The current issue of the ABA Journal (July 2007) has an article recapping the debate on the likelihood and advisability of publicly-traded law firms in the United States. Some of the more notable positions on the topic are:
- “It’s hard to say anything is inevitable, but throughout the history of the law, the rules have changed when economic pressure is applied,” says Ronald Rotunda, a law professor at George Mason University.
- “I know I wouldn’t invest in a law firm. I think it’s so dependent on the quality of partners that it would be a risky investment,” says Robert E. Wilson, managing partner with 450-lawyer Haynes and Boone in Dallas. “But I think it could be great for the profession, bringing a more entrepreneurial attitude.”
- “Our tradition is so opposed to [nonlawyer ownership] that it’s hard to see,” says William Hodes, professor of law emeritus at Indiana University and a solo practitioner in Indianapolis. “All our rules are against it.”
- “You couldn’t have more incentive to maximize profits than you do now,” says Bruce MacEwen, a former corporate and securities attorney in New York City and publisher of the Web log Adam Smith, Esq.
“If you were a publicly held law firm, the stupidest thing you could do would be to put other interests ahead of your clients, because without your clients, you’ve got nothing,” MacEwen says. […]
“I think if the rule [against equity law firms] ever had any validity, it’s been overtaken by events,” MacEwen says. “We have perfectly adequate rules against conflict of interest, fraud and malpractice.”
Here’s the entire article—and your bonus for taking a look is seeing me in the courtyard of our 1903 building.
Update: Tues 11 July, 3:55 pm
I received this email with the reader’s permission to append it to this article
"It seems odd to me that in the modern world lawyers should be so restricted in the way they can structure their business. The increasing move to LLPs suggests that many want some of the additional security of a more corporate style of ownership. In addition to an infusion of cash I wonder if the large law firm would benefit in other ways from becoming public companies. The change of status would mean that some aspects of their business would become more transparent. The lastest survey from The BTI Consulting Group, Inc. reiterates the age old complaints about law firms’ poor communication, lack of urgency etc as perceived by corporate clients. According to the survey only 32 percent of executives would recommend their outside counsel to others. Perhaps if senior partners became directors of public companies the greater transparency would make handling these perceptions a higher priority. "
—from Dorothea Stuart of Stuart Associates Ltd. in London, whose website describes her as "an executive coach, personal brand strategist, and Human Resources & Business consultant for lawyers."
Thanks, Dorothea. The issue of greater transparency is indeed a highly salient one, with potential repercussions we are only beginning to explore.
