Volume 126, 2014 • $6.95
RISING STAR OF THE MONTH
Selling a Law Firm: More Than Inconsequential Consequences
Good Lawyers Talk Money with Clients & Billing Is Marketing
Sally J. Schmidt Searching for Law Firm Website Search Traffic
Gyi Tsakalakis Defining Partner Obligations – The Rules Have Changed
Joel A. Rose
Attorney of the Month
David Peters TACKLING THE TICKING PIPE BOMB
How to Look Like An Expert
Make the Timekeeping Honor Roll
McIntyre’s California Alert
Frederick J. Esposito
Monty A. McIntyre
TABLE OF CONTENTS features 6 Selling a Law Firm: More Than Inconsequential Consequences by Ed Poll
8 Searching for Law Firm Website Search Traffic by Gyi Tsakalakis RISING STAR OF THE MONTH
10 Timothy Hutter
by Jennifer Hadley
EXECUTIVE PUBLISHER Brian Topor
EDITOR Nancy Deyo
ATTORNEY OF THE MONTH
16 David Peters
CREATIVE SERVICES Skidmutro Creative Partners
by Karen Gorden
22 McIntyre’s California Alert
CIRCULATION Angela Watson PHOTOGRAPHY Bronson Pate Vinit Satyavrata STAFF WRITERS Jennifer Hadley Bridget Brookman Karen Gorden CONTRIBUTING EDITORIALISTS Frederick J. Esposito Ed Poll Joel A. Rose Christopher Walton Mike O’Horo Gyi Tsakalakis Monty McIntyre Sally Schmidt David Lorenzo WEBMASTER Chase Jones ADVERTISING INQUIRIES info@AttorneyJournal.us SUBMIT AN ARTICLE Editorial@AttorneyJournal.us OFFICE 10601-G Tierrasanta Blvd., Suite 131 San Diego, CA 92124 P 858.505.0314 • F 858.524.5808 www.AttorneyJournal.us ADDRESS CHANGES Address corrections can be made via fax, email or postal mail.
Organized Succinct Summaries by Monty A. McIntyre
25 Make the Timekeeping Honor Roll by Frederick J. Esposito
26 Good Lawyers Talk Money with Their Clients & Billing Is Marketing Learn Some Actions Relating to Pricing, Fees and Billing that will Improve Your Relationships with Clients. by Sally J. Schmidt
28 Defining Partner Obligations – The Rules Have Changed by Joel A. Rose
30 How to Look Like an Expert by David Lorenzo
Editorial material appears in Attorney Journal as an informational service for readers. Article contents are the opinions of the authors and not necessarily those of Attorney Journal. Attorney Journal makes every effort to publish credible, responsible advertisements. Inclusion of product advertisements or announcements does not imply endorsement. Attorney Journal is a trademark of Sticky Media, LLC. Not affiliated with any other trade publication or association. Copyright 2014 by Sticky Media, LLC. All rights reserved. Contents may not be reproduced without written permission from Sticky Media, LLC. Printed in the USA
Litigation among lawyers for failing to honor an agreement to buy or sell a law practice is rare. However, in a recent matter, a solo lawyer thought he had reached such an agreement with his associate. Unfortunately, the lawyer did not live long enough to have the agreement commemorated to writing. A lawyer for the estate drafted the document after his death, but the document was never signed. The associate maintained that the document prepared by the lawyer for the estate had provisions never discussed with the decedent. The long-time associate sought to take advantage of his own relationship with clients and move the entire practice to another firm. The net result was a partnership position for the associate in the second firm, with no payment to the estate of the deceased lawyer.
Selling a Law Firm: More Than Inconsequential Consequences by Ed Poll
Ed Poll is the principal of LawBiz Management. He coaches lawyers to greater profits with less stress; he is the creator of the new Life After Law coaching program that enables lawyers to plan for a profitable exit. He can be reached at (800) 837-5880 and email@example.com.
The scenario raises several issues of major concern: • Can the estate retain control of the law practice for a reasonable period of time needed to sell the practice? If so, how should “reasonable” be defined? • While it’s clear that the estate’s representative cannot practice law without being licensed in the jurisdiction, can such a person control the business affairs of the practice, and direct the attorneys in the firm vis-a-vis the business? • Does the jurisdiction have an equivalent ABA Model Rule 1.17 allowing the sale of a law practice? If so, how does that impact the continuity of the practice? • Can an associate ingratiate him/herself with clients, at the expense of the firm, to the point that clients will transfer their matter to the associate; or must the associate maintain a neutral stance to allow the estate to offer a third-party lawyer/law firm the opportunity to have equal footing on behalf of and for the benefit of the estate in a sale or merger situation? What are the duties of loyalty and fair dealing involved with regard to: • The associate in relation to the firm and the estate of the deceased sole practitioner? • The law firm that gets the benefit and advantage of the deceased lawyer’s law practice?
The Estate Representative With regard to questions 1 and 2, without offering a definitive answer, it is clear that a representative of the estate has a role. Certainly it is best for a lawyer to have planned beforehand to select a practice representative if he/she dies unexpectedly. The ABA’s Commentary 5 on Rule of Professional Conduct 1.3 (“Diligence”) states: “To prevent neglect of client matters in the event of a sole practitioner’s death or disability, the duty
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of diligence may require that each sole practitioner prepare a plan, in conformity with applicable rules, that designates another competent lawyer to review client files, notify each client of the lawyer’s death or disability, and determine whether there is a need for immediate protective action.” In many states, a practice closed due to an attorney’s death or incapacity without a previously designated lawyer to handle the details must be wound up by a personal representative, guardian or conservator. For cases or matters not completely closed, the state bar can intervene, assume responsibility for action—and seek reimbursement and compensation from the lawyer’s estate or assets. Courts have even ruled that an estate can be directly liable to pay damages to injured clients left in the lurch by a lawyer’s death. The lawyer should have known that death was possible and taken steps to protect his clients in the event that tragedy struck. Such instances suggest that an estate representative can play a direct role in practice windup, with that role most likely being defined by the courts in resolving the matter.
The Impact of Rule 1.17 The reference to ABA Rule 1.17 in question 3 is significant because the intent of the rule is to permit the sale of all or a part of a practice. Most states now allow this (at least as the rule was originally formatted for the sale of the entire practice). This provision could directly impact the situation here. The associate in question could have, under Rule 1.17, explored purchasing all or part of the practice from the estate and moved it to his next firm. There could have been an extended escrow to mitigate concerns by all concerned, the estate, the associate and even the clients, that all the clients would be protected and well-served.
The Practice Transition Question 4 is perhaps best addressed by looking at what the older lawyer in the firm should have done to prepare the associate’s future role. In a small firm, it is essential to ensure that the client transition process to a successor is not only planned, but noncompetitive. The goal is to maintain and nurture the client relationship, allaying any fears of service gaps or other issues that will jeopardize the quality of legal counsel that the client has received and has a right to expect in the future. The successor must be willing to be part of this process, which should be carried out according to a wellconsidered and thoroughly researched strategy. Essential to that strategy is for the successor to attain, with the guidance of the senior lawyer, mastery of all specifics about existing client relationships as preparation for introducing the successor to those clients. There should be an accountability plan and a written timeline for all the discrete elements of the client transfer. This plan should be accepted by the senior lawyer and successor before meeting with each client, so it can be presented as a transition framework that the client can seek
to modify. The goal is to avoid mismatches in personalities, perceptions or understanding of what is to happen. Clients should be assured that a mutual effort will be made to continue meeting their needs, one in which all sides will continue to regularly evaluate how well the transition plan is working and to make adjustments as needed. That all this did not occur with the practice in question is the best explanation of why the associate felt justified acting as a free agent.
The Duty of Loyalty With regard to the associate’s duty of loyalty as raised in question 5, if the practice was insured, the estate representative should have raised the issue of whether the associate’s conduct was covered by the policy. It is of course likely that this conduct would be more than negligent, bordering on intentional, and therefore not covered. It is possible, however, that a carrier might be willing to offer something to aid a settlement to avoid further litigation. These and other ethical issues are not to be discounted in the context that roguery ultimately will be punished. The associate’s conduct was more than just a breach of conduct, more than just a breach of etiquette. It was not equitable, not fair, and a court should be the judge of whether a duty of loyalty was breached. The duty of the law firm that hired the associate should also be open to court review. A useful precedent can be found in the now frequent occurrence of lawyers’ leaving a firm and taking their clients with them. When a failing firm needs to come up with cash, the firm (or trustee in receivership) can make a very plausible argument that billables that walked out the door with its former lawyers belong to the originating firm itself. Deciding who gets the benefit from departing lawyers’ receivables is already being fought in the courts. The reality of our world is that anyone can sue anyone else, even if wrong. In the meantime, the largest pool of cash available to the trustee in bankruptcy for a defunct firm is the new firm that the defunct firm’s lawyers went to—and, perhaps, those individual lawyers themselves. Whether legitimately or not, new firms have been economically compelled to settle many of such claims in order to go on with the new firm business for the lawyers they added. Such could be the case with the associate here.
Afterward This article raises many questions, and the answers suggested are not completely definitive. One question, however, can be answered with great assurance. The lawyer who has not taken the possibility of his or her untimely death or disability into account when planning a practice’s future is playing with fire. Failure to plan for how clients will be taken care of in the event of death equates to reckless disregard for client welfare — a true ethical violation. It is obviously too late to wait until death or disability to let unprepared successors deal with an impossible situation. n
Attorney Journal | Volume 126, 2014
LAW FIRM WEBSITE SEARCH TRAFFIC by Gyi Tsakalakis
n the quest to drive traffic to their law firm website, many regard search traffic as the Holy Grail. While both direct traffic and referral traffic can be highly valuable to business development efforts, there can be little question that, in terms of volume, search traffic reigns supreme. But not all search traffic will have value to your practice. You have to drive meaningful search traffic — the kind that leads to an intended business goal. Here are some thoughts on how to do it.
Audience Before we get into the gory details about how search engines work, it’s critical to spend time thinking about the people whose attention you are trying to earn. Who are the people you are trying to attract to your website, and what are they looking for online? If you don’t understand your target audience, you’re going to have a very difficult time earning meaningful traffic from search engines. Do the research to learn about both the demographics and psychographics of your target audience. Create audience personas (profiles of the people you want to attract). Don’t limit your audience solely to people who are good candidates to become your clients. Think about all of the other people who might be interested in your subject matter: • Bloggers • Journalists • Colleagues • Activists • Industry leaders • Students • Professors Spend some time thinking about what makes these people tick. What are they passionate about? What are they writing about? Where do they go to do research? What language do they use? How do they use search engines? Don’t guess. Get out there and talk to people. Listen to their questions. Ask them questions and listen to their answers. Read what they’re writing. 8
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Once you’ve created your target audience personas, begin to brainstorm what you might create to interest them and supply their demand for information. What can you create that is uniquely valuable? What can you do online that doesn’t appear anywhere else? What do you know that many other people don’t?
Organic Search Traffic Organic search traffic comes from people who click on organic search listings. Organic search listings are those search results that appear because of their relevance and popularity. In other words, they’re the results that search engines deliver based on their algorithms. You can’t pay search engines for visibility within these results. To drive organic search traffic, your pages have to appear prominently in organic search results for which there is search volume. To make this happen, your pages have to be crawled, indexed, ranked and clicked. Crawled and indexed. Search engines use programs (called robots or spiders) to discover and scan websites. So, one of the first steps in appearing in organic search results is getting your pages “crawled” by search engine spiders. Once your pages have been crawled, they get processed and indexed. Think of the crawling and indexing like a giant Internet vacuum and filing system for web pages. To appear in organic search results, your pages have to be collected and understood by search engines. The more information your pages communicate to search engines, the better they can understand and rank your pages. Communicating what your pages are about is a huge piece of the technical SEO puzzle. Rand Fishkin’s Visual Guide to Keyword Targeting and On-Page Optimization is a very useful guide to the major elements of an optimized page. The technical aspects of driving organic search traffic should be the foundation of your online marketing. However, while essential, by themselves, they are often not sufficient. This is especially true in a highly competitive search landscape.
Ranked. Once you’ve optimized your pages for getting crawled and indexed, the next step is to improve your pages’ visibility within search results. In other words, getting your pages ranked for search queries that have meaning to your business. When someone performs a search, search engines aim to deliver results that they believe will provide the best experience to their users. Providing the “best experience” involves a variety of factors. Some of these factors include signals propagated by your pages, or “on-page factors.” These include things like keyword usage in your page titles, page load speed and internal links. However, search engines also use a variety of signals from other places. These factors are commonly referred to as “off-page factors” — things like the quality and quantity of links pointing to your web pages from other web pages around the web. While search engines use many factors to rank pages, link signals remain among the most significant. Think of links pointing to your web pages from other pages like votes by those pages for your pages. But know that, in the link-vote election, not all votes are counted equally: Votes from relevant and authoritative pages and sites are weighted much more heavily than votes from irrelevant or spammy pages. To increase your pages’ visibility with search results, you have to earn quality link-votes. The strategies for earning links are nearly limitless. A big part of the process includes creating and marketing “stuff” that people want to share and link to. Jon Cooper has a very useful link-building strategies list. Lawyers who are interested in earning links should start by identifying people who control other websites that are both topically relevant and authoritative. These might include people at: • Professional organizations and associations • Legitimate legal directories • Local educational institutions (high schools, universities, law schools) • Local news sites • Other lawyers • Legal bloggers • Other relevant business websites Once you’ve identified authoritative and relevant sites from which you want to earn a link, the next step is to come up with strategies for obtaining the links from these folks. WARNING: Don’t make people angry. As you probably know from personal experience, people get bombarded with spammy “link requests” almost every single day. Sending unsolicited emails to strangers requesting links is not a good strategy. However, offering to sponsor an organization’s event might earn you a link. Accepting an invitation to be interviewed by a local reporter might earn you a link. Offering a scholarship might earn you a link. And yes, creating “stuff” on your site that stands on its own merit as “link-worthy” can earn you links. Clicked. Visibility within search results is not a business goal. To be meaningful in terms of generating client fees, you still have to motivate people to click through to your pages, contact you, hire you and pay you. Motivating the right people to click through to your pages from search results can be complex. Aside from your position on a search results page, you really have three tools in your arsenal to influence clicks: • Page titles • Meta descriptions • Rich snippets Your page titles (the words that live between <title> and </title>) are what most search engines use to generate the “blue links” in search results. Your titles should describe the content of your pages, as well as compel people to click on them. This is why it’s so important to understand who your audience members are, what they’re looking for and how they use search engines. Continued on page 24
Attorney Journal | Volume 126, 2014
FEATURED RISING STAR
OF THE MONTH
No Place Like Home Rising Star Timothy Hutter’s Career Comes Full Circle in His Hometown Community.
by Jennifer Hadley
had a fairly normal and fortunate childhood as a Navy brat whose family moved all over the place. My dad served on submarines based out of San Diego for two tours when I was a child. I went to high school locally,” says Tim Hutter, an Associate in Allen Matkins’ Litigation Group. “I was your prototypical kid who got involved with debate in high school, found out that I could weave a nice logical argument together and end up convincing someone to vote my way,” he adds. Setting a course for a major in Political Science, Hutter would once again be on the move, moving to the East Coast for his undergraduate studies at Yale. While he was used to by Joel A. Rose moving, being so far away from his family wasn’t ideal. “My parents were very hardworking, and emphasized integrity and family above everything else.” As such, when it came time for law school, Hutter headed back to the West Coast to attend UCLA, citing proximity to family as his priority. Things seemed to be going Hutter’s way, as he excelled in law school. However, during his second year, his family was dealt a devastating blow. “My parents were among thousands who lost their homes in the Witch Creek/Guejito fires in October 2007. I took a week off from law school to help, both with the psychological coping and with the logistics of the situation. We sifted through the remains and tried to find items that might be salvageable, but most everything was lost, including photos and other keepsakes accumulated over the years. When the fire hit, I was in the final stages of deciding where to work as a summer associate. Though I had been considering offers in L.A. and Orange County; the loss my family experienced made it a no-brainer,” Hutter recalls.
Attorney Journal | Volume 126, 2014
“I chose to work at Luce Forward that summer, and loved my time there. I did work that spanned from a business IPO to real estate transactional work, employment litigation and real estate litigation,” Hutter says. He was eagerly looking forward to joining the firm’s Real Estate and Environmental Litigation group following graduation, when another unexpected disaster struck. “The bottom fell out of the real estate market, the stock market crashed, and in the span of a five minute phone call, I went from sitting in the comfortable position of having a job lined up after graduation to having no prospects in one of the worst hiring markets in years,” he says. Hutter saw that it was highly probable that his plans to remain close to his family and girlfriend (now wife) in his hometown of San Diego weren’t going to materialize. “I applied for jobs across the country without much luck. I even considered following in my father’s military footsteps by joining the Navy JAG Corps,” he says. However, a single phone call would change everything for him. “I had decided to set my job search aside and focus on studying for the bar exam. Less than a week into studying, I got a call out of the blue from Megan Mazza, who had helped run the summer program at Luce Forward. She and Val Hoy had left Luce Forward and come to Allen Matkins in March 2009,” he says. Hutter was offered an interview, and a position. “Allen Matkins even covered my bar expenses and paid me a stipend, which I was able to use to help my parents as they continued to rebuild. In the end, things came full circle and I ended up in San Diego with an excellent firm and a great group of people,” he says.
In the years since Hutter has returned home to San Diego, he’s found his stride with Allen Matkins. “I love the meat and potatoes aspect of law that I get to work in,” he says. As part of the firm’s litigation group, Hutter’s practice includes construction, real estate and landlord/tenant litigation, as well as business and shareholder derivative litigation. Though the bulk of his work is on the defense side, he has also had the opportunity to do plaintiffs’ work on behalf of commercial landlords, and he’s done a great deal of appellate work in his nearly five years with the firm. “I love researching the law. I love finding cases that illustrate the law, and making the connection of law to facts in a case. A lot of being a lawyer is playing the cards you’re dealt, and dealing with the situation your clients find themselves in. I love piecing together facts and law to form arguments,” he says. Not surprisingly, this passion for the law has been noticed and in 2012, he was named a Top Young Attorney by the San Diego Daily Transcript. Hutter’s legal skills are supported by a healthy competitive streak, and an innate ability to connect with and form relationships with others, both at work and in his spare time. As a member of Allen Matkins’ Community Outreach Committee, Hutter is incredibly active in community service and volunteers a great deal of his time to multiple organizations. “Our committee organizes quarterly projects or drives that encourage the folks in our office to come together and help the community. We’ve gathered books to send to troops overseas, won awards for participating in the Feeding America ‘Food from the Bar’ competition, and adopted families for the holidays,” he explains.
Moreover, “I spend a large amount of my free time working with high school students from my church,” he says. “I was involved in the ministry when I was in high school, and it remains very special to me,” he says. Hutter also conducts admissions interviews on behalf of the Yale Alumni Schools Committee and is active with the Building Industry Association, particularly the Young Generation of Leaders (yGen) group. As far as his professional future is concerned, Hutter has a solid plan. “My next five years will probably include a greater emphasis on attracting clients and developing business. I’ve already done a bit of that so far in my career, but there is plenty of room to grow. Plus, while I don’t think you can ever stop honing your skills and learning about the law, I’m starting to be more comfortable with the technical aspects of practicing law. I have my eye on partnership, and that will call for more leadership and client management,” he says. And of course, for Hutter, who grew up in a “strong nuclear family,” his focus on family remains firmly intact. “I try to spend as much time as I can with my wife Tara and our son Colton. We have another little one on the way this year, and we are excited about our growing family.” n Contact: Timothy M. Hutter Allen Matkins Leck Gamble Mallory & Natsis LLP 501 West Broadway, 15th Floor San Diego, CA 92101-3541 (619) 233-1155 (main) (619) 235-1510 (direct) www.allenmatkins.com
Attorney Journal | Volume 126, 2014
COMMUNITY news nChristopher C. Walton, principal of nFisher & Phillips LLP is pleased Walton Law APC, has been selected to announce that Brooke Tabshouri, to the 2014 Southern California an associate in the San Diego office, Super Lawyers list. No more than five has been selected for inclusion in percent of the lawyers in California San Diego Daily Transcript’s Young are selected by Super Lawyers, a Attorneys 2013. The annual list is Committed to Helping Victims of Elder Abuse rating service of outstanding lawyers determined by a peer voting process and Personal Injury Receive the Justice and Compensation They Deserve from more than 70 practice areas and identifies the top young attorneys who have• attained a high degree of in the San Diego legal community. Nursing Home Abuse and Neglect peer recognition and professional Tabshouri focuses her practice • Financial Elder Abuse BROOKE TABSHOURI achievement. on representing employers and • Personal Injury CHRISTOPHER C. WALTON Walton concentrates his practice management in a variety of aspects of Generous Referral Fees Paid Per State Bar Rules in the areas of personal injury and labor and employment law. These capacities include wrongful nursing home abuse/neglect. In addition to his advocacy on termination litigation, wage and hour violations, collective behalf of elderly and personal injury750 victims, Walton is actively and class action disputes, and employment discrimination and B Street, Suite 3300 | San Diego, CA 92101 | 619.233.0011 involved in the San Diego legal community. In 2011 and 2012, harassment. Walton was elected by his peers to serve as co-chair of the Elder Prior to joining Fisher & Phillips LLP in April 2012, Law Section of the San Diego County Bar Association. He is Tabshouri held a position as a post-graduate research attorney www.waltonlawapc .com also active in the North County Bar Association, Consumer for Hon. Richard D. Huffman of the California Court of Attorneys of San Diego, Consumer Attorneys of California and Appeal, Fourth District, Division One, in San Diego, Calif. the American Inns of Court, Honorable William B. Enright Chapter. nGayle M. Blatt, a partner with San Walton was also named a Top Attorney by the San Diego Diego-based CaseyGerry and head of Daily Transcript in 2013. its pharmaceutical and medical device practice group, has been appointed by nFish & Richardson is pleased U.S. District Judge Anthony Battaglia to announce that Kevin Kantharia to serve as co-liaison counsel for the has received the 2013 American growing number of incretin mimetic Intellectual Property Law Association products liability cases in multidistrict (AIPLA) Robert C. Watson Award litigation (MDL 2452) now pending for his paper “The Shrinking and in the Southern District of California. Unpredictable Law of Willful Patent As co-liaison counsel in the GAYLE M. BLATT Infringement: Why the Federal multidistrict litigation, Blatt will Circuit Should Revisit En Banc the be responsible for facilitating communications between the Issues in Bard Peripheral Vascular.” respective parties in the MDL and the court overseeing the KEVIN KANTHARIA This annual competition is litigation. Currently, there are over 150 cases pending in the designed to encourage interest in MDL involving incretin mimetic drugs used to treat Type 2 intellectual property issues and give law students further diabetes — Byetta, Januvia, Janumet and Victoza — and new experience with the concepts and realities of a career in cases are being filed at a rate of between 20 and 40 per month. intellectual property law. Students are encouraged to submit The incretin-based therapies products liability articles on a subject related to the protection of intellectual litigation MDL alleges that use of the drugs can cause property and judges consider the merit of the article as a pancreatic cancer. In August of this year, the U.S. Judicial Panel contribution to the knowledge of intellectual property and the on Multidistrict Litigation (JPML) consolidated all federally extent to which it displays original and creative thought. filed suits involving the diabetes drugs to the U.S. District Kantharia wrote the article during his third year in law Court for the Southern District of California. school at the University of San Diego Law School, where he earned his law degree. He joined Fish after graduation and was admitted to the California bar in December 2013. Kantharia was previously a participant in Fish’s Diversity Fellowship program in 2011 and worked as a summer associate for the firm while attending law school.
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Attorney Journal | Volume 126, 2014
Email it to PR@AttorneyJournal.us
COMMUNITY news nGomez Iagmin Trial Attorney Parisima Roshanzamir has been named the Regional Captain for San Diego of the Consumer Attorneys of California New Lawyers Division (NLD). The purpose of NLD is to stimulate the interest and commitment of New Lawyers in the objectives of CAOC, generate new members for CAOC, PARISIMA ROSHANZAMIR provide public services focusing on the preservation of the civil justice system, Trial By Jury and other civic-oriented projects, develop statewide professional relationships and assist members of CAOC in the early stages of their careers by ensuring that all CAOC components give appropriate attention to the needs of New Lawyers. Parisima’s goal for the year is to encourage San Diego’s new attorneys to connect, network, and build a stronger community. A unified trial bar grows and stands the test of time to fight for justice through the new lawyers of its next generation. The San Diego chapter of NLD, under Parisima’s guidance, plan to meet once a month, beginning on January 30 at Gomez Iagmin nHecht Solberg Robinson Goldberg & Bagley LLP (HechtSolberg) has once again been recognized as one of the top law firms specializing in real estate with a Tier I San Diego ranking in the annual U.S. News — Best Lawyers® ranking of Best Lawyers (2014). The firm, which is based in San Diego and serves MICKEY MAHER developers, investors, businesses and entrepreneurs throughout California, is rated among the year’s “Best Law Firms” after a rigorous evaluation process that included client and peer feedback. “We are a relationship-based firm where the success of our clients is our paramount focus,” said Mickey Maher, managing partner with HechtSolberg. “This drives our business philosophy of providing high value, practical business and real estate advice with excellent service to every client, every time. We are very pleased to be honored among the industry’s best in this prestigious ranking.” To be eligible to participate in the U.S. News — Best Lawyers ® review process, each law firm must have at least one attorney who has received high enough peer-review to be listed in the current edition of Best Lawyers. HechtSolberg has four attorneys who achieved this recognition: Paul Robinson, David Bagley, Darryl Solberg and Susan Daly.
nHickman & Robinson LLP is pleased to announce the addition of attorney Sasha Kamfiroozie as a partner of the firm. Kamfiroozie will join the Estate Planning and Probate Practice Group at Hickman & Robinson. Kamfiroozie was previously founder and principal of the Kam SASHA KAMFIROOZIE Law Firm. Her primary areas of practice are Estate Planning and Probate, focusing on Family Estates, High Net Worth Estates, Special Needs Planning, Probate, Conservatorships, and Small Business Planning. Kamfiroozie is a member of the Estate Planning, Trust and Probate Law Section of the San Diego County Bar Association, co-chair of the San Diego Lawyers Club Mentorship Committee, and co-chair of the California Western School of Law Alumni Board Continuing Education Committee. She volunteers with Legal Aid Society of San Diego. She was also nominated for the San Diego Daily Transcript’s Outstanding 2013 Young Attorneys. nSolomon Ward Seidenwurm & Smith, LLP is pleased to announce that it has added Amanda L. Harris as partner and Angela A. Woolard as an associate to the firm’s family law practice. Harris is certified as a Family Law Specialist by the State Bar of California. Her practice focuses AMANDA L. HARRIS exclusively on family law matters with an emphasis on complex, high net-worth marital dissolutions. Prior to joining Solomon Ward, Harris was a partner at Seltzer Caplan McMahon Vitek where she represented executives of Fortune 500 companies, business owners, professional athletes, and celebrities and their spouses in complex marital ANGELA A. WOOLARD dissolutions involving division of business interests, spousal support, child support and child custody matters. Woolard joins Solomon Ward as an associate. Her practice also focuses exclusively on family law matters, including assistance with dissolution of marriage proceedings and family law appeals, as well as the preparation and negotiation of prenuptial and marital settlement agreements. Prior to joining the firm, she was an associate at Seltzer Caplan McMahon Vitek, where she assisted clients with dissolution of marriage proceedings, including temporary and permanent child and spousal support orders, child custody and visitation and division of property. Attorney Journal | Volume 126, 2014
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Construction Defect Niche David M. Peters has created a name for himself by successfully pursuing Chinese Pipe Construction Defect Cases. by Karen Gorden
uccessful construction defect litigation is not an accident. It is about precision, skill and a willingness to devote the necessary time and resources to the case,” says David M. Peters, founding partner of Peters & Freedman, L.L.P. This is evidenced by the November 8, 2013 court-approved $21,500,000.00 partial settlement in Acqua Vista Homeowners Association v. K. Hovnanian at Acqua Vista, LLC, et al, case No. 37-2009-00104348, wherein he served as lead attorney for Acqua Vista. Through this case and other similar litigation, Peters has come to be regarded as a true virtuoso when it comes to San Diego construction defect cases involving Chinese pipe. According to Peters, poorly made cast iron waste and storm pipe imported from China represented the majority of the damages in the $21,500,000.00 dollar partial settlement. “Acqua Vista has an estimated 50,000 lineal feet of cast iron pipe, so the case is still ongoing against the pipe suppliers,” he explains. For Peters, who graduated from Pepperdine University before earning his Masters of Business Administration at UC Riverside and consequently his J.D. from Hastings School of Law, the decision to enter the highly specialized field of construction defect cases was born of a determination to carve a niche in the highly competitive field of law. Indeed, Peters saw the opportunity to distinguish himself by becoming the area’s leading expert in Chinese pipe disputes, and delved into the field with gusto. “Over the last several decades, China had become a significant supplier of less expensive building supplies,” Peters recalls. “However, I learned quickly that less expensive did not 16
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necessarily translate into savings in the long run. During the building boom from 2000-2008, most of the cast iron pipe in San Diego’s mid-rise and high-rise buildings was imported from China. Cast iron pipe is supposed to remove sewer and storm water from buildings, which is why it is primarily seen in the garage of a building. However, when that pipe is defective, it corrodes, and the smell emitted from leaking cast iron sewer pipe is absolutely unbearable,” he says. Even worse, Peters explains, “replacing defective pipe in a mid- or highrise development is nothing short of a herculean task, not to mention extraordinarily expensive.”
Proving The Value of Precision
It is precisely that cost that has driven so many firms to aggressively market to building owners, according to Peters. Yet, many of the firms simply do not have the skill set required to achieve sufficient recovery that Peters is determined to recover for his clients. “As attorneys, we have an obligation to put forth our full effort to fighting a case, whether it is profitable or not. Lawyers have been disbarred for taking on case after case and settling them for cents on the dollar, and never stepping foot in a courtroom,” Peters says. “I’ve been representing associations for more than 26 years, and I have seen far too many building owners settle for an insufficient recovery by what I call ‘blow and go’ attorneys. Chinese pipe defect cases require highly specialized skills in order to ensure that the building owners are fairly compensated.
OF THE MONTH
When attorneys take on these cases without the proper resolve, the result is that they often place building owners at even greater risk.” By contrast, Peters explains that his professional career has been in the field of construction defect litigation, and as such, he has served the building industry in multiple advisory roles. He served on the California Department of Real Estate Subdivision Advisory Committee Litigation Task Force. He is also a member of the Community Associations Institute where he served as a past Director and Committee Chairman. “Unfortunately, I’ve seen more and more firms implementing the ‘blow and go’ marketing strategy for profit in these types of cases. They are almost always handled on a contingency fee basis, where the attorney advances the expert fees and costs and thereafter controls the process. In order to sign up more clients, the ‘blow and go’ firms offer to charge less than other firms. Instead of charging, for example, 28% of the gross, they will offer to provide the contingency at 27% or less. What they fail to mention is the ‘less’ means ‘less’ for the client.” “For example, take a moderate sized construction defect case that is worth $6.6 million. A skilled attorney will do whatever is necessary to recover the full amount, and the association will receive more than $4 million, after expert and attorney fees. When these ‘blow and go’ firms offer to charge less, that means they are going to charge less to the responsible party, so they will often settle a case like this for $2.5 million. Sure, they may take 1% less than another firm, but the net result to the association winds up being roughly $1.3 million. It’s unfortunate because the attorneys’ fees are nearly identical, but the association loses out,” Peters explains. 18
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Setting Standards of Excellence in Skills
According to Peters, the second way he’s been able to earn his reputation as the “bulldog” of Chinese pipe construction defect cases lies in his ability to manage the experts involved in a case. “Managing the experts is absolutely a skill,” he says. “It requires the recognition that no attorney knows as much as the experts know. It also requires an understanding that there are only a few true experts for each discipline in the industry. Naturally, the true experts are extraordinarily busy. Out of necessity and especially early on in the case, these experts send subordinates who do not have near the expertise and insight as the retained person who will ultimately testify. But we have found a way to manage this,” says Peters. “The solution for Peters & Freedman, L.L.P. is to engage a building engineer as a consultant at the sole expense of Peters & Freedman, L.L.P. By retaining a qualified building engineer who has built high rises and routinely works with sophisticated mechanical systems to assist with the early identification and elimination of legitimate defects, the process is dramatically streamlined and becomes accurate early on,” Peters explains. Continuing, he adds, “When I first starting working in Chinese pipe construction defect cases, I expected backlash from the experts. I incorrectly thought that these experts loved the scenario in which they were set loose with no direction and could bill what they wanted. I was so wrong. What I learned is that the experts were effectively being compelled to do the attorney’s work and proceed with no direction. This process resulted in huge invoices which the client did not want
to pay and also served to diminish the quality of the experts’ performance. As one expert I worked with early on put it, ‘you are not a construction expert and I am not an attorney. I do not want to do your job because that creates a parade of horribles and ends up making me look bad,’” Peters recalls. What is clear to Peters is that the economic reality facing expert firms is that “they sometimes have no choice but to send out their “C” team with little direction. They know that their “C” team will catch only that which is obvious. They also know that when an attorney is not on top of their game, about halfway into the case, the plaintiff’s experts will eventually learn most of what is going on from the defense experts whose job it is to refute the plaintiff’s experts’ findings. This typically happens at one of the first few mediations. The experts then end up redoing, duplicating, revising and sometimes blatantly contradicting the opinions and cost estimates of their own “C” team,” he says. Moreover, according to Peters, “multiple experts have confided that if the plaintiff’s attorney spent the time to know the project and learn what the problems were before sending them out with no direction, the outcome for the clients would be significantly better.” Peters has also learned over his tenure in working with experts that another area wherein attorneys fail to properly manage them occurs when the attorney refuses to let the experts investigate all issues thoroughly. “Incredible as it may seem, an attorney who wants the case settled often does not want to be burdened with knowing that there are more defects. Such knowledge makes the case much longer and requires that attorney to spend 10 to 20 times the amount of time. The experts then find themselves writing CYAs back to the attorney
advising that they were thwarted from doing a complete investigation. The crazy thing is that this correspondence is discoverable to the defense who is then able to deduce that the plaintiff’s attorney can be compelled to settle very cheap. This is just wrong,” Peters says.
Devotion of Time & Resources
For Peters & Freedman, L.L.P., neither time nor resources are spared in an effort to obtain maximum recovery for its association clients. “Blow and go firms are easy to spot,” says Peters. “Find out how many cases a law firm is handling. If the firm has 10 attorneys yet has offices all over California, Nevada and/or Arizona with 80 ongoing cases, this is a big red flag,” he says. “Under that paradigm, assuming each attorney in a 10 attorney law firm works 50 hours a week or 2500 hours a year, this leaves a total possible amount of that firm’s attorney hours over that two year period of 50,000 attorney hours. Dividing 50,000 hours by 80 cases provides a maximum of 625 attorney hours that can be devoted to each case during any 2 year period. That is scary math! Most committed attorneys will spend 10 to 20 times the amount of attorney hours on a case to obtain the kind of recovery for the association that it deserves,” he adds. Similarly, Peters cautions against associations retaining attorneys promising quick settlements. “A common marketing gimmick for the ‘blow and go’ law firm is to promise to resolve the case faster than other firms. This is an error and a trap. If an association is going to embark on construction defect litigation, the association should be prepared to do it right or not do it at all. For example, the Attorney Journal | Volume 126, 2014
Peters & Freedman, LLP.
Partners and Associates
KEENAN A. PARKER Partner
JAMES R. MCCORMICK Partner
STEPHEN M. KIRKLAND Partner
LAURIE F. MASOTTO Associate
LAURIE S. POOLE Associate
JOHANNA R. DELEISSEGUES Associate
MICKEY JEW Associate
TRACY FULLER LINKOWSKI Associate
KYLE E. LAKIN Associate
ZACHARY R. SMITH Associate
LISA GETCHEL Paralegal
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CHRISTINA BAINE DEJARDIN Partner
Contact: David Peters Peters & Freedman, L.L.P. 760-436-3441 email@example.com www.hoalaw.com 191 Calle Magdalena, Ste. 220 Encinitas CA, 92024
Acqua Vista case took over 3 years and resulted in a far better recovery for the client. When all is said and done, it may be the largest construction defect case in San Diego’s history,” he adds. “Attorneys need to spend as much time on a case as it takes. It could take 2 years or it could take 4 years. The reality is that until there is the pressure of trial, most cases can only settle for a small fraction of what they are worth. In the Acqua Vista case, there were opportunities to settle the case for approximately $5,000,000.00 much earlier. But we kept pursuing the maximum recovery because our client deserved it.” For Peters, part of doing what is in the best interest of his clients occasionally means informing clients that he will not devote time and resources to cases that will not pan out favorably for the client; hence, he will not take the case. “While some associations and commercial buildings will and should eventually be in construction defect litigation, many should not. Construction defect litigation should not be automatic and is not inevitable. The problem is that ‘blow and go’ mass marketing attorneys rush to pursue construction defect cases, regardless of whether or not it is in the client’s best interest. The most common argument is that there may be a statute of limitations issue. Of course, there are some shorter statutes of limitations, but the truth is that often the defects which are subject to this shortened statute of limitations are small and inconsequential,” Peters says. In other instances, construction defect cases are not warranted because there simply is not enough information available at a given time. “Bringing a lawsuit too soon is very risky. For example, consider that there has been almost no rain in the last two years. It would be better to see how the roof, windows, foundations, and storm pipes perform after some weather. Actual leaks are a lot more persuasive than an expert claiming that any particular component will leak,” Peters says with a chuckle. As for the future of Peters & Freedman, L.L.P., Peters is adamant that his firm will stay the course in providing skill, precision and devotion to clients. “We are here as specialists, and we devote everything we have to every single case. We will never be in a position to try to represent 70-140 cases at the same time. It is unethical and unfair to our clients. Plus, I would rather be a chef who serves fine steaks and wine to a few, than to be known for ‘Billions & Billions served.’” n
» PERSONAL INFORMATION: • Accomplished Trial Attorney • Frequent Lecturer For Homeowners Associations • Frequent Publisher For Homeowners Associations • Volunteer Mentor • Short Story Writer • Black Belts In Martial Arts • Retired Rugby Referee For United States
» CURRENT MEMBERSHIPS: • Consumer Attorneys Of San Diego (CASM) • California Association of Community Managers (CACM) • Community Association Institute (CAI) • State Bar Of California • American Bar Association
McIntyre’s California Alert Organized Succinct Summaries By Monty A. McIntyre, Esq. Monty A. McIntyre follows his passions for the law and serving others by serving as a mediator, arbitrator and motion referee to help individuals, businesses and lawyers obtain rapid, reasonable resolution of disputes. He is also the Publisher of McIntyre’s California Civil Law Update and can be reached at 619-990-4312 or firstname.lastname@example.org.
CALIFORNIA COURTS OF APPEAL
Arbitration Anaheim Union High School District v. American Federation of State, County and Municipal Employees, Local 3112, AFL-CIO (2013) _ Cal. App.4th _ , 2013 WL 6909431: The Court of Appeal affirmed the trial court’s judgment confirming an arbitration award in favor of the American Federation of State, County and Municipal Employees, Local 3112, AFLCIO (the Union). Because the Anaheim Union High School District (District) had no statutory right under Education Code sections 45308 and 45117 to reduce a classified employee’s work year in lieu of a layoff for lack of funds — without complying with the collective bargaining agreement — the arbitrator did not exceed his powers in ruling that the District violated the collective bargaining agreement. (C.A. 4th, filed December 16, 2013, published January 3, 2014.)
Attorney Fees Cardinale v. Miller (2014) _ Cal.App.4th _, 2014 WL 68095: The Court of Appeal affirmed the trial court’s order granting attorney fees. California Code of Civil Procedure section 685.040 does not limit recovery of fees to only fees awarded against the original judgment debtor. Rather, it imposes two requirements before a motion for an award of postjudgment attorney fees may be awarded as costs: (1) the fees must have been incurred to ‘enforce’ a judgment; and (2) the underlying judgment had to include an award for attorney fees pursuant to Code of Civil Procedure section 1033.5, subdivision (a)(10)(A). While in the usual scheme of things, the target of a fee motion under section 685.040 is presumably the original judgment debtor, the Legislature did not so restrict the provision’s scope. The statute by its terms is broad enough to encompass fees expended to enforce a judgment against third parties who conspired with the judgment debtor to evade its enforcement.(C.A. 1st, January 8, 2014.)
Civil Procedure CertainTeed Corporation v. Superior Court (Hart) (2014) _ Cal.App.4th _ : The Court’s ability to allow additional time for depositions applies to both the seven hours of total testimony allowed in Code of Civil Procedure section 2025.290(a) and the 14 hours of testimony allowed in section 2025.290(b)(3). The trial court, however, retains the discretion to limit a deposition in the interests of justice. (C.A. 2nd, January 8,2014.) Market Lofts Community Association v. 9th Street Market Lofts, LLC (2014) _ Cal.App.4th _ , 2014 WL 47016: The Court of Appeal reversed the trial court’s order sustaining a demurrer without leave to amend. The trial court erred in finding the homeowners association lacked standing to assert claims against developers regarding parking rights. (C.A. 2nd, January 7, 2014.) 22
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Employment/Labor Anaheim Union High School District v. American Federation of State, County and Municipal Employees, Local 3112, AFL-CIO (2013) _ Cal. App.4th _ , 2013 WL 6909431: See summary above under Arbitration. Quezada v. City of Los Angeles (2014) _ Cal.App.4th _ , 2014 WL 60330: The Court of Appeal affirmed the trial court’s summary judgment for defendant in a case by police officers alleging violations of their rights under the Public Safety Officers Bill of Rights (POBRA) (Government Code sections 3300-3313) and the Bane Act (Civil Code section 52.1) during an investigation of their conduct shooting their guns while off duty and after drinking. The trial court properly granted summary judgment. POBRA was not violated because plaintiffs were ordered on duty, given overtime pay, allowed to eat, drink, use the restroom as needed, and make phone calls. The police department read plaintiffs their Miranda rights; plaintiffs had an employee representative with them at all phases of the investigation; and the department was permitted to change the duties of the officers during the investigation. The seriousness of the incident required the police department to conduct the investigation immediately. It took police four hours to process the crime scene. The police department did not violate the Bane Act because plaintiffs were not threatened with violence, the searches of plaintiffs’ vehicles were not unlawful, and plaintiffs’ right to an attorney was not violated because plaintiffs refused to waive their Miranda rights and POBRA does not guarantee an officer an attorney in an administrative investigation. (C.A. 2nd, January 8, 2014.)
Government Save The Plastic Bag Coalition v. City and County of San Francisco (2014) _ Cal.App.4th _ , 2013 Westlaw 6909479: The Court of Appeal affirmed the trial court’s denial of a petition for writ of mandate by petitioner seeking to invalidate a 2012 ordinance expanding existing restrictions on the use of check out bags. Petitioner failed to establish that the City erred by concluding that the 2012 ordinance was categorically exempt from CEQA. The ordinance was not preempted by the California Retail Food Code, Health and Safety Code section 113700 et seq. (C.A. 1st, filed December 10, 2013, published January 3, 2014.)
Real Estate (CEQA) Market Lofts Community Association v. 9th Street Market Lofts, LLC (2014) _ Cal.App.4th _ , 2014 WL 47016: See summary above under Civil Procedure. Save The Plastic Bag Coalition v. City and County of San Francisco (2014) _ Cal.App.4th _ , 2013 Westlaw 6909479: See summary above under Government. See U.S. Supreme Court opinions at: http://www.supremecourt. gov/opinions/opinions.aspx • See 9th Cir. opinions at: http://www.ca9. uscourts.gov/opinions/ • See Ca. opinions at: http://www.courts.ca.gov/ opinions.htm n
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Continued from page 9 Experiment with page titles that pose or answer questions. Think about adjectives that people might use in their searches for lawyers. However, be mindful of your ethics obligations. Most states put limitations on the adjectives that lawyers can use in communications about their services. Superlatives can be especially problematic. It’s also worth noting that some search engines (Google) may rewrite your page titles. Ultimately, in crafting effective page titles that earn clicks, you should focus on your target users. Meta descriptions are the blurbs that appear below the link in search results. They are created from the meta description tag, for example: <meta name=”description” content=”FREE detailed reports on 1088 Personal Injury Attorneys in Chicago, Illinois including disciplinary sanctions, peer endorsements, and client reviews.” />. After page titles, meta descriptions are probably the most important factor in influencing click-throughs. Think about what you can include here that would compel a searcher to click on your listing over all of the others on the search engine results page. Generally speaking, you should keep your meta descriptions to around 150 characters. Finally, rich snippets are additional detailed information snippets that appear under some results. Think of these as search engine results enhancements. Rich snippets can be exceptionally effective at attracting attention and clicks. In fact, in many instances, listings with rich snippets that appear lower on a page can “steal” click-share from higher-ranked listings that do not include rich snippets. Search engines create rich snippets from structured data markup. Some of the most effective rich snippets that lawyers can use include: • Authorship • Ratings and reviews • Video • Breadcrumbs (sets of links that help in navigating page hierarchy) • Events While structured data probably isn’t a direct ranking factor today, it stands to reason that it will play a larger role in future iterations of search engines.
Paid Search Traffic In addition to earning traffic from organic search results, you can also pay for search engine traffic. The most recognizable paid search engine advertising platform is Google AdWords. You have probably also heard this referred to as pay-per-click (PPC) advertising (although there are other ways to pay for search engine marketing). As you may already know, paid search engine marketing can be very expensive. In fact, competitive high-volume keywords can cost upwards of $100 per click! (Check out Mike Ramsey’s “Paid Online Advertising for Your Law Practice” to learn more.) If you decide to venture forth into the world of paid search advertising, spend a lot of time understanding how it works. 24
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While it’s extremely easy to get started, it can be very difficult and time-consuming to optimize a campaign to realize a return on investment. Further, many firms that advertise on search engines have teams of professionals dedicated to managing and optimizing their campaigns. This makes it that much more difficult for a novice to compete. Google also provides some pretty comprehensive information about using AdWords.
Meaningful Traffic Now you know how to drive traffic from search engines to your website. But it bears repeating that search engines are not magic bullets that will turn your practice around. Earning meaningful search traffic that translates into paying clients can take a lot of effort and money. If you’re just getting started online, you shouldn’t expect significant results from organic search marketing campaigns for months. If you decide to pay for search engine traffic, make sure you clearly articulate the goals of your campaign in advance. n Gyi Tsakalakis helps lawyers put their best foot forward online because clients are looking for them there. He is a co-founder of AttorneySync, a digital marketing agency for law firms. You can find more of Gyi’s writing in his “Optimize” column on Attorney at Work, on Lawyerist and on Avvo’s Lawyernomics blog. First published at www.attorneyatwork.com.
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Make the Timekeeping Honor Roll by Frederick J. Esposito, Jr, CLM Frederick J. Esposito, Jr, CLM, Director of Administration/Chief Financial Officer for the Garden City, NY law firm of Meyer, Suozzi, English & Klein, PC, has more than 20 years of law and accounting firm experience. He is a frequent speaker and author of articles on a wide-range of topics, including financial, strategic, alternative fee arrangements, legal project management, knowledge management and law firm profitability models. In June 2013, he was inducted into the National Speakers Association and in September 2012, Long Island Business News named him CFO of the Year. In addition, he has been a Certified Legal Manager (CLM)SM since 2006, the only CLM on Long Island, and is Chair of ALA’s Certification Committee.
Wise lawyers know that contemporaneous timekeeping is essential to the success of any fee arrangement — and to the overall financial success of your law firm. Lawyers who reconstruct their time weekly tend to lose 25 to 30 percent of their time, and those who enter time on a monthly basis can lose as much as 55 to 70 percent. To illustrate, assume an attorney is billing at $150 per hour and doesn’t capture 15 minutes a day. When you do the math over the course of a year, that one attorney could lose as much as $9,000 a year in billable time—and a firm with 25 attorneys could lose as much as $225,000 in billable time and potential fees. That is a significant number to any law firm.
time every 15 minutes or every time you switch tasks. Incremental steps will help get you into the habit. Whether handwritten and entered in the system by your support staff, or by direct entry (the preferred method), this is a step in the right direction.
You Know the Type
As ridiculous as this may sound, place a sticky note on the inside of your office door, on your computer screen, on your phone, or even on the steering wheel of your car as a reminder to keep recording your time. I know of one firm that went to the extreme of placing time entry reminders in each of its restrooms to make the point. You will find things go much more smoothly if you set up your own reminders, rather than wait for the “time cops” to knock on your door.
Despite statistics that illustrate the impact lost time has on a firm’s bottom line, law firms continue to have chronic offenders. To paint the proper landscape, there are four types of timekeepers: “A” students. These timekeepers are always ahead of the curve by entering their time daily and are low maintenance. Need a kick. These timekeepers generally have 90 percent or better of their time entered each week, but require more frequent prompting and some maintenance. Special friends. These timekeepers are usually missing several days of time at any given point and require constant follow-up. Own worst enemy. These timekeepers are clearly working the hours, but—for whatever reason—do not always record all of their time. Since they have concerns that supervising attorneys will think the time entered is excessive, they often record less billable time just to stay off the radar.
Everyone Can Be an “A” Student Getting to the honor roll for contemporaneous timekeeping can be a slow and methodical process. Here are five tips to ease the way.
Start slow Make a commitment to enter your time in small increments throughout the day. From the moment you arrive in the office, use a clipboard with a timesheet or go the system-savvy route and use a timer. Most time-and-billing software packages and apps have timers to facilitate time entry. Commit to recording your
Try, try again If you forget to record some of your time on a particular day, don’t give up because you “blew it.” Just start recording time again as soon as you realize you fell short. Timekeeping will be more accurate if you have to re-create just a few hours, rather than a few hours plus the rest of the day.
Set up reminders
Inspire to aspire When you don’t track your time and have to reconstruct it, take note of how long that takes you. Remember, reconstructing your time is not only likely to be inaccurate (capture rate significantly decreases with time), but it will take more time to reconstruct than to actually enter it in steps. Some lawyers try to re-create their time by reviewing emails. As methodical as that may seem, you are not capturing all of your time this way. Also, whenever you must reconstruct your time, it means you are either shortchanging yourself or overcharging your client, and consequently dealing with the issues surrounding both scenarios. Keep telling yourself there is a reason. Yes, many view time entry as “an administrative task that gets us paid.” Once in a while, remind yourself of the connection between the accuracy of your time and the firm’s ability to generate timely billing and receive timely collections. Firms that keep contemporaneous time tend to generate 25 to 40 percent higher revenues than firms that do not keep contemporaneous time. This is a real incentive to improve! n Attorney Journal | Volume 126, 2014
f you were to believe everything being written about legal services today, you might think lawyer-client relationships have boiled down to one thing: pricing. Yet in my conversations with clients, fees rarely are the first thing mentioned or the most important factor used to evaluate relationships with outside counsel. Now don’t get me wrong. All clients are cost-conscious, particularly these days. In interviews, clients consistently say things like: “We are always keeping an eye on costs.” “I tell them, ‘You’ve got to be cost-conscious.’” “Do I wish the cost was lower? Yeah, that would be great.” But even those sentiments don’t mean you have to engage in cost-cutting or discounting. What clients usually want are better communication about, sensitivity to and management of costs.
Opening the Lines of Communication Here are some actions relating to pricing and fees that will improve your relationships with clients (and your ability to get paid).
Good Lawyers Talk Money with Their Clients & Billing Is Marketing by Sally J. Schmidt
Sally J. Schmidt is President of Schmidt Marketing, Inc. in Edina, MN. The company’s clients have included over 400 law firms throughout the United States and internationally, ranging in size from two to over three thousand attorneys. Sally received her MBA. and BS from the University of Minnesota, and was the first President of the Legal Marketing Association (LMA). She was inducted into the College of Law Practice Management in 1994 and into LMA’s Hall of Fame in 2007. Sally has made presentations at more than 200 national and international seminars and conferences, including many for ALA, and her articles have been published in every major legal trade publication.
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1. Have good conversations up front about the expected costs of services. Clients appreciate lawyers who take a businesslike approach to the discussion of fees. For every new client or new project, put the issue on the table by saying, “You’re probably wondering what this will cost.” Then give a detailed explanation of the potential fees and expenses. 2. Be clear about what is or is not included in your estimate, and what factors will contribute to higher costs. If you provide a range of $25,000 to $35,000, for example, what will lead to the higher end of the range? If there are things outside your control or not included in the fee, provide a detailed list and, if possible, estimate those items as well. 3. Hold the line on expenses. If you are engaging outside services — from specialized counsel to expert witnesses — do your best to manage their costs, just as you would do with your own. Rightly or wrongly, if those expenses spiral out of control, you will be tainted by association. 4. Be a good steward of the client’s money. For instance, if you need to travel on the client’s behalf, ask for hotel recommendations or whether there are any special travel discounts of which you can take advantage. If a company’s executives stay at Hampton Inns, they won’t appreciate a bill for a Ritz-Carlton. 5. Look for ways to cut costs. Can the client do some of the work inhouse? Or is there a lower-priced alternative for a portion of the assignment? 6. Keep the client posted. Probably most importantly, you must have regular communication with the client about where the fees stand against the original estimate. Whether this is done by holding a periodic budget meeting, generating a monthly chart showing actual versus estimated costs, or providing the client with access to bills through an extranet, nothing will show that you are serious about cost management like monitoring where things stand. And, if you do have a glitch, that is the time to pick up the phone and have a conversation. If you are able to manage expectations about the cost of your services, you are much less likely to have to discount or write off your fees — and managing expectations necessitates good communications. Remember, you don’t need clients to feel you are inexpensive; you need clients to feel they received value. Ultimately, the happiest clients say things like this: “He’s not the cheapest, but he’s worth it.” “They provide us with good value for our legal dollars.” “The firm is a good value for the work.”
Once you have the engagement, your invoices become a critical communication method. In fact, I would argue that bills, properly done, can be great marketing tools. Conversely, poor billing techniques create tension with clients. Clients use any tangible work product to judge the quality of your firm’s services. Said one: “If you can’t get your billing straight, I don’t have confidence in you to get the file straight.” Clients also use invoices to evaluate the progress of matters. With scant information, they are left in the cold. Technology is a wonderful thing. But too many times, lawyers allow computers to drive the form and substance of the invoice. Paying a little more attention to your bills will not only enhance your client relationships, it will increase your likelihood of getting paid.
Cover Letters Everyone talks about providing value. But when was the last time a client said, “Great brief!” or complimented you on the research you did? A cover letter allows you to explain the value you have brought to the engagement. If you are pleased with a result, say so. If you wrote off time, tell the client what it was and why they don’t have to pay for it. You can also use the cover letter to update where the fees stand on the project. And, most important, you can thank the client. It may not be necessary to put a cover letter on every invoice, but at a minimum, you should include one at the end of a major matter.
Show time that you are writing off. If you did something for which you did not get paid, such as attend a client board meeting, enter it at “no charge.” Pay attention. Be sure to apply time to the right file! Concentrate your time. Clients would rather see blocks of time than six-minute intervals. Bill on a timely basis. This helps clients see where they stand on a matter and, studies show, vastly increases your likelihood of getting paid. Don’t nickel-and-dime. How do you feel when your $300-a-night hotel charges $12 for Wi-Fi when the Super8 provides it for free? Disbursements, even if they represent a small percentage of the bill, can be a landmine because clients know what most things cost. In addition, charging .25 for administrative tasks—reading emails, reviewing bills—will cause clients to review future invoices in more detail for billing abuses.
Would You Mind? Perhaps the best thing to do is put yourself in the client’s shoes and ask, “Would I mind paying for this?” Remember, good billing practices result in no surprises for the client. If things are getting out of hand on a matter, pick up the phone. If your bill is higher than anticipated, deliver the invoice in person. When there’s a problem, it’s crucial that you contact clients before they have to contact you. n
Time Entries In my experience, clients’ unhappiness with bills can have as much to do with the way the information is described as the time itself. Here are tips that can help avoid that problem: Be careful how you describe your time. Whether it is when you enter time or when you look at your pro formas, augment the terse computer language. Let’s use “office conference” as an example. First, clients don’t like paying for you to talk to other lawyers in your firm. Second, it provides zero insight into the value provided by the meeting. Instead, focus on what you did, for example, “Reviewed requirements for shareholders’ agreement,” “Analyzed tax issues in proposed trust” or “Met with Attorney A to discuss outstanding issues in settlement agreement.” And name names. Avoid red-flag terms. In addition to “office conference,” other phrases that set clients off include “review of file” (paying you to get up to speed), “research” (don’t you know this already?), “attempted to call,” “left voicemail for” and other things that don’t contribute to the progress of the file. Use active descriptions. For instance, instead of “Consideration of” say “Analyzed.” Show progress. When you write down time for the same matter, be conscious of showing progress on the file. Be consistent. If you referred to the matter as a “stock purchase agreement,” don’t just call it an “agreement” in future bills. Demonstrate value before billing. If possible, don’t bill for projects until clients have seen the related work product. If you have taken a deposition, send clients the summary before they have to pay for it.
JOSEPH MEDIATIONS Over 2000 Mediations & Arbitrations
Former Trial & Supervising Attorney of a 17 Lawyer Litigation Ofﬁce
Former Associate Dean, General Counsel & Adjunct Professor, Thomas Jefferson School of Law
Areas of Expertise • • • • • • • • • •
Personal injury Employment Real Estate Construction Education Environmental Business Commercial Consumer Agriculture
Jeffrey A. Joseph
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Attorney Journal | Volume 126, 2014
Defining Partner Obligations The Rules Have Changed by Joel A. Rose
aw firms continue to struggle to define the obligations of partners. This article sets forth what I believe to be the minimum contributions that should be expected of any equity owner in a law firm. A partner is not fulfilling his or her obligations as an owner of the business if he or she does not meet all the minimum requirements. I hope that you will be able to use these suggestions in thinking about your partnerships, how they operate and how individual partners contribute.
Owner Definition Without engaging in a definitional struggle or semantics, I want to make sure that we are on the same page with regard to the definition of “ownership.” In my opinion, (equity) owners of law firms will contribute in all the ways set forth in this article. They will share risk and reward, invest their time and capital in the business and will do so in a firm-minded manner (nonequity owners should remain nonequity until they do or can fulfill the minimum obligations). Owners have achieved the right to certain benefits of ownership. In addition, they have agreed to undertake obligations, as equity partners, greater than those of nonowners. Too many partners seem to believe that their obligations and contributions can decrease once they wear the mantle of ownership.
Adding Value Adding value has become a platitude strewn about by nearly everyone. But, adding value is precisely what we need from partners. They must do something that enhances the value of the firm other than doing legal work. Consider the litigation partner who typically works 2,300 billable hours per year, bills that commensurate amount and has exceptionally high working attorney fee receipts. This partner, however, does nothing else. Her contributions are valuable, this year, but the firm is no better off the next year or 28
Attorney Journal | Volume 126, 2014
the following year. What investment or legacy has this partner left that improves the firm’s fortunes or competitiveness? None, actually, although she is a useful economic producer. Or how about the 53-year old partner who has steadily seen his work decline until he bills only 1,100 hours per year and does nothing else on behalf of the firm. He says “I am ready to do anything that is available in terms of legal work;” however, he does very little to either go get work from clients or others in the firm. In addition, he is a negative influence around the firm, constantly harping about the fact that the firm is no longer collegial and is losing its soul. Neither of these individuals is acting very much like an owner. Although they may have current value, they clearly are not adding value to the firm.
The Fallacy of “Finder — Minder — Binder — Grinder” In the past, it has been said that firms have “finders” — those who find the work; “minders” — those who mind the work; “binders” — those who manage the work and clients; and “grinders” — those who simply turn out legal work. It has been thought that partners should select (typically independently) from these functions in the firm and fulfill the obligations of the partner. Firms no longer have that luxury. The owners of the organization need to do it all. That is not to say that the “mix” of contributions would be the same for all partners. Not all partners would find work in the same manner nor would they all produce legal work at the same level. The point is, however, that we need the efforts of all partners in all areas, if they are to be treated like equity owners.
The Contributions: In my opinion, partners in law firms have to act like true owners of a business and should be concerned with production, sales, management and profitability. Client-Determined Service Quality: This means that clients,
prospective clients and internal clients (other partners) must receive the level of attention, treatment, timely service, etc., that they expect from every partner. Professional competency is the “price of admission” to the mature legal market. Client-defined quality will increasingly become the competitive differentiator. Lawyers can no longer be comfortable in delivering the quality of service they chose. Clients and prospective clients have too many options and are increasingly demanding. Partners must also serve other partners and their clients in an acceptable manner. Law firm mission statements and similar documentation are crowded with platitudes regarding “highest quality legal services.” Unfortunately, firms often ignore assessing service quality because the partner produces a high volume of fee receipts. If there is any single criterion on which a partner cannot fall down, it is this one. Practice Development: Every partner should energetically participate in practice development efforts for one’s self and for or with others. There are things that any lawyer can do to help develop the firm’s practice. Not everyone should aspire to becoming a traditional rainmaker. However, there must be ongoing efforts in practice development by all owners in order to increase or maintain business. Strategies such as writing to demonstrate competency, speaking and effective networking, cross-selling and similar activities are still effective means of practice development. Management Contribution: Every partner has an obligation to participate in (some portion of ) management to ensure the effective, efficient running of the professional and business sides of the practice. Law firms increasingly have management needs that did not exist ten years ago. Some of these needs are ongoing, such as those of a practice leader; others are ad hoc, such as someone assigned to evaluate the firm’s insurance plan. Skill and Knowledge Transfer: Every partner should, through formal and informal means (mentoring, CLE, briefing/debriefing, training, programs, etc.) participate in the development of younger attorneys into effective practitioners. The transfer of knowledge and know-how regarding technical and practical law practice is poorly attended to in many law firms. This increasingly frustrates younger lawyers, resulting in lawyers who do not gain skill as rapidly as they should and, therefore, are not as valuable (economically) in the marketplace. A trend among (some) corporate counsel is not to allow law firms to use young associates, because these associates are not perceived to add value. The faster the skills of new lawyers can be built, the quicker the market will recognize the associates’ value. Firm Mindedness: An owner must act in a collaborative, team-oriented manner, complying with firm policies, systems and procedures, treating all lawyers and staff with respect and putting the firm first. Law firms do not have the time to deal with aberrant
behavior, even on behalf of economically productive lawyers. In addition, tolerating such behavior sends the wrong message to other attorneys. Many managing partners have told me that they agonized for years over what to do with “the 800 pound gorilla,” who was a productive, economic contributor but a total non-team player and an obstructionist. Effective organizations should not tolerate destructive behavior that tears apart the firm’s culture. Personal Economic Contribution: Each owner should seek to produce working attorney revenue, on a yearly basis, in an amount that would cover his or her compensation plus allocated overhead and an added profit factor. At a time when leverage in law firms is increasingly difficult to achieve, when there is immense pressure on hours, rates and realization, it is necessary for all lawyers to be economically viable (from a productive perspective). The objective is for each owner to meet the economic threshold and participate in the profits available from other sources in the firm, i.e., associates, paralegals and other partners. As a practical manner, not every owner will be a break-even “by the numbers.” This may be satisfactory for a select number of partner as long as that attorney is deemed (by the firm) to add value in other ways. Ideally, these “other ways” can and should be quantified. However, there may be instances — and for the sake of the firm’s profitability, relatively few instances — where a partner’s qualitative contributions may be acknowledged by lawyer management and a significant majority of partners in terms of their contribution to the firm. However, absent clearly adding value in other ways, an owner must be economically viable “by the numbers.”
Conclusion Evaluating a partner and determining what his or her contribution should be is not an easy task. It is also a task that must occur and must increasingly be rational and candid. I asked the managing partner of a firm that had recently implemented the program I have suggested herein “how it went this year during compensation time.” He said, “The decisions weren’t any easier, but we were dealing with a clear set of criteria and our judgment was rational.” That is all you can ask for. n Joel A. Rose is a certified management consultant and president of Joel A. Rose & Associates Inc., management consultants to law firms based in Cherry Hill, New Jersey. He has extensive experience consulting with private law firms, and performs and directs consulting assignments in law firm management and organization, strategic and financial planning, lawyer compensation, the feasibility of mergers and acquisitions, and the marketing of legal services. He may be contacted at firstname.lastname@example.org; Telephone: (856) 4270050 or (800) 381-1645, Fax: (856) 429-0073.
Attorney Journal | Volume 126, 2014
How to Look Like An Expert by David V. Lorenzo David V. Lorenzo is the Chairman and Founder of Rainmaker Lawyer Consulting. He and his team help attorneys make a great living and live a great life. People say his down-to-earth personality reflects more of his street smarts than his Ivy League education.
A few days ago, I met a talented corporate transactional lawyer. Let’s call him Steve (because that is his name). He is smart, personable and knowledgeable about his area of the law. He has a terrific reputation and a significant body of work. On paper, this guy is one of the top transactional lawyers in the state. Unfortunately, law is not practiced on paper. It is practiced in real life. Steve showed up for his meeting with me in a golf shirt and tan pants. His cell phone was clipped to his belt and he had a goatee that looked like it had not been trimmed in at least six months. When we ate lunch, he chewed with his mouth open, spoke with his mouth full and used the wrong fork. During lunch, Steve confessed that he meets with lots of potential clients that never end up hiring him. Steve was meeting with me to see if I could help him turn his extensive knowledge into money in the bank. He was looking for some magic phrase or technique that would help him sign up more clients. Unfortunately, Steve does not know what his true problem is. Steve’s problem is something many lawyers face. He just doesn’t look like an expert. Steve has a problem with his personal brand. To a corporate CEO or General Counsel, Steve looks like a middle manager. He doesn’t look like a lawyer who specializes in sophisticated mergers. He looks like the guy who is dating their daughter and not the guy who will help them handle the Securities and Exchange Commission regulations. To make things clear for Steve, I thought I would share some guidelines that I have developed to help my clients look like experts. Keep in mind that MOST lawyers will not
Attorney Journal | Volume 126, 2014
follow these. That is because they are AVERAGE. If you want to be perceived as being average then you should ignore these as well.
How to Look Like an Expert: A Guide for Steve Shave. Lounge magicians, beatnik poets and high school kids have goatees. Just because you can grow a beard does not mean you should. Look at the CEOs in the Fortune 500. How many do you see with goatees? If you insist on having a goatee, trim it daily.
Lose the belt clip. You are not a Christmas tree with ornaments hanging from your appendages. You should not have a phone hanging from your belt. Put it in your pocket like the rest of the non-senior citizens. If it is too big to fit in your pocket, leave it in the car or buy a smaller phone.
Stop talking. Ask a question then shut up and listen for the answer. Experts impress people with the questions they ask even more than with the information they share.
Eat like a human. Do not chew with your mouth open or talk with your mouth full.
Dress better than the client. If the client is casual, you should have on a jacket and slacks. If the client is in a jacket and slacks, you should have on a suit and tie. If the client has on a suit and tie you should have on an impeccably pressed suit, designer tie, and unique cufflinks (and/or a pocket square). You always want to dress one level above the client. Psychologically, it positions you as an expert. These five tips are a great start toward improving your personal brand. Keep in mind that you have to dress and act like an expert in order to be treated like an expert. n
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