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Wake Up Call: Profits Fall Again as Demand, Expenses Take Toll

Aug. 8, 2022, 12:40 PM

In today’s column, Colorado could become the next state to let nonlawyers practice in limited areas of law; Houston powerhouse Vinson & Elkins is battling global giant Kirkland & Ellis for supremacy in Texas; and Eversheds Sutherland is opening an office in Frankfurt, Germany.

  • Leading off, law firms’ average profits per equity partner fell 3.6% in 2022’s second quarter—the second straight quarter of decline—as demand shrank and expenses soared, a new report from Thomson Reuters says. The report cites inflation, competition for talent, office returns, and a slowdown in corporate and M&A work as causes for the decrease. (Reuters)
  • Colorado could be the latest state to allow nonlawyers to practice in some limited areas of law. The state’s Supreme Court is reportedly considering a proposal that would create a “licensed legal paraprofessional” position for experts that could represent clients in some divorce and child custody cases. (Denver Post)
  • Oregon, Washington, Utah, Arizona, and Minnesota are already offering paraprofessional programs with variations between states. Supporters say the programs help close the access-to-justice gap. (BLAW) Opponents say inexperienced paraprofessionals could make mistakes and/or give clients bad advice. The California State Bar continues to work on its own proposal for a paraprofessional program despite fierce resistance from lawyers and lawmakers. (The Recorder)
  • Vinson & Elkins, a century old Houston-founded energy law firm, is battling Chicago-founded Kirkland & Ellis for Texas talent, clients, and revenues. Kirkland, which arrived in Houston eight years ago, is the world’s biggest law firm by revenue. (Houston Chronicle)

Lawyers, Law Firms

  • Eversheds Sutherland said it’s opening an office in Frankfurt, Germany, in January. The office’s first partner will be corporate and M&A attorney Steffen Schniepp, who joins from PwC Legal, where he was Germany managing partner and leader of the firm’s global M&A practice. (Eversheds-Sutherland.com)
  • Fox Rothschild said its 33 year old New Jersey-based gaming partner Harry Jackson, co-chair of the firm’s American Indian practice group, was killed in a traffic accident. (Fox Rothschild)
  • An incoming Florida rule requires insurers to report plaintiffs’ legal fees, but the insurers say they often don’t have that data. (Insurance Journal)
  • Michigan’s incumbent attorney general alleges her Trump-endorsed opponent in an upcoming election had a role in a potentially criminal scheme to seize and tamper with voting machines. She’s asking for a special prosecutor to be named to investigate. (Politico)

Laterals, Moves, In-house

  • Goodwin hired former McKinsey Digital global managing counsel Rachel Dooley as chief innovation officer, based in New York; Freshfields Bruckhaus Deringer grabbed Kirkland & Ellis lending and restructuring partner Lisa Stevens as a partner in London in its global restructuring group; Ropes & Gray named corporate partner Jaewoo Lee its office managing partner for Seoul, Korea. He takes over from corporate attorney William Y. Kim, who’s had the role since the office was established in 2012 and will remain as senior counsel; Clifford Chance in Singapore hired former US federal prosecutor and SEC enforcement attorney Vasu Muthyala as a partner for its litigation and dispute resolution team. He’ll relocate from Hong Kong, where he recently led Kobre & Kim’s Asia investigations practice; Clifford Chance also hired Nina Goswami as UK head of inclusion. She arrives from broadcaster BBC, where she was creative diversity lead and output editor; Miami-based Lash & Goldberg added health care and commercial litigation attorney Annette Urena Tucker as partner. (Lash & Goldberg)

Legal Education

  • Stanford Law School’s Rhode Center and legal design lab said they’re collaborating with six states on a program to use technology to improve access to justice. (Legaltech News)

To contact the correspondent on this story: Rick Mitchell in Paris at rMitchell@correspondent.bloomberglaw.com

To contact the editors responsible for this story: Chris Opfer in New York at copfer@bloomberglaw.com; Darren Bowman at dbowman@bloomberglaw.com