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A VIEW FROM THE LEGAL PRESS BOX: An Interview with David Lat

Interview by JAMIE DIAFERIA

When David Lat founded the online legal tabloid Above the Law in 2006, the intention was for it to serve as a kind of virtual watercooler for the legal profession. But as those familiar with the online world of law know, the site has vastly exceeded that original expectation, both in its popularity and the influence it has in the profession. In some respects, it seems to have changed the way law firms operate vis-à-vis the media.

Lat is a former federal prosecutor who previously served as editor of Wonkette, the widely read politics blog, and he also founded Underneath Their Robes, the judicial news and gossip blog. He will be the keynote speaker at the ABA Law Firm Marketing Strategies Conference in Philadelphia on November 12. Conference Vice Chair and Law Practice Editorial Board member Jamie Diaferia asked Lat to share some of his unique insights.

Here are highlights of their conversation. (To read the complete interview, see this issue’s Online-Only Content section.)

Have you seen changes in legal industry coverage in the media in the past few years?

DL: There are a couple of trends. First, for some reason people have become more interested in the business of law firms, so there is a bit more attention being paid to this area even in the general media. Second, the coverage itself is becoming more hard-hitting. It’s not just puff pieces anymore, partly because people realize the truth is going to get out there one way or another with so many venues on the Web. So law firms are being more forthcoming about their bad news because now they know they can’t just sweep it under the rug.

When I first started Above the Law, it was actually very difficult to get firms to comment. They would just ignore us, perhaps hoping that we would eventually go away. But most firms nowadays are willing to cooperate and give us comment because they want to manage the message a little more. They want the opportunity to communicate their side of the story.

And we’re happy to work with firms that are interested in communicating their message. Of course, if a firm doesn’t work with us, it doesn’t mean we’re not going to write about it—we’ll just go about doing it with our own sources.

In considering the way firms have gone about announcing layoffs, do you feel like there’s a right way and a wrong way to do it, especially in terms of how it gets reflected in the media?

DL: It is in a firm’s interest to be honest because the firms that are honest about layoffs in some ways take less of a PR hit than the firms that are duplicitous about it. Those firms get attacked primarily not for the economic difficulty they may be suffering, but more for not being up front about it. A lot of firms are affected by the economy. The honest ones are saying, “Yes, we’re affected by the economy and unfortunately we’re in danger of going through personnel reductions,” while some of the more disingenuous ones basically try to spin it by saying, ‘Well, we are getting rid of a lot of underperforming people.” At a basic level, it’s just not right.

I realize there is a little game of semantics here because when you do pick people for reductions, you often pick those who may not have been top performers. But it is strange for some of these firms to get rid of all of these people and say that they were all subpar performers, when for years many of those “underperformers” had received very positive performance reviews and the firms and clients said that they were happy with them.

So firms really should be honest about what they’re doing. The firms that have gotten themselves in trouble usually have not been.

Gazing ahead a bit—say, to five years from now—what do you think the future of the large firm might look like?

DL: Law is a profession that changes slowly. One thing about sites like ours, though, is that they do accelerate the pace of change, as the hiring partner of one firm told me. Trends spread a lot more quickly, whether those trends are pay raises or layoffs. Still, I think that in five years the profession will look somewhat similar to the way it looks now.

However, the billable hour will have less of a stranglehold as a method of charging clients. You may see more flat-fee arrangements and other alternative billing schemes, including more use of success fees. You may also see more flexibility in terms of how associates and partners are compensated, with a breakdown in lockstep compensation systems and the rise of systems that are more flexible, to recognize how different people are progressing or not progressing in their professional development.

You may also see a change in recruiting timetables. It’s possible that firms may try to figure out their hiring closer to the time that people actually graduate from law school, as opposed to this model now where essentially you “hire” people two years out, when you bring them in as summer associates with the understanding that the vast majority of them will get offers to return after graduation—which may be a cause of the deferrals we’re now seeing.

What would you say to young lawyers who have lost their jobs or, perhaps fresh out of law school, have never had a job at all? What are their options in today’s climate?

DL: We’ve been doing a series on the blog called “Career Alternatives for Attorneys,” looking at a lot of different things that people with law degrees can do and where the skills they’ve learned might translate. We’ve talked about such things as business development, communications and public relations, journalism and academia. But one of the challenges is that, unfortunately, some of those areas have been hit by their own problems as well. Not to sound too depressing, but it really is a grim job market.

One trend that we may see in the legal profession generally is people looking to create their own opportunities, as opposed to waiting for some outside employer or firm to serve it up to them on a silver platter. Lawyers of the future will have to be a lot more entrepreneurial about their careers. It’s not just a matter of finding some large firm, getting into it, and staying with it for 20 or more years.

It’s a trend being seen in the economy generally, where there is all this talk about the rise of a freelance nation. I think we’re definitely going to see it in the law. I would urge people to network a lot and to hustle a lot—even though that’s a skill set that’s a bit alien to lawyers because many of them believe, or just hope, that their work will speak for itself. However, in this day and age, you have to be aggressive and seek out people and opportunities.

I also think that law schools definitely need to adapt as well, to change the way they prepare their students for the real world. Law schools should become more practical perhaps in their orientation. Most of the time you learn a lot of theory and not as much about practice.

It’s really hard for today’s students because they are leaving law school with six-figure debt loads and now those starting salaries that they thought were going to be $160,000 have been pushed off into the indefinite future. I think the current model of law school education, both in content and in it being a three-year system, is beginning to collapse in on itself.

Actually, it might be safe to say that the $160,000 starting salary will be a thing of the past at many, but not all, law firms. I think the very elite New York firms will still preserve that salary.

One thing many people are seeing is that the midsize and smaller firms seem to be doing well right now. Do you envision a time when the midsize firms might assume some dominance in this market?

DL: My guess is that in the future midsize firms will play a bigger role in the legal economy in general, especially for large American corporations. A lot of general counsel are realizing that with midsize firms they can receive legal services of a very high quality, sometimes from people who are refugees from the large law firms, but at a much reduced price. To the extent that this economic crisis is forcing companies to look more closely at their legal costs, they are going to seek out somewhat lower-cost providers, so midsize firms and smaller firms—boutiques that are specialized in a particular practice area—are going to be receiving more sophisticated work. Much of that work is going to come at the expense of large law firms. It remains to be seen, of course, how this all works out in the end.

What’s your best prediction on when this downturn’s going to end for the legal industry and when we might see a return to some normalcy?

DL: Oh goodness! My guess—and I tend to be a pessimist on these things—is that the legal economy may not return to normal until 2011 or 2012, and it’s not clear whether even then normal will resemble what it was before this or if it will be some different kind of normal. So maybe 2011 or 2012 is when you might expect to see some sort of stabilization, but the new equilibrium could be very different from what we enjoyed prior to this recession.

Click here to read the complete interview with David Lat in the magazine's Online-Only Content section.

 

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