Biglaw is dying

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Re: Biglaw is dying

Postby TLSModBot » Sun Feb 12, 2017 3:30 am

Explain what "lol cap you got your whole sky is falling shtick" means

Also is your "huge amount of data" just you pointing to the fact that automation and effects on job growth isn't a perfect correlation?

Lol.

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Re: Biglaw is dying

Postby Npret » Sun Feb 12, 2017 3:34 am

FWIW I thought the main issue with biglaw was that once the recession hit, clients aggressively went after fees in a way they just never had before. Now that they have money, they aren't going back to the old days.

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Re: Biglaw is dying

Postby Tiago Splitter » Sun Feb 12, 2017 3:38 am

Capitol_Idea wrote:Explain what "lol cap you got your whole sky is falling shtick" means

Also is your "huge amount of data" just you pointing to the fact that automation and effects on job growth isn't a perfect correlation?

Lol.

lololol

you've been going on for years about the biglaw world being a lurking disaster based on the citi report. That's what I'm talking about.

lololol

The data is the fact that biglaw firms have been hiring insane numbers of people. Way, way more than they hired back before technology, and way, way more than they were hiring just after the financial crisis. Until you can address this the rest of the "biglaw is dying" story feels a little hollow. Bad firms going under and giving up associates to better firms doesn't make a dime's worth of difference to people at good law schools.

lololol

Maybe the better question is this: when will going to a good law school no longer make biglaw extremely likely? "Modest growth in a fragile legal economy" (your words) would suggest things are gonna be fine for a while.

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Re: Biglaw is dying

Postby Wacked Wombat » Sun Feb 12, 2017 9:42 am

http://www.oxfordmartin.ox.ac.uk/downlo ... oyment.pdf

Study done in 2013. Lawyers themselves have a lower than 4% probability of being replaced by automation. Paralegals and Legal assistants on the other hand have a 94% probability of being replaced.

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Re: Biglaw is dying

Postby TLSModBot » Sun Feb 12, 2017 10:33 am

Sigh. Here is why that argument is dumb tiago. I'll try to use small words:

1. Your argument is essentially that automation must cause job loss absent other factors otherwise it never can. Probably not your intent but that's the logical underpinning of your post above.

2. This ignores the larger context of the legal market. I'll give you a brief history but encourage you to read a fucking book or two on it ("Tournament of Lawyers" immediately comes to mind, with the follow up "Elastic Tournament" for why law firms grew structurally throughout the past 40 years, and Adam Smith Esq. has some decent reading that gives a very brief history of how and why external conditions grew the legal market incredibly).

2a. Law firms were small and poor things up until the late 60's. Work grew due to, in part, A. the increase in business size and complexity, B. the increasing complexity of the regulatory state, C. a lack of competition and comparison between firms, and D. The ability of lawyers and the Bar to position themselves as sole gatekeepers of litigation and deal work in a variety of forms.

2b. Automation has been a persistent force throughout, but work and billing rates grew at such a huge volume that it didn't make a dent in billable hours.

2c. Now we have flat revenue at the industry levels, explained not merely by recession but by encroachment by non-law firm providers, cost consciousness by clients and in-sourcing of work, and a monumental leap forward in technology (fully automated doc review, legal expert systems, systems that can read and parse contracts, etc.). There is no indication this will change but if you have literally any evidence to the contrary I'd be interested to see it.

2d. The technology aspect has not been fully Incorporated yet and I'm less bullish on the rate of adoption than I used to be, but it's foolish to think law firms are permanently insulated from this.

3. That there will be legal work specifically for lawyers does mean there will be the same amount and type of work. Unless you are utterly blind to facts or arguing in bad faith (I can't tell which yet with you), the fact that contract attorney market has been decimated by these changes should be indicative of what's to come for junior associates. This is where Susskind actually makes a good general point: automation flows uphill. What was the work of temps is disappearing, slowly but inevitably. Next up are the junior tasks that are mindless but add up those billables.

There is a core of work, even for juniors, that is inherently legal. It can be made more efficient but not fully eliminated. But that says nothing of volume. I think volume is going to go down absent some radical change in regulation or the economy that suddenly creates a massive need for more lawyers.
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Re: Biglaw is dying

Postby TLSModBot » Sun Feb 12, 2017 10:45 am

What this means is that automation efficiencies, no longer tempered by wild industry growth, will and are reducing demand. This is now several years in the running.

Law firms are feeling the effects. A solid third of AmLaw 200 firms haven't been growing for 2 or more years now. That means no rise in PPP. That means other firms can poach partners with more attractive paydays. This means more law firm mergers and collapses. The rate of both is increasing, by the way, it tends to happen to smaller firms first and not make the news. Desperation merging is often a delaying tactic for the inevitable (Dewey and Bingham are examples here).
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Re: Biglaw is dying

Postby TLSModBot » Sun Feb 12, 2017 10:54 am

I will say, to your limited credit, that there are countervailing forces that slow this. They do nothing, however, to undermine or challenge these market movements so ultimately they will fail:

1. Slow rate of adoption of tech by law firms. Firms have been "automating for years" but always WAY behind the curve of other industries. The more cost saving tech out there, along with studies showing its defensibility and a couple defectors willing to adopt it aggressively (Seyfarth and Crowell, etc.), you'll movement in this direction. I am less pessimistic than Johann about how quickly this will happen.

2. Continued reliance by clients on law firms to "just run things". In House counsel are getting smarter and more robust, but there still is a huge history of just letting outside counsek do it all. We are seeing increasing rates of disaggregation of work product (I.e. multiple firms working piecemeal on large matters), increased in-sourcing of legal work, direct negotiation between clients and outside vendors seeking to take law firms' lunches, and bidding wars between firms for client matters.

3. The complexity of regulatory rules and protection of the Bar. I think we're moving towards less regulation and easier paths for clients to understand and follow regulatory requirements. Especially now that Cheeto Man runs the fucking country. The more clients can not deal with regulatory work or shift it to non-lawyer compliance departments, the less that flows to law firms.

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Re: Biglaw is dying

Postby Abbie Doobie » Sun Feb 12, 2017 11:11 am

sure, the market for mass produced factory-style legal services is on the decline; the future is in cage free grass fed no-hormone organic legal services.

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Re: Biglaw is dying

Postby smaug » Sun Feb 12, 2017 11:52 am

I think y'all are just talking past one another.

I don't think Cap is spelling doom for the entire legal industry and never has; he's just pointing out the pressure on a part of it, which is significant.

I think Tiago is right to point out that even as technology has been adopted by the legal industry it hasn't always caused a reduction in legal work, even when you'd expect it to. I think a lot of that is client driven and caused by ever-shifting expectations.

Even with predictive coding for doc review (something I think we all agree is coming) it's hard to say exactly how much, if at all, it'll cut down work.

Regarding profitability, I think folks mischaracterized Dewey above and kinda miss the point that Cap is making or has made before: when you look at lateral partner hiring, salary guarantees, mergers, &c. it becomes pretty clear that profitable law firms have an ability to poach well performing (and arguably undervalued) partners from firms that struggle. Try to pull in laterals with guarantees (and without sufficient workflow) is a big part of the Dewey explosion. But, that doesn't mean it always fails. The same model is what allowed Quinn to become so profitable and large so quickly.

Eventually, those partner moves will make less sense, because without pulling sufficient associates with them, there's just not going to be enough billing to support all of the partner deflections, but that shouldn't cause an explosion or mass exodus, just a reshifting for the firms that do it well.

It's also clearly not necessary to run things that way: some of the most profitable firms take totally different approaches and are successful.

Anyway, not sure I understand the vitriol which is odd coming from me of all people.

Petition to rename the thread to "(Some) Biglaw firms are (still) dying (slowly). Also, automation is a thing."

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Re: Biglaw is dying

Postby sikemenow » Sun Feb 12, 2017 2:40 pm

Also seems like the market is pushing litigation to boutiques that are leaner and work with flexible billing models, while transactional work can still find a home in biglaw. But even transactional biglaw work may need to improvise away from the pyramid billable hour model. Thoughts on transactional fees shifting more towards a bank model (e.g. Percentage of the transaction contingent on success)? I know the argument is conflict of interest on the attorney side, but sometimes that just seems like a copout.

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Re: Biglaw is dying

Postby GreenEggs » Sun Feb 12, 2017 2:45 pm

Let me tell you how I buy something these days. I know what I want I go on the internet, I get the best price. Or I don’t know what I want and I go to a small store that can help me. The era of personal service is back. You are back. You’ll find that customers will pay our higher prices and then they will thank us, and we will say to them “you are welcome.”
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Re: Biglaw is dying

Postby mvp99 » Sun Feb 12, 2017 2:58 pm

sikemenow wrote:Also seems like the market is pushing litigation to boutiques that are leaner and work with flexible billing models, while transactional work can still find a home in biglaw. But even transactional biglaw work may need to improvise away from the pyramid billable hour model. Thoughts on transactional fees shifting more towards a bank model (e.g. Percentage of the transaction contingent on success)? I know the argument is conflict of interest on the attorney side, but sometimes that just seems like a copout.

Biglaw is already in the contigency territory

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Re: Biglaw is dying

Postby Hutz_and_Goodman » Sun Feb 12, 2017 3:43 pm

I read an article recently that a big law firm had an amazing quarter because of one or more big contingency cases.

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Re: Biglaw is dying

Postby sikemenow » Sun Feb 12, 2017 4:06 pm

mvp99 wrote:
sikemenow wrote:Also seems like the market is pushing litigation to boutiques that are leaner and work with flexible billing models, while transactional work can still find a home in biglaw. But even transactional biglaw work may need to improvise away from the pyramid billable hour model. Thoughts on transactional fees shifting more towards a bank model (e.g. Percentage of the transaction contingent on success)? I know the argument is conflict of interest on the attorney side, but sometimes that just seems like a copout.

Biglaw is already in the contigency territory


On the litigation side, yes obviously. I hear less of it on the transactional side.

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Re: Biglaw is dying

Postby 2014 » Sun Feb 12, 2017 4:44 pm

sikemenow wrote:
mvp99 wrote:
sikemenow wrote:Also seems like the market is pushing litigation to boutiques that are leaner and work with flexible billing models, while transactional work can still find a home in biglaw. But even transactional biglaw work may need to improvise away from the pyramid billable hour model. Thoughts on transactional fees shifting more towards a bank model (e.g. Percentage of the transaction contingent on success)? I know the argument is conflict of interest on the attorney side, but sometimes that just seems like a copout.

Biglaw is already in the contigency territory


On the litigation side, yes obviously. I hear less of it on the transactional side.

Pure success fees are rare but on the transactional side there's already movement to flexible arrangements such as charging different rates depending on if a deal is consummated and on what timeline or billable hours with a fee cap after which the firm gets paid nothing or some negotiated lower rate.

Pure black hole billable hours matter (e.g. full billing rates, as many attorneys as necessary, as many hours as it takes) will probably be more and more rare but it's already on firms' radars.

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Re: Biglaw is dying

Postby androstan » Thu Feb 16, 2017 9:20 pm

SemiReverseSplinter wrote:As long as humans make and interpret the law, humans will be needed to argue the law.

Also, if you want to own a mansion, sell something that rich people want; if you want to own a castle, sell something that poor people need.


I like this. I'm going to use it at some point without attribution.

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Re: Biglaw is dying

Postby androstan » Fri Feb 17, 2017 8:30 am

My experience at biglaw lit (but not ultra elite) is that we have an overall budget for the case through expert discovery, and a monthly budget. Typically it's pretty easy to stay within that budget, because our group is relatively small. If it proceeds to trial, there isn't really a budget anymore, but there's only so many hours 4-6 attorneys can bill anyway.

I'm so glad we don't do contingency fees.

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Re: Biglaw is dying

Postby androstan » Fri Feb 17, 2017 9:10 am

androstan wrote:My experience at biglaw lit (but not ultra elite) is that we have an overall budget for the case through expert discovery, and a monthly budget. Typically it's pretty easy to stay within that budget, because our group is relatively small. If it proceeds to trial, there isn't really a budget anymore, but there's only so many hours 4-6 attorneys can bill anyway.

I'm so glad we don't do contingency fees.

I should say we do defense work almost exclusively, so contingent fees wouldn't generally make much sense.

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Re: Biglaw is dying

Postby TEM » Mon Feb 20, 2017 6:34 pm

TBH I haven't read any of the posts after the first page, but I saw this website last semester and thought it was interesting. Sorry if it has already been posted in the last few pages:

http://www.bbc.com/news/technology-34066941

It predicts what jobs are at the most risk of being replaced by automation. If you type in "barrister" (lawyers across the pond), the site says that lawyers are 320th in line out of 366 jobs to be automated. In other words, it says the risk is quite low (over the next 20 years, at least). However useful or predictive this is is questionable, of course, but interesting nonetheless in my opinion.

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Re: Biglaw is dying

Postby TLSModBot » Mon Feb 20, 2017 7:13 pm

TEM wrote:TBH I haven't read any of the posts after the first page, but I saw this website last semester and thought it was interesting. Sorry if it has already been posted in the last few pages:

http://www.bbc.com/news/technology-34066941

It predicts what jobs are at the most risk of being replaced by automation. If you type in "barrister" (lawyers across the pond), the site says that lawyers are 320th in line out of 366 jobs to be automated. In other words, it says the risk is quite low (over the next 20 years, at least). However useful or predictive this is is questionable, of course, but interesting nonetheless in my opinion.

Interesting in the way a Breitbart article is, sure

Methodology

Oxford University academics Michael Osborne and Carl Frey calculated how susceptible to automation each job is based on nine key skills required to perform it; social perceptiveness, negotiation, persuasion, assisting and caring for others, originality, fine arts, finger dexterity, manual dexterity and the need to work in a cramped work space.

Lol

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Re: Biglaw is dying

Postby Monochromatic Oeuvre » Mon Feb 20, 2017 7:52 pm

So midlaw employment collapses, education jobs disappear, the government freezes hiring, shitlaw salaries stagnate, and you people spend five pages debating the "death" of the one sector of legal employment that's hired more people since the recession (and at higher wages, too).

Someone help me figure out how we got here.

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Re: Biglaw is dying

Postby 84651846190 » Mon Feb 20, 2017 8:25 pm

God dammit, why can't we just form an actual cartel like the doctors and keep our salaries artificially inflated? This is not rocket science, people.

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Re: Biglaw is dying

Postby TLSModBot » Mon Feb 20, 2017 8:33 pm

Monochromatic Oeuvre wrote:So midlaw employment collapses, education jobs disappear, the government freezes hiring, shitlaw salaries stagnate, and you people spend five pages debating the "death" of the one sector of legal employment that's hired more people since the recession (and at higher wages, too).

Someone help me figure out how we got here.

It's almost like A. these things are connected somehow and B. Biglaw is more salient to TLS'ers as it is the home or (intended) destination of many of us!

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Re: Biglaw is dying

Postby Monochromatic Oeuvre » Mon Feb 20, 2017 9:19 pm

Capitol_Idea wrote:
Monochromatic Oeuvre wrote:So midlaw employment collapses, education jobs disappear, the government freezes hiring, shitlaw salaries stagnate, and you people spend five pages debating the "death" of the one sector of legal employment that's hired more people since the recession (and at higher wages, too).

Someone help me figure out how we got here.

It's almost like A. these things are connected somehow and B. Biglaw is more salient to TLS'ers as it is the home or (intended) destination of many of us!


So it looks like (a) Biglaw didn't hire fewer people now, and it's not planning on hiring fewer people for two years from now, and firms are still getting record levels of revenue from their lawyers, and even though we can sort of guess what threats might come from automation/offshoring, there are layers of guildism, regulation, inefficiency, and clients who are too rich to give a shit to peel through, and (b) It looks like most other sectors of legal employment are actually kind of dying, but we don't give a shit because most of us who gather to discuss this stuff don't do those things.

What exactly is supposed to keep a junior associate, or a 2L, or some college kid with a Powerscore, up at night?

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Re: Biglaw is dying

Postby Tiago Splitter » Mon Feb 20, 2017 9:21 pm

Monochromatic Oeuvre wrote:
Capitol_Idea wrote:
Monochromatic Oeuvre wrote:So midlaw employment collapses, education jobs disappear, the government freezes hiring, shitlaw salaries stagnate, and you people spend five pages debating the "death" of the one sector of legal employment that's hired more people since the recession (and at higher wages, too).

Someone help me figure out how we got here.

It's almost like A. these things are connected somehow and B. Biglaw is more salient to TLS'ers as it is the home or (intended) destination of many of us!


So it looks like (a) Biglaw didn't hire fewer people now, and it's not planning on hiring fewer people for two years from now, and firms are still getting record levels of revenue from their lawyers, and even though we can sort of guess what threats might come from automation/offshoring, there are layers of guildism, regulation, inefficiency, and clients who are too rich to give a shit to peel through, and (b) It looks like most other sectors of legal employment are actually kind of dying, but we don't give a shit because most of us who gather to discuss this stuff don't do those things.

What exactly is supposed to keep a junior associate, or a 2L, or some college kid with a Powerscore, up at night?

It's just a provocative thread title to get the discussion going. If you want to work at a big firm the path is still pretty obvious and relatively simple. 10 years from now who knows.



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