners are drawn from a firm’s litigation section. As this article is being written, Forbes magazine has predicted that the current state of the market will lead to the “next great mega-litigation.” Forbes also indicates that the pace of securities class-action litigation has accelerated due to the financial crisis and that the numbers of such cases are expected to grow with increased bank failures.

Some of these new groups consist of veterans of the litigation and related work that grew out of the savings and loan debacle of the 1980s. Consequently, there are attorneys and other legal professionals who already have at least some of the experience required to successfully represent clients going forward. Others who are likely to have relevant experience come from the following practice areas:

• Complex litigation
• Government and corporate affairs
• Financial regulation
• Banking
• Hedge fund
• Broker-dealer
• Finance
• White-collar crime
• Securities

There will be firms and corporate legal departments without many or any attorneys or other legal professionals with this type of expertise. As 2008 closes and 2009 begins, there will be a premium on individuals with fluency in market crisis issues. Special Counsel can assist in your endeavors to identify personnel with backgrounds in any of these areas. In fact, it has several staff members who themselves have experience from the S&L litigation days, who can bring that expertise to bear in the search for appropriate staff on your behalf.

David Maldonado, Esq. is Senior Vice President of Special Counsel and Editor of The Column.

The growth in size, number and breadth of bar and other legal professional associations in the past two decades has been dramatic. Bar and other legal personnel associations once numbered only a handful of large state associations and another handful of national associations. Since then, the number of associations has grown quite significantly and the numbers and types of constituents have become wide-ranging and varied.

In response to this growth, in January of this year, Special Counsel, long a supporter of legal professional associations, began an initiative to explore and define the best relationship between various national affinity groups and Special Counsel. Chaired by senior vice president David Maldonado, liaisons from Special Counsel offices were selected by senior leadership to work with a prominent group of affinity organizations. The goal of these national liaisons is to align with these professional associations to determine how best to develop these relationships and how best to help each of the organizations meet their national, regional, and local goals. Of mutual benefit is input and dialogue on how these entities and their vendors can work together.

It is the charge of each liaison to spearhead these efforts, and to develop recommendations on what the optimal relationship with each group will be. The list of organizations and their national liaisons (and the city in which the liaison is located) is in the chart below.

There has already been excellent progress with several of these groups. Exploratory meetings have been held with the 2007/08 President of the National Conference of Women’s Bar Associations (NCWBA); the President and President-elect of the Hispanic National Bar Association (HNBA); and the President of the National Asian Pacific American Bar Association (NAPABA). These discussions focused on ways in which Special Counsel could assist the groups in meeting their goals and to get a deeper understanding of their missions.

As an example of efforts that are being made, Special Counsel (through liaison Jennifer Blaga of our Cleveland office), has agreed to reach out to all bar associations in Special Counsel markets that are not NCWBA members, to encourage membership in NCWBA and to encourage them to evaluate financial sponsorship participation. Also, Jen Blaga and Carine Hodges from our New York office attended the NCWBA Annual Summit and were able to meet and seek input from organization members from regional and local level associations. These interactions assist us in knowing how we can be of service to these and similar organizations and how participation can vary between them and Special Counsel. We will continue to offer our support nationally by reaching out to potential members, encouraging membership, and providing market information, relevant articles and speakers.

Marya Brancio, Executive Director of our Denver office, provides us with another notable example. Marya recently joined forces with a few of her local paralegal managers to begin the process of creating a new IPMA chapter in Denver. The idea began to brew when a paralegal manager, who has a working relationship with Marya, and who is one of only three active individual IPMA members from the Denver area, attended the IPMA national conference in Phoenix this past year. He attended a
Special Counsel dinner at this conference. Through his discussions with Marya and his interaction with IPMA board members at the conference, he was prompted to create a chapter in the Denver area. He thereafter asked Marya to be a participant in his efforts at building the new chapter.

We are happy to report that after an initial meeting in mid-July, the Denver chapter of IPMA was formed and the paralegal manager was installed as its founding President. The group is currently preparing for a dinner/membership drive event, tentatively set for November, to spread the word to local paralegal managers about the chapter. Special Counsel will be assisting in making calls to encourage attendance at the dinner and to assist in membership signups.

If you have ideas to share with us, please feel free to contact your local Special Counsel representative. Affinity partnerships are win-win scenarios for all.

Tara Boosey is the Executive Director of Special Counsel’s Nashville office and Jen Blaga, Esq. is the Executive Director in Cleveland.

Special Counsel-Approved Liaisons

Organization	Special Counsel Liaisons
American Bar Association	Alexis Reed (Chicago)
Association of Corporate Counsel	Marci Dunnagan (Boston) Steve Mims (Houston)
Association of Legal Administrators	Tara Boosey (Nashville)
Hispanic National Bar Association	David Maldonado (Dallas)
International Paralegal Management Association	Laura Fulton (DC)
Minority Corporate Counsel Association	Keisha Hudson (Atlanta)
National Asian Pacific American Bar Association	Beth Palmer (San Francisco)
National Bar Association	Carine Hodges (New York)
National Conference of Women’s Bar Associations	Jen Blaga (Cleveland)

As a “baby boomer” attorney entering the legal staffing business almost 25 years ago, after a decade of both private and corporate practice, I have been a participant in some dramatic changes affecting both the practice of law and the staffing industry.

Changes in the Law Firm Business Model
Although the traditional professional service delivery concept of “buy wholesale and sell retail” (leveraging non-equity professionals) continues in the law firm setting, the fortunes of all stakeholders have changed as law firms changed profit center accountability from the firm as a whole, to the practice section, and now to the individual attorney. Instead of a lifelong commitment to one firm, attorneys, including partners with a portable clientele, now consider lateral movement as a means of advancing their careers. This is particularly common within the associate ranks of larger law firms where the average annual attrition rate is 20% or more, with the pressure to develop clients being the primary complaint. Some firms are now questioning whether the traditional clerkship path to associate employment and development is either profitable or efficient, suggesting that lateral employment of associates trained at another firm’s expense might be a better path to follow.

The private practice of law is also big business. “Big” law firms of 100 attorneys (when I left the practice) have given way to global firms of thousands of attorneys with one such firm recently passing the $2 billion revenue threshold. As a result, law firms are more professionally managed by a senior, non-attorney professional with a keen eye toward profitability and growth. Formerly proprietary information such as profits per partner, revenue per lawyer, realization rates and the like are now publicly touted as firms compete for talent. Such competition has also driven associate salaries and their billing rates to levels objectionable to rate-sensitive clients. Increasing pressure by large clients for alternative billing arrangements, bidding for work (RFPs) and budgets for transactional work and litigation threaten the hourly billing structure upon which most law firms are built.

The result of all these changes is a more fluid market for legal talent where standards of measuring a lawyer’s added value are far more objective than practice skills alone. Time will tell whether such changes will be best for both the profession and clients.

The Rise of Corporate Counsel
Once undeservedly chided by some outside counsel as unnecessary gatekeepers to their clients’ senior management, today’s in-house counsel are vital partners to outside counsel in the client relationship. They offer an interdisciplinary “business lawyering” perspective vital to corporate risk management.

The traditional corporate employers of legal talent (large energy, utility, insurance, and transportation companies, etc.), offered a recently graduated attorney the opportunity of a long career, including pensions and other benefits not offered in law firms, and a more predictable work schedule. Most corporations now prefer that the attorneys they hire have: prior private practice experience; a demonstrated record as a team player with a strong work ethic; well-developed interpersonal skills; and a proactive service-oriented attitude. Although compensation for corporate counsel often lags behind their peers in private practice, the net worth building opportunities, relief from the pressure of billing hours and developing clients and a more predictable work/life balance are acceptable trade-offs for many seeking to move in-house. A significant portion of legal work is being “insourced” as billable rates for outside counsel exceed the cost of providing such work in-house.

Corporate life may also offer some attorneys the opportunity to “move to the business side” in a non-legal role where prior legal experience is valuable, especially for those who have developed leadership and management skill along the way. Corporate counsel are also leading the effort to partner with outside counsel to produce the best result for the lowest reasonable cost. Novel cost management techniques are now in place or being developed which require outside counsel to develop alternative billing strategies in response. There will always be the “bet the company” matter requiring the best outside counsel money can buy but you can’t build a firm within such a rare atmosphere. Or can you?

Diversity Initiatives
Fortunately, diversity initiatives have moved from being “the right thing to do” to best practice (sometimes encouraged by outside forces) to just being good business. The international and multi-cultural clients and corporate stakeholders of today have decision-making roles addressing the demands of a global marketplace and impacting the decision to engage outside counsel.

I graduated law school with only a handful of women and now they often comprise the slim majorities of law school students. The number of ethnic minorities in my graduating class was even smaller and now there are more than a hundred minority bar associations in existence.

The legal staffing industry is uniquely positioned to be a strategic partner in driving our clients’ diversity initiatives. More than offering a “diverse pool of candidates,” we are an advocate for our clients in the market for diverse legal talent.

Development and Acceptance of the Contingent Legal Workforce
When I started practicing, a “contract lawyer” meant a lawyer specializing in the negotiation and drafting of commercial contracts. Incrementally, the “part time professional” concept caught on, not only as a way to respond to the hills and valleys of the workload, but also as a flexible employment alternative arrangement to retain a valuable attorney or legal assistant, while remaining employees by definition.

In time, the concept of a “freelance” attorney as an independent contractor gained the acceptance of the ABA and state bar associations. This alternative to direct hire placement is being offered by our industry on a massive scale. From the “knowledge worker” contractor performing a specialty practice – often for extended periods of time – to teams of document review professionals addressing the electronic discovery demands in today’s litigation, this contingent arrangement also offers some professionals the flexibility and variety missing in their history of permanent employment.

Our clients for this service are both law firms and, increasingly, corporations interested in preferred provider relationships on either a local or national scale. In response to such demand, Special Counsel now places more contract/temporary attorneys and support personnel than any other staffing or consulting company in the United States.

Steve Mims, J.D. is the Executive Director of Special Counsel’s Prescott Legal Houston office.