In an article by Sarah Moses, State Attorney General Eric T. Schneiderman recently issued a cease-and-desist letter to Derek Distenfield and his business, Legal Docs By Me, LLC, for the unauthorized practice of law.
Distenfield recently launched Legal Docs By Me, LLC, in Watertown, to “provide another key to the courthouse,” and he has announced plans to open in Syracuse, and near military bases nationwide.
According to his LinkedIn profile, Distenfield previously served as the senior VP of sales and marketing for We The People, a similar business. Multiple lawsuits across the country found that company to have engaged in the unauthorized practice of law, and in some instances, that the business had materially prejudiced the interests of its clients and forged client signatures. Associates of Distenfield along with his father and step-mother were involved in that business, and are currently involved in this one as well.
Schneiderman said “It is critical that New Yorkers receive strong legal advice from knowledgeable and qualified attorneys. My office will take whatever steps are necessary to ensure that anyone engaged in the unauthorized practice of law in New York State is stopped before consumer harm ensues.”
Opponents are already crying foul, with the usual complaints and attacks against us as attorneys.
Sometimes doesn’t it feel like we’re getting attacked from all sides?
In an article today by Chris Mondics of the Philadelphia Inquirer, he refers to the survey performed by Altman Weil of managing partners at more than 300 U.S. law firms with 50 or more lawyers. They conducted interviews this spring, and law firms told them that clients are driving the need for cost-cutting, there is a concerted move away from hourly billing to non-traditional charges, such as flat rates and contingency fees, and that cost-cutting has become mandatory.
So what? We already know that it’s a tough market. Legal spending has been relatively pathetic, even as pay for firms’ top lawyers remains very high, and for many firms the path to profitability has been through cost-cutting, not adding business.
The real surprise here is the reflection of a dramatic attitudinal shift among law firm leadership regarding client price pressure. Over 90% of respondents said they expected ongoing client pushback regarding billing, a number that is more than twice that of the survey conducted 5 years ago.
Eric Seeger, an Altman Weil analyst said:
“In the face of discounted rates, more work being taken in-house, and the unwillingness of clients to pay high fees for perceived low-value work, something has to give. It is going to be harder to sustain year-over-year profitability gains, the way we had been seeing for so many years.
The survey also showed that firms with 1,000 or more lawyers, have been much more aggressive in establishing new business practices, such as alternative-pricing structures, and at least two big firms in Philadelphia – Morgan, Lewis & Bockius L.L.P. and Reed Smith – are moving ahead with these pricing strategies. Another change is the addition of non-lawyer “pricing-managers.” now being utilized by hundreds of law firms around the country to help firms move away from charging clients by the hour.
Is the billable hour finally facing it’s demise?
So the alarmists amongst us will cry the sky is falling, while the cold, hard business management types will argue that increasing efficiencies and decreasing expenses is a sure way to increase profits. As is often the case, the truth is probably somewhere in the middle. Michael D. Torpey, the firm’s managing partner, sent out a firm-wide email to announce a voluntary early retirement program for U.S. secretarial staff. Thirty-seven secretaries are eligible for this buyout, which was offered to those who have “10 or more years of service to the firm and will be at least 59 ½ years of age in 2014.”
Here’s an explanation of the buyout program, from Torpey’s email:
I wanted to make all of you aware of the program and our reasons for offering it. As you know, a year ago we reviewed our support staff structure and took steps that are generating both significant service improvements and cost savings. We did not look at our secretarial staffing at that time. We already have secretarial staffing ratios that are in line with our peer firms. With the use of our very successful secretarial service centers, the ARC at the GOC, and other new ways of working, we have now identified opportunities for further improvement, which we can achieve through this entirely voluntary program.
Reduction of administrative staff is not in itself an overwhelmingly large area of concern, but it does beg the question of who may be next, and when.