Legal Practice Advice

John Balestriere, writing in Above the Law, argues that young attorneys should not feel bound to follow the standard advice to start one’s career at a large firm to get “training.” As someone who spent 12 years at large firms and the last (almost) seven running my own small one, I’m in a position to weigh in on this topic. Although in my current position, I often expound on the benefits of small law firms, both for clients looking at what type of firm to engage and for experienced attorneys looking for a better way to practice law, I would still advise young attorneys looking to end up in the private sector to spend some time in a large firm.

First, an important caveat. Balestriere is a litigator, and my understanding (not based on experience) is that in that area, small firms and governmental agencies kind of throw young attorneys into handling trial work pretty much right away, as opposed to the large firm experience of having junior associates handle more behind-the-scenes work. I can’t speak to that; my advice in this post applies to those thinking of becoming a transactional attorney.

Most of my early formative years were spent at Willkie Farr & Gallagher, a well-regarded “white shoe” firm in New York. Although I can’t say that all of my time there was used productively (I recall with non-fondness being asked by a quirky corporate partner to not leave my apartment on a Saturday and to wait for a call, which never came), I learned a huge amount, making me the lawyer I am today. My experience at Willkie, which I think is true of most big firms, had the following attributes that, I think, make the large firm experience worthwhile for junior attorneys:

• Plenty of potential mentors – I took assignments at Willkie from dozens of partners and senior associates, allowing me to gain a variety of experiences. If you’re working at a small firm, your boss may be a good mentor, but you’re not getting the benefit of seeing how many different lawyers do their job.
• High standards – I certainly don’t want to denigrate the many talented attorneys who work at small firms and for the government, and there are some real duds at big firms, but I was impressed with the intelligence and work ethic of the great majority of those I encountered at Willkie. They helped create expectations for my work that I still seek to meet.
• Network building – By working with a lot of attorneys at a large firm (or, as in my case, at a few big firms over several years), you will encounter and hopefully impress people who may be, later in your career, potential referral sources for business or otherwise in a position to help you. Two of my most important current clients are (1) a public company whose CEO was once my boss when I was an associate, and (2) a promising startup whose founder was an associate with me at Willkie.

Gary J. Ross, like me a former BigLaw corporate and securities attorney who launched his own practice, writes in Above the Law about different types of client pitches, and which are the most effective. After detailing some lame and/or insufficient pitches, such as having gone to the same school as the potential client, he identifies the most effective pitch as being able to convince the potential client that you’ve successfully handled matters like the proposed one many times.

While I agree all of Ross’s points, there are two other elements to my pitch that I usually make:

Personal Service – Many of my clients are referred from colleagues of mine, and the client doesn’t comparison shop with other firms before hiring me, but in situations where I find myself in a competition with another firm, that firm is often a mid-sized or large firm, rather than one with my profile. In that scenario, the appropriate strategy is to play up the differences between my way of doing business versus the large firm way. Accordingly, I emphasize the personal service that I provide. In a big firm (and I speak from much experience there), the pitch meeting will often be led by the senior partner, but after the deal starts, you find yourself dealing mostly with someone more junior. In contrast, I point out to the potential client that I am the sole point of contact, though I have experienced attorneys doing behind-the-scenes work to help me keep up with my workload and be able to be responsive to the requests of multiple clients.

Cost – I’ve received advice from time to time that small law firms shouldn’t emphasize price too much, because it seems to devalue the service being offered. However, legal services are really expensive, regardless of who’s providing them. It’s perfectly valid and appropriate for clients to be focused on these costs and, accordingly, for the attorney to seek to appeal to potential clients on these grounds. Therefore, I’m not at all reticent about discussing my fees early on in my interactions with potential clients, pointing out that my colleagues and I are the same people that had successful careers in prominent firms, but whose services are now available to you at a significant discount to the going rates. I further point out that this is made possible by my firm’s extremely low overhead, with attorneys working from remote locations. In other words, when you hire me, you’re not paying indirectly for expensive artwork on office walls and summer associate trips to Yankee games.

I don’t win all pitches with these arguments – the biggest headwind that I face is that hiring a big firm is a safe choice that won’t likely be second-guessed within an organization – but it’s a pretty compelling story (if I do say so myself) and works plenty of the time.

It has long been a common career path for corporate and securities attorneys to move to in-house legal positions after some training at a large firm. Many of those who do so eventually make another transition within their corporate employer: from attorney to non-attorney, assuming some sort of business role within the company. These ex-lawyers often justify the move by saying that the business work is more central to what the corporation does and more interesting than legal work. I’ve always been skeptical of these claims, however, hopefully not just because I’m trying to justify to myself my decision to remain an attorney.

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More often than not, transactions that I’m involved in end up closing later than the date that the client initially targeted at the beginning of the process. Many clients that do a lot of deals are understanding about this and mentally build in extra time, just like homeowners don’t expect renovations to happen precisely when contemplated. However, many of those who are less experienced at deal-making can be disappointed and express displeasure to their attorney.

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When I was a young, large-firm attorney, the general consensus among my colleagues was that the most interesting corporate law work involved deals – big dollar M&A, public securities offerings, etc. – and that routine transactional work – supply agreements, non-disclosure agreements, etc. – was dull and undesirable. (I realize that my non-attorney readers will be surprised to learn that some corporate law work is even arguably non-dull.) The only reason to devote one’s career to the routine work (many would say) is that it tends to be less stressful and more conducive to seeing one’s family from time to time than is the case with big deal work.

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I had lunch recently with two law school classmates, each of whom works in-house at different large companies, each overseeing a team that negotiates routine contracts.  Both of them agreed that there is a recent trend among large companies with in-house legal departments to deemphasize the resources devoted to attorney review of routine contracts, though at the same time there is a greater emphasis on hiring regulatory attorneys.  With fewer attorneys available to review contracts, there is greater reliance on non-attorney negotiators.  The calculation is that the risk involved in these contracts is more theoretical than practical, so it is not worth the cost and process delays that result from involving attorneys. …

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The main functions of a transactional attorney working on a deal are fairly obvious: to draft (or review) agreements that accurately reflect the deal struck between the parties, to advise the client about whether the actions contemplated by the agreement pose any legal or business risks, etc. Another less obvious but still important role that the attorney can play is to communicate the client’s positions to the other side’s attorney, rather than having the client be forced to communicate those positions directly to the other side’s principal.  It can be awkward for the principals to speak directly on certain matters, and the attorneys play a useful filtering role. …

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The Wall Street Journal recently focused on the decreasing reliance on bank debt by large law firms to finance their operations, with capital contributions by partners being used in its place.  The rationale cited by those quoted in the piece relates to the perceived risk of debt, i.e., the desire for the partners to “sleep at night.”  I would submit, however, that risk is created by the business decisions made by the firms, and not the means by which they finance their operations. …

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