Change my mind: Layoffs and no-offers should happen in biglaw Forum

[beepboopbeep]

cartoon-dog meme:

give [top-notch legal work]!
no [paying your associates with whatever structure you find effective for getting/retaining top talent]
only [top-notch legal work]

[JusticeSquee]

cartoon-dog meme:

give [top-notch legal work]!
no [paying your associates with whatever structure you find effective for getting/retaining top talent]
only [top-notch legal work]

https://imgflip.com/i/42sh6w

[nealric]

When you're doing a $400m debt issuance you might as well drop an extra $100k on legal fees if it means getting the best representation and potentially heading off issues down the road. The MAE stuff arising from the pandemic vindicates this risk aversion because it turns out there really are some billion-dollar commas from time to time.

And the bank probably charging fees in excess of $1MM on that debt offering. So does it really make much sense to take a risk on an unknown firm to save $50k? Because if there’s a problem with the firm’s work, it will fall on your head, but nobody is going to care that you saved a few grand if there isn’t.

One dirty secret to those 5% annual fee raises is that discounts are often given out like candy. Fixed fees are all over the place, which often bring the effective billing rates way down.

[PMan99]

[quote]
The point is that large law firms, in lockstep, have been pushing through 5%+ annual rate increases for the last 10 years.

Do you every look at the bills that get sent out for M&A deals/cap market deals? Just ginormous monstrosities, with partners billing $1,500/hour, unqualified 1st years billing $450/hour, and senior associates close to the $1,000/hour mark.

That is a massive amount of money spent to basically have a bunch of liberal arts grads move commas around form documents, many times in an incredibly inefficient manner for relatively straightforward deals.

Any reasonable business is going to find these mounting legal fees increasingly painful, and naturally inquire why it costs so much darn money to do fairly straightforward work, and especially how it makes sense to pay $400+/hour for a first year associate who spent 3 years philosophizing in law school, but has little in the way of real tangible skills or an understanding of financial transactions.
[/quote]

The solution for companies that really use big firms enough for this to be a problem, and one increasingly adopted by large tech companies, is to bring more talent in-house. That way companies can get $1-2 million dollars worth of legal fees for $200-300k or whatever in total comp per attorney. If GCs insist on giving partners the profits instead of letting the corporation capture the excess itself, that's on the GC, not the firm for taking advantage of it.

[BrainsyK]

The solution for companies that really use big firms enough for this to be a problem, and one increasingly adopted by large tech companies, is to bring more talent in-house. That way companies can get $1-2 million dollars worth of legal fees for $200-300k or whatever in total comp per attorney. If GCs insist on giving partners the profits instead of letting the corporation capture the excess itself, that's on the GC, not the firm for taking advantage of it.

I'm not even sure that this is true. Given how many in-house attorneys post on here about working less than 8 hours a day, it seems like the corporation would just have to pay to keep these attorneys on-staff twiddling their thumbs a lot of the time. This is not to say that it's not overall less expensive, but it would certainly offset some of the fees that firms charge.

Also, you can only throw so many $200k salaries at firm folks with less growth at a slower pace and still have them take it. That really isn't that much in SF/SV/NYC. Not everyone is constantly looking to jump ship. Maybe if in-house positions started bumping up compensation, they could attract more people, but then that runs them into the exact same problem of higher costs.

[nealric]

The solution for companies that really use big firms enough for this to be a problem, and one increasingly adopted by large tech companies, is to bring more talent in-house. That way companies can get $1-2 million dollars worth of legal fees for $200-300k or whatever in total comp per attorney. If GCs insist on giving partners the profits instead of letting the corporation capture the excess itself, that's on the GC, not the firm for taking advantage of it.

I'm not even sure that this is true. Given how many in-house attorneys post on here about working less than 8 hours a day, it seems like the corporation would just have to pay to keep these attorneys on-staff twiddling their thumbs a lot of the time. This is not to say that it's not overall less expensive, but it would certainly offset some of the fees that firms charge.

Also, you can only throw so many $200k salaries at firm folks with less growth at a slower pace and still have them take it. That really isn't that much in SF/SV/NYC. Not everyone is constantly looking to jump ship. Maybe if in-house positions started bumping up compensation, they could attract more people, but then that runs them into the exact same problem of higher costs.

I think there is a pretty big trend towards that, but there are limits. My company does most deals below a certain size all in-house, and we generally have a philosophy of only using outside counsel when really necessary, but sometimes it just is for the following reasons:

1) Unless you are an absolutely enormous company (Apple/Exxon size), you can't have many subspecialists on staff. You might have a great tax lawyer on staff, but your tax lawyer may not have the experience necessary to draft a very technical partnership allocation provision if most of their day-to-day work is international tax.

2) For many reasons, it's rarely a good idea to attempt to litigate with in-house staff. For one, it's not realistic to have in-house staff experienced in every possible jurisdiction where the company may have to litigate. It would be a terrible idea to send a lawyer from an NYC corporate headquarters to argue before a jury in Louisiana over a chemical spill in a small town. Doesn't matter how good that lawyer is- they are unlikely to be well received.

3) Sometimes you need a disinterested perspective. If a counterparty to a deal you negotiated is threatening to sue over a provision, you are going to be mentally anchored to the interpretation of the language you had in your head when you worked on the deal. A third party is better assessed to evaluate the risk that it should be interpreted the other way.

One thing we've done a lot of is have in-house counsel do most of the work and just have outside counsel review. We might draft a memo and then send it out for comment rather than have a firm draft it. It retains outside perspective without the risk of dozens of research and comma hunting hours being spent. You can argue about hourly rates all you want, but the best way to save is to limit the scope of the engagement so there aren't excessive hours billed.

[ghostoftraynor]

It's insane that associate salaries have actually gone down in real terms and partner profits have gone up 16% during the same time, but associate salaries are the problem. Boomer in-house counsel really going to bat for boomer partners.

[veers]

I don't think they are going "to bat" for anyone. Companies are noticing their legal bills spiraling upwards, and out of control, and are trying to take steps to reduce them. When doing complex projects, they really do need 5% of the project to be done by the $1.5k/hour expert partner. What they don't need is to pay $500/hour for unqualified 1st year associates to produce initial drafts that go straight to the trash bin.

Therefore, quite reasonably, in house clients put pressure on firms to price associates according to their actual skills and contributions, which would be something on the order of $150/hour for a 1st year associate. The firms push back that given the high associate salaries, they have to price their associates at these crazy billing rates, or else the associates will be operating at a loss for the firm. As a result, in house clients have a direct interest in pushing to control associate salaries, as a mechanism of controlling their legal costs. Fundamentally, the partners may bill at higher rates but produce far more value to the clients than junior associates do, even when priced at 1/4 of the partner rates.

It's insane that associate salaries have actually gone down in real terms and partner profits have gone up 16% during the same time, but associate salaries are the problem. Boomer in-house counsel really going to bat for boomer partners.

[The Lsat Airbender]

Unless you are an absolutely enormous company (Apple/Exxon size), you can't have many subspecialists on staff. You might have a great tax lawyer on staff, but your tax lawyer may not have the experience necessary to draft a very technical partnership allocation provision if most of their day-to-day work is international tax.

This is the X factor. You need hundreds of lawyers to approximate the depth and breadth of a full-service law firm and north of a thousand do it nationally/globally. I know of F50 companies that have maybe a dozen plus another dozen support staff. Way more cost-effective to buy specialized legal services a la carte when you need them unless you have a huge, consistent pipeline of need for that service (e.g., FAANG and M&A/patent lit), and even then you only need to bring those people in-house.

The American economy sometimes feels like it's moving towards dominance by a handful of keiretsu-style megacorps, but until that actually happens we're going to have lots of independent law firms that charge as much as they can get away with. Which is a lot, when your clients are companies.

[Excellent117]

If we're really going to dream big, why don't we just stop tying compensation to billable hours? The billable hour has long outlived its usefulness anyway.

[nealric]

I don't think they are going "to bat" for anyone. Companies are noticing their legal bills spiraling upwards, and out of control, and are trying to take steps to reduce them. When doing complex projects, they really do need 5% of the project to be done by the $1.5k/hour expert partner. What they don't need is to pay $500/hour for unqualified 1st year associates to produce initial drafts that go straight to the trash bin.

Therefore, quite reasonably, in house clients put pressure on firms to price associates according to their actual skills and contributions, which would be something on the order of $150/hour for a 1st year associate. The firms push back that given the high associate salaries, they have to price their associates at these crazy billing rates, or else the associates will be operating at a loss for the firm. As a result, in house clients have a direct interest in pushing to control associate salaries, as a mechanism of controlling their legal costs. Fundamentally, the partners may bill at higher rates but produce far more value to the clients than junior associates do, even when priced at 1/4 of the partner rates.

In house counsel that attack associate billing rates are going after a red herring. You don't get that $1,500 an hour partner unless the $500 an hour first year comes along for the ride. I will admit I roll my eyes when a partner announces an associate I've never heard of on a call, but I accept that that the they are simply a way to charge $2,000 an hour for a partner. Legal services are one of the few services where each individual contributor is a line-item on the bill. This leads to a fixation on the bill's components rather than the engagement as a whole. Contrast again to investment banks that charge a success fee for a transaction. The effective hourly rate is well north of what most law firms charge, and most of the mundane work is likewise offloaded to junior folks- it's just that you don't see them on a bill.

If clients forced firms to charge $150 for a first year instead of $500, you'd see the partners charge even more to compensate, or they'd throw even more associate time at every matter (or both). Ultimately, arguing about associate billing rates is just arguing about how to slice the sausage. You aren't going to change the length. If in-house counsel want to control costs, the only way to do is to negotiate hard on the front end (fixed fee arrangements, etc.) or restrict the scope of the engagement.

[Anonymous User]

I don't think they are going "to bat" for anyone. Companies are noticing their legal bills spiraling upwards, and out of control, and are trying to take steps to reduce them. When doing complex projects, they really do need 5% of the project to be done by the $1.5k/hour expert partner. What they don't need is to pay $500/hour for unqualified 1st year associates to produce initial drafts that go straight to the trash bin.

Therefore, quite reasonably, in house clients put pressure on firms to price associates according to their actual skills and contributions, which would be something on the order of $150/hour for a 1st year associate. The firms push back that given the high associate salaries, they have to price their associates at these crazy billing rates, or else the associates will be operating at a loss for the firm. As a result, in house clients have a direct interest in pushing to control associate salaries, as a mechanism of controlling their legal costs. Fundamentally, the partners may bill at higher rates but produce far more value to the clients than junior associates do, even when priced at 1/4 of the partner rates.

It's insane that associate salaries have actually gone down in real terms and partner profits have gone up 16% during the same time, but associate salaries are the problem. Boomer in-house counsel really going to bat for boomer partners.

Makes sense. After all, the $500/hour directly goes to the associates' pocket If a junior's work is crap, the consequence should be lower PPP and not lower associates' salaries. Moreover, from my experience, really useless associates do get pushed out, maybe not after 3 months but after 1-2 years.

I also doubt that all biglaw partners "produce far more value to the clients than junior associates do". I have seen pretty crappy work from partners that required to be substantially revised by midlevel/senior associates. At the same time, I have seen quite useful work from juniors which only needed little revision.

[veers]

I think there are some differences between banker comp and lawyer comp:

1. Investment banks do exactly what clients would love for law firms to do - hire folks at $75k/year straight out of college to do the scut work. Contrast this with 1st year associates, who pull in ~$200k/year, and as far as the work product they produce, are often less qualified than 1st year analysts at GS. Since lawyers, as opposed to investment bankers, have convinced the world that they are part of some uniquely special "guild," they have effectively blocked the use of college grads, and forced through massive salary differentials for the lowest cost worker.

2. The role of bankers and of lawyers is quite different. The banker isn't just a service provider mindlessly drafting diligence memos - the bankers actually put the deal together, do road shows, pitches, client dinners, and are effectively part of the deal team of the client. It is a job that requires a large degree of social grace and sales skills, as opposed to the fundamental work of a biglaw attorney, which is just sitting by yourself in a dimly lit office grinding out documents. The nature of the work is radically different, and that is why clients so vigorously complain about legal fees, with nary a peep about how much their bankers are making.

If you asked clients what an ideal law firm would look like, I think they would strongly favor the European model, with junior associates being low paid "trainees," only graduating to higher salary levels once they have gotten a couple years of real work experience. This would seem to go a long way towards controlling legal costs, and more accurately reflect the real contribution of 1st/2nd year associates, in general.

I don't think they are going "to bat" for anyone. Companies are noticing their legal bills spiraling upwards, and out of control, and are trying to take steps to reduce them. When doing complex projects, they really do need 5% of the project to be done by the $1.5k/hour expert partner. What they don't need is to pay $500/hour for unqualified 1st year associates to produce initial drafts that go straight to the trash bin.

Therefore, quite reasonably, in house clients put pressure on firms to price associates according to their actual skills and contributions, which would be something on the order of $150/hour for a 1st year associate. The firms push back that given the high associate salaries, they have to price their associates at these crazy billing rates, or else the associates will be operating at a loss for the firm. As a result, in house clients have a direct interest in pushing to control associate salaries, as a mechanism of controlling their legal costs. Fundamentally, the partners may bill at higher rates but produce far more value to the clients than junior associates do, even when priced at 1/4 of the partner rates.

In house counsel that attack associate billing rates are going after a red herring. You don't get that $1,500 an hour partner unless the $500 an hour first year comes along for the ride. I will admit I roll my eyes when a partner announces an associate I've never heard of on a call, but I accept that that the they are simply a way to charge $2,000 an hour for a partner. Legal services are one of the few services where each individual contributor is a line-item on the bill. This leads to a fixation on the bill's components rather than the engagement as a whole. Contrast again to investment banks that charge a success fee for a transaction. The effective hourly rate is well north of what most law firms charge, and most of the mundane work is likewise offloaded to junior folks- it's just that you don't see them on a bill.

If clients forced firms to charge $150 for a first year instead of $500, you'd see the partners charge even more to compensate, or they'd throw even more associate time at every matter (or both). Ultimately, arguing about associate billing rates is just arguing about how to slice the sausage. You aren't going to change the length. If in-house counsel want to control costs, the only way to do is to negotiate hard on the front end (fixed fee arrangements, etc.) or restrict the scope of the engagement.

[ghostoftraynor]

I don't think they are going "to bat" for anyone. Companies are noticing their legal bills spiraling upwards, and out of control, and are trying to take steps to reduce them. When doing complex projects, they really do need 5% of the project to be done by the $1.5k/hour expert partner. What they don't need is to pay $500/hour for unqualified 1st year associates to produce initial drafts that go straight to the trash bin.

Therefore, quite reasonably, in house clients put pressure on firms to price associates according to their actual skills and contributions, which would be something on the order of $150/hour for a 1st year associate. The firms push back that given the high associate salaries, they have to price their associates at these crazy billing rates, or else the associates will be operating at a loss for the firm. As a result, in house clients have a direct interest in pushing to control associate salaries, as a mechanism of controlling their legal costs. Fundamentally, the partners may bill at higher rates but produce far more value to the clients than junior associates do, even when priced at 1/4 of the partner rates.

It's insane that associate salaries have actually gone down in real terms and partner profits have gone up 16% during the same time, but associate salaries are the problem. Boomer in-house counsel really going to bat for boomer partners.

In addition to what others have said, there isn't really a strong correlation to associate billing rates. First, all top firms pay the same salaries, but top top firms charge their associates out at significantly higher rates. Second, firms have consistently raised billing rates year over year, associate salaries do not go up year over year. And, as pointed out earlier, associate salaries have been stagnant at best in real terms.

Associate salaries are not what is driving billing rates. Firms will charge whatever they can get away with. As long as enough clients think the firms are worth the premium, they will keep raising. If firms could get away with paying less, they aren't going to pass that off to the client. The partners are just going to make even higher profits.

[nealric]

I think there are some differences between banker comp and lawyer comp:

1. Investment banks do exactly what clients would love for law firms to do - hire folks at $75k/year straight out of college to do the scut work. Contrast this with 1st year associates, who pull in ~$200k/year, and as far as the work product they produce, are often less qualified than 1st year analysts at GS. Since lawyers, as opposed to investment bankers, have convinced the world that they are part of some uniquely special "guild," they have effectively blocked the use of college grads, and forced through massive salary differentials for the lowest cost worker.

2. The role of bankers and of lawyers is quite different. The banker isn't just a service provider mindlessly drafting diligence memos - the bankers actually put the deal together, do road shows, pitches, client dinners, and are effectively part of the deal team of the client. It is a job that requires a large degree of social grace and sales skills, as opposed to the fundamental work of a biglaw attorney, which is just sitting by yourself in a dimly lit office grinding out documents. The nature of the work is radically different, and that is why clients so vigorously complain about legal fees, with nary a peep about how much their bankers are making.

If you asked clients what an ideal law firm would look like, I think they would strongly favor the European model, with junior associates being low paid "trainees," only graduating to higher salary levels once they have gotten a couple years of real work experience. This would seem to go a long way towards controlling legal costs, and more accurately reflect the real contribution of 1st/2nd year associates, in general.

I don't think they are going "to bat" for anyone. Companies are noticing their legal bills spiraling upwards, and out of control, and are trying to take steps to reduce them. When doing complex projects, they really do need 5% of the project to be done by the $1.5k/hour expert partner. What they don't need is to pay $500/hour for unqualified 1st year associates to produce initial drafts that go straight to the trash bin.

Therefore, quite reasonably, in house clients put pressure on firms to price associates according to their actual skills and contributions, which would be something on the order of $150/hour for a 1st year associate. The firms push back that given the high associate salaries, they have to price their associates at these crazy billing rates, or else the associates will be operating at a loss for the firm. As a result, in house clients have a direct interest in pushing to control associate salaries, as a mechanism of controlling their legal costs. Fundamentally, the partners may bill at higher rates but produce far more value to the clients than junior associates do, even when priced at 1/4 of the partner rates.

In house counsel that attack associate billing rates are going after a red herring. You don't get that $1,500 an hour partner unless the $500 an hour first year comes along for the ride. I will admit I roll my eyes when a partner announces an associate I've never heard of on a call, but I accept that that the they are simply a way to charge $2,000 an hour for a partner. Legal services are one of the few services where each individual contributor is a line-item on the bill. This leads to a fixation on the bill's components rather than the engagement as a whole. Contrast again to investment banks that charge a success fee for a transaction. The effective hourly rate is well north of what most law firms charge, and most of the mundane work is likewise offloaded to junior folks- it's just that you don't see them on a bill.

If clients forced firms to charge $150 for a first year instead of $500, you'd see the partners charge even more to compensate, or they'd throw even more associate time at every matter (or both). Ultimately, arguing about associate billing rates is just arguing about how to slice the sausage. You aren't going to change the length. If in-house counsel want to control costs, the only way to do is to negotiate hard on the front end (fixed fee arrangements, etc.) or restrict the scope of the engagement.

Investment banks pay a lot more than $75k to analysts all in. A first year may make $85k with bonus of the same, so $170k. You are effectively paying almost as much for someone with less education and without guild protection. I've worked with plenty of investment banks. Their skillset is different, but it's not fundamentally more or less valuable.

I've worked with plenty of European law firms. Honestly, it makes no difference. I've worked with London firms that are excruciatingly expensive- partner billing rates there are often even higher than NY. Paris isn't much better. Eastern Europe is cheaper, but that's largely reflective of exchange rate benefits for non-Eurozone currencies and generally lower cost structures in middle income countries. At the end of the day, their model doesn't result in any cost savings to clients.

An ideal law firm to me is one that provides high quality work, reasonably quick turnaround, and charges a reasonable fee. If they can do that, I don't care how they achieve it.

[The Lsat Airbender]

1. Investment banks do exactly what clients would love for law firms to do - hire folks at $75k/year straight out of college to do the scut work. Contrast this with 1st year associates, who pull in ~$200k/year, and as far as the work product they produce, are often less qualified than 1st year analysts at GS. Since lawyers, as opposed to investment bankers, have convinced the world that they are part of some uniquely special "guild," they have effectively blocked the use of college grads, and forced through massive salary differentials for the lowest cost worker.

have you really not heard of support staff

[Dcc617]

The boomer takes in this thread a unreal. Seriously, blaming heavily indebted young associates for the issues in biglaw is so bad.

[Monochromatic Oeuvre]

I think there is a pretty big trend towards that, but there are limits. My company does most deals below a certain size all in-house, and we generally have a philosophy of only using outside counsel when really necessary, but sometimes it just is for the following reasons:

1) Unless you are an absolutely enormous company (Apple/Exxon size), you can't have many subspecialists on staff. You might have a great tax lawyer on staff, but your tax lawyer may not have the experience necessary to draft a very technical partnership allocation provision if most of their day-to-day work is international tax.

2) For many reasons, it's rarely a good idea to attempt to litigate with in-house staff. For one, it's not realistic to have in-house staff experienced in every possible jurisdiction where the company may have to litigate. It would be a terrible idea to send a lawyer from an NYC corporate headquarters to argue before a jury in Louisiana over a chemical spill in a small town. Doesn't matter how good that lawyer is- they are unlikely to be well received.

3) Sometimes you need a disinterested perspective. If a counterparty to a deal you negotiated is threatening to sue over a provision, you are going to be mentally anchored to the interpretation of the language you had in your head when you worked on the deal. A third party is better assessed to evaluate the risk that it should be interpreted the other way.

One thing we've done a lot of is have in-house counsel do most of the work and just have outside counsel review. We might draft a memo and then send it out for comment rather than have a firm draft it. It retains outside perspective without the risk of dozens of research and comma hunting hours being spent. You can argue about hourly rates all you want, but the best way to save is to limit the scope of the engagement so there aren't excessive hours billed.

I wrote a long post lost to tech failures with some overlap to this post that I don't feel like reproducing, so just a few things to add re: why firms can't just save money by bringing things in-house upthread:

1. The person you *really* want--the partner--is going to be seven figures to poach.
2. Even more expensive than the salaries for people you might like to poach is their pro rata overhead--rent, equipment, IT, support staff, etc. At firms this is regularly 1.5-2x average comp.
3. Large commercial transactions require large teams to move at the speed the client wants and handle fire drills, so you can't replace four lawyers billing 500 hours for Client X with one full-time in house person. In general, the Catch-22 is that the massive fees that prompt consideration of bringing work in-house are almost always for deals that require the scale and specialized expertise that it's uneconomical to have on payroll unless you're a megacorp who keeps hundreds of lawyers on staff. This is why in-house positions (a) tend towards generalists who do things that are routine and less time-sensitive with heavy advisory/oversight attributes and (b) heavily disfavor litigators.

The point of this stuff, in the context of this thread, is to highlight the significant structural advantage that outside counsel provides in showing that Biglaw isn't going anywhere, and is probably not going to face any serious pressure to change its business model.

[nealric]

1. The person you *really* want--the partner--is going to be seven figures to poach.

My company actually did hire a partner in a speciality area once. They gave him a grand pooh-bah title and I'm sure a salary to match. The arrangement didn't last long. Both he and the company realized that the company wasn't getting their money's worth- there just wasn't enough workflow that needed his level of expertise. He eventually went back to his firm and we continued to work with him as outside counsel. The billings were a decent bit less than we were paying him beforehand.

Good point on sheer manpower. You'd need a lot of folks twiddling their thumbs most of the time for a company to be in a position to handle a major transaction solo.

[Anonymous User]

My take on this, based on my experience working with a lot of different in-house counsel at my firm, is that in-house counsel often don't realize how little actual legal work most partners do. In-house counsel think that partners are actually making the deck, drafting the brief, writing the memo, etc. and therefore think that everyone else billing time is superfluous bill-padding. But partners aren't doing that. At best, they are reviewing the work done by others, often at a 10:1 ratio, or higher, in terms of associate time: partner time.

It's enormously time-consuming just to make a 40-slide deck or a 20-page brief and have it be good and presentable to a client or court. Hours and hours of research, formatting, back-and-forth over edits, etc. Very little of that time is spent by the partner.

[LBJ's Hair]

My take on this, based on my experience working with a lot of different in-house counsel at my firm, is that in-house counsel often don't realize how little actual legal work most partners do. In-house counsel think that partners are actually making the deck, drafting the brief, writing the memo, etc. and therefore think that everyone else billing time is superfluous bill-padding. But partners aren't doing that. At best, they are reviewing the work done by others, often at a 10:1 ratio, or higher, in terms of associate time: partner time.

It's enormously time-consuming just to make a 40-slide deck or a 20-page brief and have it be good and presentable to a client or court. Hours and hours of research, formatting, back-and-forth over edits, etc. Very little of that time is spent by the partner.

Maybe inexperienced in-house lawyers, but anyone who's worked in BigLaw knows how the sausage is made. They also like, can see hours discrepancy in the bill?

[nealric]

My take on this, based on my experience working with a lot of different in-house counsel at my firm, is that in-house counsel often don't realize how little actual legal work most partners do. In-house counsel think that partners are actually making the deck, drafting the brief, writing the memo, etc. and therefore think that everyone else billing time is superfluous bill-padding. But partners aren't doing that. At best, they are reviewing the work done by others, often at a 10:1 ratio, or higher, in terms of associate time: partner time.

It's enormously time-consuming just to make a 40-slide deck or a 20-page brief and have it be good and presentable to a client or court. Hours and hours of research, formatting, back-and-forth over edits, etc. Very little of that time is spent by the partner.

I don't think any competent in-house counsel thinks partners are drafting slide decks or first cuts of briefs (nor do they want partners to do such work). They may ACT like they are, in part because it is the partner's responsibility to make sure it is done well and on time.

[Anonymous User]

Just chiming in as a midlevel to point out that once I was on a public company debt offering and the freaking GC not only requested that the partner do diligence, but in fact required that it be the partner (it was on-site, and he said he didn't trust an associate to do it). The partner literally had to fly somewhere to look at like 3 binders of board minutes and then fly home. The client then complained about the diligence cost on the final bill and managed to get the bill slashed. The partner complained about that one experience for like, a year, any time anyone at the firm said the word "diligence" within ear shot of him.

[yost]

Just chiming in as a midlevel to point out that once I was on a public company debt offering and the freaking GC not only requested that the partner do diligence, but in fact required that it be the partner (it was on-site, and he said he didn't trust an associate to do it). The partner literally had to fly somewhere to look at like 3 binders of board minutes and then fly home. The client then complained about the diligence cost on the final bill and managed to get the bill slashed. The partner complained about that one experience for like, a year, any time anyone at the firm said the word "diligence" within ear shot of him.

I mean, that is pretty absurd.

[jarofsoup]

There is an argument that using a boutique where able saves money.

The lower rates kind of cancel out inefficiencies. The partners make more money sometimes because overhead is wry low.