The Legal Intelligencer Blog

Fresh Ink: Inside Today's Legal

Welcome to your Thursday morning round-up of stories in today’s edition of The Legal Intelligencer. All of the links below will take you directly to today’s stories, or you can head straight over to The Legal’s homepage. (Some stories may require registration or a paid subscription.)

The top story this morning is a look at Saul Ewing’s firm financials. As reporter Zack Needles writes, the firm’s revenue inched up, about 0.8 percent, and its profits per partner dipped 3 percent last year.

Below the fold on Page 1, reporter Gina Passarella writes that Dechert has opened a Chicago office with a trio of securities lawyers from Katten Muchin.

Also below the fold on Page 1, reporter Amaris Elliott-Engel writes that Monsignor William J. Lynn took the stand in his own defense yesterday. Lynn is charged with endangering two men who testified they were sexually abused by two priests as youths.

In more Regional News on Page 3, Zack Needles writes that Penn State has announced Stephen S. Dunham as its new general counsel. Dunham has been vice president and general counsel of Johns Hopkins University.

Also on Page 3, reporter Ben Present writes that the state Supreme Court has unanimously ruled that exposure to one fiber of asbestos is not tantamount to a lot.

As always, our People in the News section is on Page 2, and the top stories from our sister publications across the country make up the Page 4 National News section.

In a Bankruptcy Update on Page 5, Andrew C. Kassner and Joseph N. Argentina Jr. write about avoidance actions against seller void purchased bankruptcy claims.

In this week’s Young Lawyer column on Page 7, Susan Morse writes about the perils of overlawyering and underlawyering.

If you have questions or comments about any of today's stories, or our coverage as a whole, we invite you to e-mail any of the reporters directly. We hope you'll enjoy today's Legal.

Fresh Ink: Inside Today's Legal

Welcome to your Monday morning round-up of stories in today’s edition of The Legal Intelligencer. All of the links below will take you directly to today’s stories, or you can head straight over to The Legal’s homepage. (Some stories may require registration or a paid subscription.)

The top story this morning is the next in our series of firm financials, this time taking a look at Fox Rothschild. As reporter Zack Needles writes, the firm increased revenue by 7.3 percent and profits per equity partner by 3.5 percent.

Below the fold on Page 1, reporter Amaris Elliott-Engel writes that the state Supreme Court directed excess class action funds to the IOLTA board. As such, Pennsylvania will become the sixth state in the country to require cy pres funds left over from settlements to be used for legal aid providers or other nonprofits.

Also below the fold on Page 1, reporter Ben Present writes that the Pennsylvania Bar Association has created a task force to take a closer look at the state’s Code of Judicial Conduct.

In more Regional News on Page 3, Amaris Elliott-Engel writes that a Lehigh County jury has awarded a man and his wife $2 million in noneconomic damages because the man has double vision and other eye injuries in the aftermath of a sinus surgery gone wrong.

As always, our People in the News section is on Page 2, and the top stories from our sister publications across the country make up the Page 4 National News section.

In an Insight on Diversity column on Page 5, Elisa N. Bramble writes about establishing lasting connections for diverse law students.

On the Law Technology News page are two articles: How to build a better webinar presentation and an e-discovery course that offers “in the trenches” lessons for students.

If you have questions or comments about any of today's stories, or our coverage as a whole, we invite you to e-mail any of the reporters directly. We hope you'll enjoy today's Legal.

Fresh Ink: Inside Today's Legal

Welcome to your Friday morning round-up of stories in today’s edition of The Legal Intelligencer. All of the links below will take you directly to today’s stories, or you can head straight over to The Legal’s homepage. (Some stories may require registration or a paid subscription.)

The top story this morning is former Justice Sandra Day O’Connor hearing arguments yesterday in the U.S. Court of Appeals for the Third Circuit that centered on an opinion she joined while sitting on the U.S. Supreme Court in 1986. As reporter Saranac Hale Spencer writes, O’Connor, sitting by designation, and a three-judge panel heard arguments in a class action suit brought against title insurers in New Jersey that echoed the Supreme Court’s 1986 decision in Square D v. Niagara Frontier Tariff Bureau.

Also above the fold on Page 1, reporter Amaris Elliott-Engel writes that Philadelphia Court of Common Pleas Judge Jacqueline F. Allen heard arguments over the norms of writing a letter to an expert’s employer. A defense attorney in the case sent a letter to the employer of a medical malpractice plaintiff’s expert, but said she should not be sanctioned because lawyers frequently discuss local physicians who testify as experts, especially if they “go out there and espouse a new standard of care.”

Below the fold on Page 1, reporter Zack Needles writes that Cohen Seglias Pallas Greenhall & Furman has picked up a two-member construction boutique, Byler & Blaker, for its Philadelphia office.

In more Regional News on Page 3, Saranac Hale Spencer writes that challengers to federal laws requiring pornography producers to keep lists of their actors won their big to seek further discovery following a ruling the Third Circuit.

As always, our People in the News section is on Page 2, and the top stories from our sister publications across the country make up the Page 4 National News section.

In an Asset Management column on Page 5, Mark L. Silow writes about taxpayers receiving tax-exempt interest on a settlement in the case of DeNaples v. Commissioner.

In a Health Care Law column on Page 7, Vasilios J. Kalogredis and Karilynn Bayus analyze CMS’s proposed rule on reporting and returning overpayments.

If you have questions or comments about any of today's stories, or our coverage as a whole, we invite you to e-mail any of the reporters directly. We hope you'll enjoy today's Legal.

Fresh Ink: Inside Today's Legal

Welcome to your Wednesday morning round-up of stories in today’s edition of The Legal Intelligencer. All of the links below will take you directly to today’s stories, or you can head straight over to The Legal’s homepage. (Some stories may require registration or a paid subscription.)

Today’s top story is a continuation of our series on firm financials, this time taking a look at Duane Morris, which grew revenue and saw profits per equity partner rise 3.2 percent in 2011. As reporter Zack Needles writes, the firm’s growth largely came from its active practice areas, particularly a broad-based intellectual property practice.

Below the fold on Page 1, reporter Amaris Elliott-Engel writes that the Catholic Archdiocese of Philadelphia asserted its attorney-client privilege regarding 12 documents that Monsignor William J. Lynn wants to subpoena in the criminal case against him. Attorneys for the archdiocese had said in January that it might assert attorney-client privilege that can’t be waived, even if Lynn waives his own privilege.

Also below the fold on Page 1, reporter Gina Passarella writes about a survey taken by Altman Weil that shows managing partners find their practice group leadership to be lagging.

In more Regional News on Page 3, Amaris Elliott-Engel writes that several mortgage lenders are appealing a ruling in a trio of cases that their foreclosure notices were deficient, and are now seeking reargument. A three-judge panel said in all three cases that the lenders failed to comply with the Homeowner’s Emergency Mortgage Act.

As always, our People in the News section is on Page 2, and the top stories from our sister publications across the country make up the Page 4 National News section.

As it is Wednesday, this week’s GC Mid-Atlantic column is on Page 5, as Madeline M. Sherry and Stephen J. Finley Jr. write about the long and winding road of Pennsylvania privilege law, and how best to navigate through recent decisions declaring privilege a “two-way street” in the state.

In an Employment Law column on Page 7, Michael P. Maslanka of Legal affiliate Texas Lawyer writes about 10 lessons learned from 30 years working in the legal profession.

If you have questions or comments about any of today's stories, or our coverage as a whole, we invite you to e-mail any of the reporters directly. We hope you'll enjoy today's Legal.

Fresh Ink: Inside Today's Legal

Welcome to your Tuesday morning round-up of stories in today’s edition of The Legal Intelligencer, which also includes this week’s edition of Pennsylvania Law Weekly. All of the links below will take you directly to today’s stories, or you can head straight over to The Legal’s homepage. (Some stories may require registration or a paid subscription.)

Today’s top story is the third and final installment in a series looking at law firm growth in a no-growth market. Reporter Zack Needles writes that midsized firms are mining their existing client base as a method for revenue growth, seeking to provide the most value to existing and prospective clients.

Also above the fold on Page 1, reporter Amaris Elliott-Engel writes that Philadelphia Common Pleas Court Judge M. Teresa Sarmina has denied the latest defense motion to dismiss charges in the priest sex-abuse case. Prosecutors called the motion to dismiss charges “a press release … [that] spews false information that serves no purpose other than to pollute the pool of jurors.” The case is in the second week of jury selection.

Below the fold on Page 1, reporter Gina Passarella writes that a federal judge’s comments affected sentencing in a $74 million fraud case. The 3rd U.S. Circuit Court of Appeals has remanded the case for resentencing.

In more Regional News on Page 3, reporter Ben Present writes that a RICO claim has survived an early motion in the “kids-for-cash” suit. A federal judge allowed the claim to move forward, but dismissed claims under the Civil Rights Act because they were barred by the statute of limitations.

As always, our People in the News section is on Page 2, and the top stories from our sibling publications across the country make up the Page 4 National News section.

On Page 5 today is a Commentary written by Troy Crichton, who writes about the Barristers’ Association of Philadelphia celebrating its “Meet the Judges and Legislators” event.

In a Litigation column on Page 7, Harrie Samaras and Judy Weintraub write about determining whether mediation is the right choice for your dispute.

As it is Tuesday, it’s also your chance to read this week’s Pennsylvania Law Weekly. The lead story for PLW comes from Ben Present, who writes an analysis of the campaign funds for the Pennsylvania attorney general race. Former Lackawanna County prosecutor Kathleen Kane has more cash in her coffers, but former U.S. Rep. Patrick Murphy has a wider array of supporters.

Below the fold on Page 1, Amaris Elliott-Engel writes about a Pennsylvania workers’ compensation certification process that is set to launch in the fall.

On Page 3, reporter Dan McCormick writes that a judge has denied a grocery store company’s request for a plaintiff’s cellphone records in a slip-and-fall case.

There’s much more inside this week’s PLW, including Samuel C. Stretton’s Ethics Forum, in which he discusses lawyers making campaign contributions to judges; Sam Pond and Allison Wheeler’s commentary on proposed utilization review changes that they believe will prove unfair to injured workers; the state Superior Court ruling that a deactivated e-mail account can still be searched; and David Mandelbaum’s Environmental Law column on tracking environmental debts.

If you have questions or comments about any of today's stories, or our coverage as a whole, we invite you to e-mail any of the reporters directly. We hope you'll enjoy today's Legal.

Fresh Ink: Inside Today's Legal

By Jaime Bochet
Of the Legal Staff

Welcome to your Monday morning round-up of stories in today's edition of The Legal Intelligencer. Click the links below to access stories directly, or head to The Legal homepage.  (Some stories may require registration or a paid subscription.)

Leading the front page this morning, U.S. Courthouse Correspondent Shannon P. Duffy has an interview with Reginald T. Shuford, the new executive director of the ACLU of Pennsylvania. Also available on our website as a complement to the article is a videotaped portion of the interview -- simply click here to view it, or head to the homepage and click on "Featured Video."

Sharing the top of the page, senior reporter Gina Passarella has the localized results of the AmLaw's midlevel associates survey. According to Gina, "The bulk of Pennsylvania firms did a better job keeping their midlevel associates happy this year than they did last year. That comes amid a national picture that presented the lowest associate satisfaction score since 2004, according to the magazine’s 2011 Associates Survey."

Below the fold, reporter Amaris Elliott-Engel writes that a Philadelphia judge has ruled the $27.6 million awarded to a woman and her husband who said she was injured while taking part in a promotional video for an artificial knee implant should not be reduced.

Reporter Zack Needles has today's Page 3 Regional News story, reporting that Philadelphia-based Hangley Aronchick Segal & Pudlin is now Hangley Aronchick Segal Pudlin & Schiller, marking the firm's first name change since its founding in 1994.

As always, our People in the News section is on Page 2, and the top stories from our sister publications across the country make up the Page 4 National News section.

Today's Page 5 "Family Law" column is by Albert Momjian of Schnader Harrison Segal & Lewis, who asserts that while family law may not make the practitioner a multimillionaire, it certainly is fascinating. Sometimes the facts of the cases are more unusual than the fiction created by soap opera writers. Sometimes the issues are more interesting than the tests created by law school professors.

Page 7 is where you'll find a "Commentary" article from our San Francisco affiliate, The Recorder. Frank H. Wu of Hastings College of Law writes, "I remain convinced that a Juris Doctor degree is an advisable investment. I'd like to explain why. I know, of course, that as a law school dean I have an interest in the matter, yet I have the role that I do because I believe in the professional training we offer and not vice versa."

Have questions or comments about any of today's stories, or our coverage as a whole? E-mail me or any of the reporters directly. We hope you'll enjoy today's Legal!

Jaime Bochet is the Magazines & Supplements Editor for The Legal. Follow her on Twitter at @JaimeBochetTLI or e-mail JBochet@alm.com.

Will Uncertain Client Demands Continue to Fuel Turbulence in IP Marketplace?

By Anthony S. Volpe
Special to the Legal

We have seen an increase in the amount of movement, both locally and nationally, of IP attorneys in and out of general practice firms and out of IP boutique firms into smaller IP boutiques with a more limited focus on certain practice areas.

The question raised by these movements is whether they reflect client needs or the shifting needs of the attorneys in view of what they perceive to be the new order in IP practice.

There has been a continuous increase in the demand for lower costs, while at the same time there has been an increase in the demand for value-added IP services. Many of the clients searching for new firms or a new arrangement within an existing firm are stressing the need for the selected IP firms to have a firm grasp of their business models and to deliver IP services, especially patent and trademark prosecution, at commodity pricing. 

These client demands are more frequently finding their way into discussions of the firm's licensing support and litigation services, where clients are increasingly demanding defined cost controls.
So, how does the shifting client demand influence or translate into the movement of IP attorneys between and among existing firms with IP practices and newly created IP firms?

Some of this movement may be driven by the often-repeated statement that a particular lawyer moved to gain a larger/smaller platform that is a better fit for the demands of existing clients.  The size of the practice group the lawyer required to meet client needs seems to be determined by the size of the group available at the successor firm; this size is almost always the size that best fits the public relations story accompanying the move. 

My guess is that these moves are being driven more by personal views of the desired practice management than by client demands. If the attorney or group does not have the necessary level of influence within the firm's management group, the move is more often driven by the attorney's need/desire for more control in billing arrangements, or the realization that others with more influence are driving conflict decisions that hamper new client development or cross selling opportunities. I see these movements as being more attributable to the circumstances within a firm than to client demands for change.

Some of the movement may be driven by the more recent trend among some clients to view everything as a commodity that can be competitively priced by market pressures on supply and demand.

If prosecuting firms need a certain volume of work to achieve efficiencies that produce profits, unit pricing can be negotiated against a given volume of active cases. This type of economic model has lead to the creation of low-overhead firms that offer unit pricing without regard to subject matter. In these arrangements, there is often very little attention paid to a particular matter until it has demonstrated value within the IP rights portfolio.

This belated determination of value is a major problem associated with this volume/price model, and it may be a direct result of the model. If the attorney or firm has decided to price services on the basis of volume, there is not likely to be much time for consideration of anything that is not focused on the immediate task. Since the basis of the bargain is price for volume, and volume demands throughput to achieve profits, there is an operational dynamic that works against added value. This may be acceptable to the client, but it seems to be against the client’s best interest.

Because companies are increasingly aware of the importance of securing and protecting IP rights and are increasingly under pressure to control cost, there will be a continuing tension between spending on IP services and the creation of added value in the portfolio as a result of those services.  Companies will continue to search for the right model and IP attorneys and firms will continue to modify their approaches to address their perception of the clients' needs.  Since there is currently no uniform direction of the demand from clients, the currents will continue to shift according to the client's philosophical approach to cost and value. Reaction to those currents will produce continued turbulence.

Anthony S. Volpe is a founding partner of Volpe & Koenig. He can be reached at TVolpe@volpe-koenig.com.

Will Non-Lawyers Investing Destroy the Legal Profession?

By Anthony S. Volpe
Special to the Legal

The fight over allowing non-lawyers to become investors in law firms is heating up, and there are now at least three suits challenging the current prohibition against non-lawyer investment. In no small way, this bears a striking resemblance to the fight over lawyer advertising, with the big exception being that investing will not be immediately apparent, as is the case with an advertisement.

While the debate is one over changing a tradition, there are issues of transparency. And, if there is transparency, will the majority of the public or clients really grasp the meaning of the disclosed investor information?

Lawrence J. Fox, a respected ethics expert, has expressed the concern that non-lawyers will not understand that our duty is to the client and not firm shareholders. A valid point, for sure, but an overstatement of the issue.

Firms, especially larger firms, often have bank covenants that require certain cash flows, stabilities in the "rainmaker" ranks, and limitations on contingencies. While these are not "investors" as such, the banks are clearly making an investment. The demise of more than one firm has been tired to banking obligations and the exit of rainmakers when the banks impose certain conditions like personal guarantees for future financing.

When those lawyers leave the firm over financing issues, does it serve their clients? Are these banking considerations about their client service or personal interest? 

On the other hand, Fox is not a "Chicken Little." Concerns about attorneys serving their own financial interest by recommending outcomes that increase cash flow using client funds and the like are a constant blemish on the practice. 

Such self-serving practices bring out another issue: what will the public perceive as the motivation for the investments? Will this be seen as lawyers becoming "investment bankers" who are only concerned with huge salaries and bonus?

Much of the power of law comes from the public's view of the ends the laws are serving. Will non-lawyer investment look like greedy lawyers selling a share in the client's matter as a hedge against a negative outcome? Anything that further erodes public trust in lawyers will adversely reflect on all lawyers and the legal system as a whole.

Some advocate the non-lawyer investment pool as a way to finance small firms that will take on risky matters; the David and Goliath argument. Big firms are against new investment because it will make smaller firms better able to compete. In a nutshell, big firms raise concerns about ethics and client service as a way to protect their finances. The counter to that is that small firms want the investment so they can take less meritorious cases and have the investors bear the risk.

I have no strong view either way. For sure, lawyers already accommodate changing practice rules and economic conditions with guidance from experts like Fox. If we are honest about identifying the real concerns and address them honestly, perhaps through the use of professionals managers, like a COO or CFO, these issues may be resolved within the bar without the loss of public confidence in the profession. 

Anthony S. Volpe is a founding partner of Volpe & Koenig. He can be reached at TVolpe@volpe-koenig.com.

Will Non-Lawyers Investing Destroy the Legal Profession?

By Anthony S. Volpe
Special to the Legal

The fight over allowing non-lawyers to become investors in law firms is heating up, and there are now at least three suits challenging the current prohibition against non-lawyer investment. In no small way, this bears a striking resemblance to the fight over lawyer advertising, with the big exception being that investing will not be immediately apparent, as is the case with an advertisement.

While the debate is one over changing a tradition, there are issues of transparency. And, if there is transparency, will the majority of the public or clients really grasp the meaning of the disclosed investor information?

Lawrence J. Fox, a respected ethics expert, has expressed the concern that non-lawyers will not understand that our duty is to the client and not firm shareholders. A valid point, for sure, but an overstatement of the issue. 

Firms, especially larger firms, often have bank covenants that require certain cash flows, stabilities in the "rainmaker" ranks, and limitations on contingencies. While these are not "investors" as such, the banks are clearly making an investment. The demise of more than one firm has been tired to banking obligations and the exit of rainmakers when the banks impose certain conditions like personal guarantees for future financing.

When those lawyers leave the firm over financing issues, does it serve their clients? Are these banking considerations about their client service or personal interest? 

On the other hand, Fox is not a "Chicken Little." Concerns about attorneys serving their own financial interest by recommending outcomes that increase cash flow using client funds and the like are a constant blemish on the practice. 

Such self-serving practices bring out another issue: what will the public perceive as the motivation for the investments? Will this be seen as lawyers becoming "investment bankers" who are only concerned with huge salaries and bonus?

Much of the power of law comes from the public's view of the ends the laws are serving. Will non-lawyer investment look like greedy lawyers selling a share in the client's matter as a hedge against a negative outcome? Anything that further erodes public trust in lawyers will adversely reflect on all lawyers and the legal system as a whole.

Some advocate the non-lawyer investment pool as a way to finance small firms that will take on risky matters; the David and Goliath argument. Big firms are against new investment because it will make smaller firms better able to compete. In a nutshell, big firms raise concerns about ethics and client service as a way to protect their finances. The counter to that is that small firms want the investment so they can take less meritorious cases and have the investors bear the risk.

I have no strong view either way. For sure, lawyers already accommodate changing practice rules and economic conditions with guidance from experts like Fox. If we are honest about identifying the real concerns and address them honestly, perhaps through the use of professionals managers, like a COO or CFO, these issues may be resolved within the bar without the loss of public confidence in the profession. 

Anthony S. Volpe is a founding partner of Volpe & Koenig. He can be reached at TVolpe@volpe-koenig.com.

Scranton Firm Announces Merger With Phila. Nonprofit Law Boutique

By Zack Needles
Of the Legal Staff

Scranton, Pa.-based general practice firm Myers Brier & Kelly has announced a merger with three-lawyer, Philadelphia-based nonprofit law boutique Lundy & Flynn.

While the merger became official on Jan. 1, the two firms made the announcement last week.

The combined firm, which now has 14 lawyers, has continued under the Myers Brier & Kelly name.

"We had been working closely with many Myers Brier & Kelly attorneys," said Joseph E. Lundy, a founding partner of Lundy & Flynn and now a partner at Myers Brier. "They still have a very strong nonprofit practice within two or three other practice groups. We were being asked to work with them on a number of matters in Northeast Pennsylvania, in particular."

Lundy said the move has been mutually beneficial because his former firm, which did most of its work in federal courts, gives Myers Brier a more national practice, and Myers Brier gives the former Lundy & Flynn lawyers a bigger base and a wider statewide presence.

"We concluded that one and one would equal three and not just two," he said.

According to Lundy, the nonprofit law practice remained "very steady" throughout the recession.

"Nonprofits do have issues with the economy going one way or another. In some ways, they need to turn up their game in a way that’s different than for-profits," he said, explaining that nonprofits don't typically have the ability to reduce manufacturing or services in a down economy. 

"They need, more so than for-profits, to find ways to work through it and we help them do that."

Zack Needles is a reporter for The Legal. He can be contacted at ZNeedles@alm.com or 215-557-2493. Follow him on Twitter at ZNeedlesTLI.