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The 2015 Vault Law Firm 100 Ranking & What It Takes To Get To The Top

The 2015 Vault Law Firm 100 rankings are in. Considering this economy, it’s not surprising that litigation powerhouses are taking the lead.

Still fighting for the No. 1 and No. 2 spot, Wachtell, Lipton, Rosen & Katz takes the lead with Cravath, Swaine & Moore following suit. Although both firms excel at far more practice areas than litigation—including corporate, tax, and trusts and estates—lawsuits seem to be driving America or, at the very least, this list of top ranking firms.

Take, for example, Quinn Emanuel and Boies Schiller, who continued to ascend in the Vault Law 100 this year.

Quinn Emanuel first reached the Top 40 ranks in 2009, Top 25 in 2010. This year it is No. 15 this year. Renowned for its trial skills and ranked No. 1 for General Commercial Litigation in Vault’s 2014 rankings, survey respondents called the firm “innovative,” “intense,” “feared” and the “best litigation firm in the U.S.,” according to Above The Law Blog (ATL).

Quinn Emanuel’s litigation expertise is diverse, taking on all areas of litigation: products liability, appellate litigation, all types of class actions, clients can take their pick.

And, with lawsuits on the rise—patents, securities, employees, class action suits—there’s no wonder litigation firms are leaders of the pack.

All this just to say that even one-trick ponies aren’t just one-trick ponies; they have two, three, four practice areas up their sleeve.

And while the major New York-based firms continue to dominate, smaller firms can still make a name for themselves via innovation.

According to the Vault (and ATL), here are the Top 15 firms for 2015:

  1. Wachtell, Lipton, Rosen & Katz
  2. Cravath, Swaine & Moore
  3. Skadden, Arps, Slate, Meagher & Flom
  4. Sullivan & Cromwell
  5. Davis Polk & Wardwell
  6. Simpson Thacher & Bartlett
  7. Cleary Gottlieb Steen & Hamilton
  8. Weil, Gotshal & Manges
  9. Kirkland & Ellis
  10. Latham & Watkins
  11. Gibson Dunn & Crutcher
  12. Covington & Burling
  13. Boies, Schiller & Flexner
  14. Paul, Weiss, Rifkind, Wharton & Garrison
  15. Quinn Emanuel Urquhart & Sullivan

The full list is available here.

As litigants are increasingly in demand, it is no surprise that litigation support is increasingly desirable, as well.

A recent survey by ALM Legal Intelligence reveals that the hourly base pay for paralegals continues to rise. Salaries for paralegals, litigation support and docketing workers at both law firms and law departments, according to the ALM/IPMA Annual Compensation Survey for Paralegals and Managers, 2014 Edition, released yesterday, are all implicated.

Conducted annually since 2002, the 2014 survey included 298 law firms and law departments reporting on over 9,500 paralegal, litigation support, and docketing positions.

According to their findings, at law firms, the highest hourly-pay positions are Litigation Support/Technology/eDiscovery Manager at $79.66 and Paralegal Director at $76.42. Among law departments, Paralegal Supervisor was the highest paid position at $70.32, followed by Litigation Support/Technology/eDiscovery Director/ Manager at $65.35, reports the ALM.

Law firm paralegals, the largest group reported, increased average hourly base pay to $36.57 from $35.98 in 2013, while law department paralegal pay jumped to $34.30 from $31.46.

Law firm bonuses on average increased most noticeably for Paralegal Directors at $18,421, compared to $16,149 the prior year.

Specialists/Industry Analysts bonuses rose to $6,939 from $5,749. Law firm billing rates for paralegal positions increased an average of 4 percent.

If you’re a law firm manager, should you care?

Well, it may be that the salaries of your first-year associates look a lot more attractive as litigation support than ever before. And, your first “innovative” act as a climbing-the-ranks firm might be reevaluating traditional legal positions and finding alternative arrangements, instead.

Competition to the top has never been fiercer. Pony up!

Are all your employees accurately classified as exempt or non-exempt? How can you be sure?

Businesses of all shapes and sizes are being forced to pay out big bucks for misclassifying employees and failing to pay proper overtime. In fact, the number of FLSA-related lawsuits in federal courts has spiked by 250% in the past decade.

Is your company at risk? The DOL estimates that nearly 70 percent of employers are not in compliance with the Fair Labor Standards Act (FLSA)!

Introducing FLSA Compliance: Your Practical Guide to Overtime Exemptions and Wage and Hour Law – a no-fluff, plain-English report you can to master the ins and outs of this complex law.

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Government Investigations Increase Litigation, Jobs For Law Firms

New regulation and stricter enforcement of it has high-stakes litigation constantly in the news. Just this Thursday, the SEC, passed a new set of guidelines, opening the litigious gates to potential floods of lawsuits against companies that fail to disclose to investors their cybersecurity risks and vulnerabilities.

In reverse, individuals, companies, and even U.S States are drumming up new lawsuits everyday. In fact, quite a few state governments are challenging the Affordable Care Act among other new federal reforms laws.

Today, the SEC suit against Citigroup is reaching a tipping point. Citigroup Inc. has agreed to pay the Securities and Exchange Commission between $200 million and $300 million, according to people familiar with the matter, as reported by the WSJ’s Jean Eaglesham and Suzanne Kapner.

If the settlement is accepted, it will be one of the highest payments made by a firm to the SEC to settle charges, according to the WSJ.

The SEC will vote this morning on a proposed agreement with Citigroup in regards to civil fraud charges related to Citigroup’s sale of a $1 billion mortgage-bond deal called Class V Funding III, created by Citigroup in 2007 and alleged misleading of investors.

The overwhelming number of regulation litigation is one of the major reasons why one-quarter of respondents to a 2011 Fulbright Litigation Trends Survey expect next year to bring increased litigation and regulation as companies attempt to grow in today’s volitile economy.

In the survey, one-third of corporate counsel reported an increase in external regulatory inquiries directed at their companies. Not a surprising statistic after you evaluate the plethora of news headlines on the matter.

For attorneys, this is good news. More lawsuits means more business.

In fact, ninety-two percent of U.S. corporate counsel in the survey predicted a rise or, at least, even level of litigation to occur over the next twelve months.

“Our survey respondents have a front-row seat to the increased scrutiny brought on by stricter regulatory enforcement,” Stephen C. Dillard, the head of Fulbright’s global disputes practice, said to Fulbright & Jaworski LLP News.

“This year, our survey confirmed a heightened level of governmental investigations focused on the energy and insurance industries, with the health care, manufacturing and engineering sectors not far behind.”

So, as stricter regulation and company growth continues to drive an increase in litigation, how will your firm accommodate this trend?

It’s important, as well as your ethical responsibility, to keep your clients apprised of regulatory developments that may affect their business. In your firm’s blog or client newsletter, explain what preventative measures can be taken to decrease the risk of future litigation and accommodate new legislation.

At the same time, take advantage of this time for open dialogue to explain to your clients what practice areas at your firm could be of service to them.

Whistleblowers remain a growing concern for businesses this year, according to Fulbright’s survey. Thus, for your clients at risk, prepare contingency plans for possible internal investigations or audits. Oversee their employee contracts and create policies regarding disclosure of confidential information.

Now is the time to take advantage of a growing market for litigation. So, convene a meeting with managing partners or law firm administrators to create a plan to harness this trend.

Implement a strategy that (1) informs current clients of new regulations; (2) demonstrates the breadth legal expertise and capabilities of your firm to both current and new clients; and (3) increases targeted advertising to attract new clients and companies victim to and at risk of unwanted government attention.


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Smoke Manufacturers Coughing Over Graphic FDA-Mandated Labels

If you’re a former smoker or if you’ve never smoked—as long as you’re not currently smoking–you’re likely to be appalled every time you are in line at a Customer Service aisle of a major supermarket, or at a mini-mart or bodega, or wherever stacks and stacks of cigarette cartons are on display behind the store clerk.  You’re reminded that people are paying exorbitant amounts to do something to themselves that has been proven to NOT promote their general welfare.

The price in some area of the country is somewhere around $6.80 per carton.  (Can you believe a U.S. Territory—the U.S. Virgin Islands–sells them for $17 per carton?)

Before the FDA banned candy and fruit flavored cigarettes in 2009, these were meant to attract teenagers.  Teenagers are still a large smoking demographic. So are many other segments of the population. This, despite the fact that smoking is the leading preventable cause of death in America.

Sometimes, no matter what the FDA or anyone else might hit them over the head with, smokers won’t stop smoking until the inevitable happens.  But then that’s exactly what gets others to stop.  For instance, Barb Tarbox of Edmonton, Canada, an ex-model, “got angry when she got diagnosed with a life-threatening disease”.

According to “The Ultimate Quit Smoking Guide” “She spent the last [seven] months of her life parading her…emaciat[ed] body and bald head[–]due to radiation[–]around schools, TV spots, print ads and anywhere she could [to] get the message across to try and stop ‘even one child from picking up a cigarette’, ” she said.  Apparently, her efforts were not in vain.

So what’s the FDA to do, to show it means business?

Most recently, it’s placed powerful graphics on cigarette labels. And the cigarette manufacturers are putting up a stink.

The Wall Street Journal Law Blog recently noted that tobacco manufactures are suing to block the new cigarette labels.  One label has a picture of a man smoking through a hole in his throat. Another label features pink, healthy lung tissue next to diseased and darkened lung tissue.  Is it enough to turn die-hard smokers off their habit?  According to the  WSJ, the FDA predicts that the new packs will result in 213,000 fewer smokers in the first year alone.

The new labels are due to be affixed on packs in 2012, notes the WSJ.   They will be on the top half of the front and back of the pack—hard to miss, even through a cloud of smoke.  The visual will be accompanied by the message “Smoking can kill you.”

As the WSJ Law Blog has noted in previous pieces, three “tobacco companies have filed litigation claiming that federal labeling rules and marketing restrictions on cigarettes infringe the companies’ free speech rights.”  Now, most recently, a fourth company has filed a suit against the federally-mandated suit, requesting an injunction that will delay the rule’s implementation.  What’s their worded logic?  That it’s unconstitutional.

“The notion that the government can require those who manufacture a lawful product to emblazon half of its package with pictures and words admittedly drafted to persuade the public not to purchase that product cannot withstand constitutional scrutiny,” Lorillard attorney Floyd Abrams said.

To get an idea of how much cigarette cartons cost, go here: http://www.city-data.com/forum/shopping-consumer-products/604027-how-much-you-paying-pack-cigarettes.html


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Need to Know How Law Firms Are Holding Up Across The Globe?

If an administrator, lawyer or client wishes to examine the top-tier firms in say, Germany, where she or he will be travelling for business, there’s a good chance she or he will eventually check out the 20-year old Legal 500, in either print or online form.  This compilation in capsule formula—the UK’s invention—is good for a quick perusal of firms’ capabilities world-wide and is pretty exhaustive. It seems to keep readers up-to-the-minute on the local happenings in each region.

One imagines that this sort of data can come in handy when, for example, one is headed for a never-before-been-to part of the world. Or, if your firm is planning on setting up shop a far distance from home turf, you’ll want to examine the new territory by putting out feelers as to where firms have been successful in this new venue, and where they haven’t.

So what does this birds-eye-view series—the company also puts out e-books per region and industry (downloadable on Kindle, iPhone, iPad etc.)–have to say about each country, per practice area?

Let’s look at a few representative examples.  If we  examine the reportable launches and leavings of firms in, say, Thailand, we learn that politics have affected investments and tourism but that the economy is robust, due to the Thai bank’s closed door policy to derivatives and the like.  Baker & McKenzie is the largest firm of note.

On to Scotland, which seems to have four big firms dominating. These are listed as  Dundas & Wilson LLP, Maclay Murray & Spens LLP, McGrigors LLP and Shepherd and Wedderburn. We read, too, that Edinburgh’s reliance on financial services has made it susceptible to the downturn.

As to Scottish trends; there is a sense of Londoncentricity in the air, and there are lateral hires aplenty.

In China, although M&A activity increased, private equity funds didn’t do well.  Many practices underwent serious downsizing.  However, it’s expected that, as soon as US and European markets recover, there will be a lot of incoming activity in the months to come.

And guess which firms reported upstepped momentum? Those firms housing “strong” litigation and employment practices.   Additionally, there is what has come to be termed a great deal of “internationalization” (or, as the British say, “internationalisation”) of local firms.  In that arena, rainmaker Rupert Li left Clifford Chance LLP for King & Wood.

In Germany, antitrust experts are being wooed in the aftermath of the global recession.  In particular, they are being sought for advice in the areas of summary proceedings and compensation claims.  There is also a great deal of that oft-used phrase, now, “cautious optimism” about the possibilities around the corner.  Another word that is tossed about much is “transparency”.

There was a notable lack of activity in areas such as private equity; this affected many German firms’ bottom line.   Also, Germany is learning from the West: “Firms have increasingly looked towards Chapter 11 bankruptcy proceedings in the US to learn what may be adapted…for German or European insolvency legislation,” we read.  “As a result, the criteria by which German judges choose insolvency administrators for particular cases is increasingly becoming a subject of discussion.”

It’s not inconceivable to think that, if your firm is not already so structured, in the years to come you’ll be doing business in quite a few of the 90 countries represented here. No one lives or works in a bubble anymore.  In fact, we’re all closer to other parts of the world than we think and a site like Legal500 seems to lessen the distance ever so slightly with these snapshot views.

To read more, go here:  http://www.legal500.com/


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The Scoop on Personal Lawsuit Trends – Adding Fuel to the Fire?

Fresh on the heels of yesterday’s blog on the “hot” topic of the pro’s and con’s of tort reform as seen through the eyes of lawyers, we’ve unearthed another interesting article which might be seen as adding fuel to the fire, but which, nevertheless, posits intriguing contra points.    Citing sources like the U.S. Census Bureau; National Manufacturing Week; stats from the Bureau of Justice Statistics and the AMA, the American Association for Justice picks off many dyed-in-the-wool legendary “truisms” that make the water cooler rounds.

Some industries have more of these water coolers than others, per the AAJ.    In particular, we read that: “[d]rug, oil, and insurance companies have spent millions of dollars to generate myths about how lawsuits are out of control and responsible for all of America’s ills.” And the AAJ is prepared to “debunk these myths”.

For instance:    Lawsuits hurt small businesses. Negative, says the AAJ.  The author quotes the National Association of Manufacturers as noting “lawsuit abuse” is way at the very bottom of concerns for manufacturing firms.

Additionally, numerous surveys have shown that entrepreneurs in this size category have so many other legitimate concerns that “costs and frequency of lawsuits / threatened suits” ranks 65th on such a list.

Here’s another:   Lawyers charge so much per hour that victims are left with paltry sums.  Not so, we read. “For over 200 years the contingency fee system has provided Americans who must go to court with a degree of access to justice that is unheard of in most other countries,” the article notes.   Insurance rates will go through the roof because of so many lawsuits.  According to the AAJ, your insurance company is making huge profits its priority.  “Their profits continue to rise,”  we read, “and unfortunately, your premiums are following suit.”

Insurance companies have been known to say that caps would remedy the situation. However, they have also admitted that such caps on awards would not lower premiums.  “We have not promised price reductions with tort reform,” said a spokesperson for the American Insurance Association.   And what about the idea that health care costs are continuing to rise, and that physicians simply can’t afford to practice anymore, due to litigation?

It’s true that healthcare costs are skyrocketing, we read, but it has nothing to do with malpractice suits.  According to the AMA, only 2% of overall healthcare spending was attributable to such suits.

So what’s pushing the cost ever upwards?  Try the 40% increase in doctors since 1990 versus only an 18% general U.S. population increase.   The AAJ piece also makes the case that the number of tort or personal injury cases has actually been diminishing.

Quoting the National Center for State Courts, it states that tort cases declined by 25% in recent years.  And in the nationals largest 75 counties—where, if lawsuits were increasing, you might expect a sizable chunk of personal lawsuits to have been filed—“the number of tort trials decreased 31.8 percent between 1992 and 2001.”


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Harbinger of Things to Come? In California, Demand for Midlevel Associates is “Extraordinary”.

Until recently, the number of viable openings for associates was not looking good in the Valley, as the southern part of the San Francisco Bay area is affectionately known. In a place that has long been deemed a barometer of all things economic, head hunters had such light schedules they downsized to a four-day week.  

That’s all in the past, now, claims “The Recorder”, which publishes “Essential California Legal Content”.   A recent issue mentioned the rebound of M&A (mergers and acquisitions) and IPO (initial public offerings) activity. 

In fact, there is now so much demand for midlevel associates (particularly in corporate departments) that Swan Legal Search principal Delia Swan has had to hire two more recruiters.  

It’s only part due to client demand. Another factor at work is that, since law firms have trimmed down, now that excess projects are showing up, there aren’t enough lawyers to handle the work. And so administrators are scurrying around looking for new lawyers.  

“It’s been a long time coming,” Swan said. “Firms have trimmed so much there’s no room to take on excess work. They necessarily have to hire new people.”  

Great news, but what about salaries?  Are they still stalled or, worse, getting smaller?  Nope. Just the opposite.  Cooley, and Wilson Sonsini Goodrich & Rosati, having noticed that associates are once again in demand, have raised their own associates’ salaries, bringing them up to par with what standard salaries were pre-recession.  

Whereas Cooley had lowered its base salary for a fourth-year associate to $185,000, they’ve now increased it to $210,000.  Wilson Sonsoni, too, has moved its fourth-year associates to around that level.  

It’s not just the corporate world that is buzzing again. Perhaps due to a domino effect, litigation, patent prosecution and licensing are all booming, and these lawyers are in high demand.  

And, always a sign that things are on the upswing, smaller firms in the area are looking to expand.  The managing director for Major, Lindsey and Africa’s San Francisco office didn’t mince words: “The demand is just extraordinary right now.”  

So what are the actual numbers?  Cooley has added 16 associates to its Palo Alto office since January of this year. Granted, some were first years, but many were lateral hires. The partner noted that they’re looking for three more midlevel associates for their patent prosecution, corporate and IP departments.  

Firms are competing with in-house departments to meet their needs. 

Another head hunter—Scott Dubin of the Dubin Group in San Francisco—is scouring his sources to come up with ten licensing and patent litigation lawyers for a Fortune 500 corporation.  He did admit that corporatons tend to hire more senior associates than firms, but “[s]ometimes their needs…overlap,” he noted.


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When a SaaS Chooses A Law Firm – Is Smaller the Better Way to Go?

So the dust has settled and Software as A Service Providers (also known as “on demand” software), are becoming known as the software delivery model of the land.  This is where software and its associated data are hosted centrally, typically in the Internet/Cloud. (Sometimes this service involves firm-specific, on-premises software.)  Wouldn’t you like to know what sort of law firm they’d be interested in using?

To flesh this topic out a bit, contemporary SaaS companies typically develop and manage their own software and provide them to “tenants”–as opposed to managing and hosting third-party independent software vendors’ software, as earlier application service providers did.   Used mostly as business applications, SaaS companies represent a large chunk of worldwide software sales.   By 2014, 16% of those worldwide software sales will be provided by SaaS applications.  

With all the disseminating of information that will be going on–as these companies seek to implement “best practice” scenarios in the field of software–there are bound to be some legal ramifications coming down the pike.  It might therefore be worth examining how these guys select a law firm and, similarly, how they view legal fees.   

OpenView Labs “invest[s] in and partner[s] with companies to help them become large, dominant players”.  They target “expansion stage software” and internet companies. Jeremy Aber, Senior Advisor, is a software licensing attorney who has also worked in-house at two software companies.  In a recent post, he explains that “one law firm might not be the right fit”.  He also likes smaller firms for SaaS groups.

Rather than hire a firm they’ve heard of through their social circles—or, for that matter, settle for an attorney who seems to know something about IP or software—the up-and-coming company should consider their attorney “the most outsourced function of any small business”.   At the beginning, that sort of attorney may be all right, but, as the company grows, they need to rethink their choice.  

“A better way to handle this is to hire several specialized solo or small firms,” he believes. Because of their specialization, these firms are able to provide better advice and, because of their size, cost savings. This, he explains, also applies to employment matters and intellectual property issues. 

Aber offers the one exception: if the company is looking for outside investors or venture capitalists, they’d be better off with a corporate lawyer in a medium-to-large law firm.  

As to litigation, the author recommends that, due to the increase in the hourly fee for partners in large law firms—from $500 to $700 in the last decade—small firms are better.  When it comes to larger firms, Aber notes that: “Those firms are, in essence, say­ing to the legal buyer of their ser­vices that they only want to rep­re­sent large com­pa­nies with large bud­gets.” He admits to generalizing, but says that, since some of the smaller firms are spin-offs of larger firms, you may, in hiring a smaller firm, even get a top-notch law firm lawyer at a much more affordable rate.  

He then goes on to suggest that, in litigation, you may not need the best attorney money can buy: what you may, instead, need is a good one with “reasonable hourly rates”—he mentions $200-something as a good fee—who is attuned to the results you are looking for.  This, he says, is because 90% of all such cases settle before going to trial.  “The tac­tic is to starve the oppo­nent of resources, to ensure a win.” 

To read more, go to: http://labs.openviewpartners.com/how-to-hire-the-right-law-firm-and-manage-legal-fees/ and  http://en.wikipedia.org/wiki/Software_as_a_service

Graphic courtesy of OpenView Labs


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