Legally Speaking - Legal Recruiter Blog

When you think of outsourcing you probably think of Blue collar jobs requiring little to no skill or technical support and customer service representatives who are as obsequious as they are incompetent spitting out canned dialogue with a heavy accent.  “I understand that you are upset because the defective battery we shipped with your laptop burned down your house Mr. Smith…”

No more.

Legal process outsourcing (LPO) companies are offering the services of lawyers abroad to handle the labor intensive parts of U.S. legal matters like document review in large scale litigation. As with other industries, India is the favored destination because, in addition to low wages, English is widely spoken.

Ethics Opinion 08-451, dated Aug. 5 but announced by the ABA Tuesday, states that sending legal work overseas is ethically permissible as long as the lawyer doing the outsourcing takes steps to ensure the protection of client confidences and preservation of attorney-client privilege.

The first casualties have been, and will continue to be, contract lawyers brought in to help with document intensive litigation, but, as Elie Mystal states in Above the Law:

how long before the work of junior associates can be cost effectively shipped overseas? It’s not like firms want to go to $190K for incoming associates.

People already in the pipeline should be fine. But change is coming to our profession. This ABA decision isn’t the tip of an iceberg, it is the receding sea that anticipates a tsunami.

Many contract lawyers have long held that the ABA represents the interests of wealthy partners at large law firms to the detriment of everyone else.  This recent opinion only serves to reinforce that view.

Would you spend thirty months in jail for $250 million?

In Monday’s posting, Why Do Lawyers Lie?, we looked at an article in the New Jersey Law Journal by Arthur D. Burger examining the psychological reasons why some lawyers lie.  Burger consulted a psychiatrist who put it down to an unhealthy mix of narcissism and rationalization.

But sometimes it’s just for the money.

Such is the case with Melvyn Weiss, co-founding partner of Milberg, the shareholder class action law firm once called Milberg Weiss.

Today Weiss will begin serving a thirty month sentence after pleading guilty to a federal racketeering conspiracy charge.  Weiss and six of his partners collected $251 million in attorney fees by paying $11 million in illegal kickbacks to lead plaintiffs as part of a criminal enterprise going back 25 years.

Click here for the government’s statement; here for the plea agreement.

Weiss’ punishment?  In addition to the thirty months in jail Weiss forfeited $9.75 million and paid a $250,000 fine.  You will notice I used the past tense here.  Weiss has paid the $10 million in full.  My bet is that it hurt him financially about as much as a speeding ticket hits regular folks.

OK, so it’s not really legal recruiting news, but as politics will be an inescapable part of our lives for the next few months I thought this would be of interest.

Mashable, the social networking news site, reports on 20 Tools to Follow the Democratic and Republican National Conventions.

In an article in the New Jersey Law Journal Arthur D. Burger Muses over why lawyers lie.  Reviewing a couple of instances where opposing counsel flat out lied in court in the face of documentary evidence he wondered

“What are these lawyers thinking?” Even from a Machiavellian standpoint, how could they expect to gain anything from such easily rebuttable distortions?

Burger sought the advice of a professional

So as a lawyer, I went to someone who I thought could explain this phenomenon. That’s right — a psychiatrist.

Not surprisingly the psychiatrist noted that lawyers and litigators in particular, “have generous helpings of narcissism.”  Really?

They will therefore use the psychological defenses of “rationalization” and “denial” to enable themselves to intentionally mislead — and even lie — if they believe that is the only way to win….they see themselves as justified , because they were acting for a “higher purpose.”  …the power of rationalization can be enormous. It can even be seen in such horribly extreme examples as when the killing of innocent civilians by terrorists is seen as “heroic.”

Seems like the same arguments can be made about politicians.  Something to keep in mind this election season.

Read the full article here for free, or subscribe to the New Jersey Law Journal.

L. A. Based Sheppard, Mullin, Richter & Hampton has launched a video game industry group.

Twenty attorneys, including eleven partners, are part of the group. 

Read More (free subscription to the National Law Journal website required)

It’s no longer raining cash on the legal idustry.

Dan DiPietro, client head of the Law Firm Group of the Citi Private Bank reaffirms some of the conclusions of the group’s Client Advisory, published jointly with Hildebrandt International this past January, updates others, and gives us a summary of their report for the first half of 2008.

From 2001 through the first half of 2007 law firms have reaped the benefits of a strong economy. Expenses grew, but profits outpaced them. Starting last year, however, expense growth, driven by continued hiring, started to outpace profits.

Despite a slowdown in demand firms continued to add lawyers, leading to a slowdown in productivity not seen since Q2 of 2001. ”The increase in total lawyer counts, coupled with the decline in demand, caused productivity, or average hours billed per lawyer, to drop by 5.5 percent in the first half of 2008.”

The advisory issued in January predicted profits of three to five percent this year, but profits are now predicted to remain flat or even fall by as much as ten percent across the industry and to fall five to fifteen percent at the AmLaw 100.

DiPietro suggests the silver lining of what promises to be a bad year for the industry is that firms will have to say goodbye to unproductive lawyers and get a better handle on expenses.

For recruiters and their rainmaker candidates the silver lining is that competition for top producing attorneys will increase.

Wayne Streibich

Attorney Wayne Streibich describes his relationship with recruiter Nancy Grimes of Grimes Legal, and the placement that led to his partnership at Dilworth Paxson, LLP.

It was indeed a great pleasure working with Nancy Grimes and GLI.  When Nancy approached me, I was not even contemplating making a move.  Nancy presented an opportunity which was intriguing, and we maintained consistent contact for quite some time in exploring the potential lateral move.  Nancy’s objective approach, discussing both the positives and negatives of such a transition, were invaluable in the process.  Moreover, her personal touch, and the thought and care that went into the relationship we developed, was the most impressive component of our collaboration.  At the end of the day, I felt that I was as much Nancy’s client as was the firm she was representing.  Not surprisingly, I am now a partner with that firm.  To this day, Nancy continues to maintain contact to discuss my integration process with the firm, and she continues to give truly valuable advice which comes from her years of experience in the industry.  I have heard it said, and have learned for myself, that a partnership with Nancy Grimes and GLI is one that encompasses the lifetime of your career.  Thanks Nancy!

Wayne Streibich serves as Chair, Middle Market/Emerging Company Group and Co-Chair, Banking and Financial Services Group at Dilworth Paxson, LLP.  For nearly 20 years, Mr. Streibich has focused his practice on general corporate matters, both domestic and international, with a special emphasis in representing middle market and emerging growth companies in a broad array of matters including the planning and formation process through the preparation of shareholder and operating agreements, employment agreements and noncompetition agreements.  Mr. Streibich’s practice includes the representation of lenders and borrowers in commercial loan transactions.   He also counsels financial institutions in issues relating to consumer loan disputes and real estate tax sales.

Additionally, Mr. Streibich represents both franchisors and franchisees in acquisition and sales transactions and in structuring franchise, license and distribution agreements.

As promised, we bring you an update on yesterday’s coverage of staff layoffs at Fried Frank. Here are a few additional details, from the National Law Journal (subscription):

Fried, Frank, Harris, Shriver & Jacobson is reducing administrative staff in New York and Washington. The reductions, which a firm spokeswoman said were less than 10% of the law firm’s 730 staffers firmwide, affect primarily floating secretaries, part-time assistants and paralegals and library personnel.

The layoffs, first reported on AboveTheLaw.com, resulted from the law firm’s review of its administrative resources and staffing requirements. The employees will receive severance packages based on years of service, the spokeswoman said.

Update / Correction: One source questions the claim that the layoffs affected “primarily” floaters and part-time assistants. According to this tipster, many of the laid off employees were full-time, senior secretaries — a number of them over 50, and some just a few months shy of getting their pensions. This source predicts that age discrimination lawsuits will be filed.

One tipster tells us the number of affected employees was in the range of 50 to 60, which would amount to under 10 percent of 730 staffers, and that severance amounted to one week of pay for every year of service. We also hear this:

Apparently, mail room, duplicating and facilities were told that their jobs were being outsourced by the end of the year. They could start looking for new jobs before getting laid off at the end of the year or apply with the outsourcing agencies (with no guarantees of a job or placement at Fried Frank).

New York staff were given “a few minutes to pack up and get out”; cars were provided to take people home (a nice touch — hopefully that will become “market”). One source claims that employees were laid off without regard to their seniority or their performance reviews, whether negative or positive.

What about attorneys? A spokesperson emphasized to us that Fried Frank “doesn’t do lawyer layoffs,” which was reiterated to associates by firm chair Valerie Ford Jacob at a meeting yesterday.

(Jacob also claimed that the firm has never laid off lawyers. But one source at FFHSJ begs to differ. This source claims that the firm laid off attorneys back in 1990, and then “suffered years of recruiting problems because of it,” which may explain its reluctance to go down that path today.)

More detail about the meeting, after the jump.

Working Mother Magazine’s 2008 list of the 50 best law firms for Women is out.  AmLaw 100 firms on the list include Skadden, Latham & Watkins,  Baker & McKenzie and Sidley Austin.

Read More…