To some counsel – certainly those mired in the past – the notion that clients could find the best of them wanting because they are “pure advocates” is tantamount to heresy.
But times have changed. “Being a pure advocate just doesn't cut it with clients anymore,” says Paul Morrison, a senior partner in the litigation group of McCarthy Tétrault LLP.
And even the most adamant of traditional counsel will admit that winning isn't everything in today's environment. Some might even concede that winning isn't always the most desirable of outcomes for their clients. “A frequent cause of litigation breaking down is the failure of counsel to explain the full cost and strategic consequences not only of failure, but also of success in the sense of ‘winning' the case,” says Geoffrey Cowper, QC, national head of Fasken Martineau DuMoulin LLP's litigation department.
There are corollaries to these heresies. One can be found in the skepticism that now greets the marketing maxim “If you do good work, you'll get good work,” attributed to the legendary James McRuer, former Chief Justice of Ontario.
“It serves the superstars well,” according to one of the industry's veteran counsel. “But how many Earl Cherniaks [of Lerners LLP] do you see out there?”
For the great unwashed, then, developing marketing skills is essential. “If you're a litigator who wants to be a partner, you better have a strategy of practice development,” says David Byers, who heads Stikeman Elliott LLP's litigation group.
It's not that excellent advocacy skills aren't a requirement, it's just that having those skills is in and of itself no guarantee of success in a world where business solutions and efficiency drive the litigation bus.
“Attracting and growing great advocates was enough to maintain and build a top-flight litigation department or boutique 20 years ago,” says Linda Plumpton, a Torys LLP partner and former head of the firm's litigation department. “That's not the case now.”
Instead, strategic thinking, client communication, case-management skills and team-building sensitivities combine with advocacy expertise to form the head and heart of today's successful business litigation counsel.
“The most successful litigators these days are the ones who not only have the necessary forensic skills at clutch time, but can also manage large and complex cases, of which the vast majority will never get to trial,” says Glen Poelman, Chair of Macleod Dixon LLP's Litigation Practice Group. “That means managing teams composed of lawyers, paralegals, experts and consultants, and usually a core body of client representatives or witnesses — all the while keeping the big picture in focus and not letting cases take on a life of their own.”
Even junior associates will have to learn management skills at an early stage. “Clients are prepared to accept less hands-on control. So instead of doing basic tasks, associates will be responsible for managing the third-party providers who are doing the jobs they used to do,” Plumpton says.
Effective project management, then, is clearly a big part of the solution to the value equation clients are seeking. But the degree to which that will entail a reliance on outsourcing – in the sense of sending work normally done by lawyers, such as document review, to third-party providers – remains to be seen.
“The trouble with outsourcing is that you don't end up having someone in-house who has put their head around the documents,” says Robert Staley, Co-Chair of Bennett Jones LLP's litigation department. “On the other hand, there are cases we would outsource if we had to do it again.”
Arguably, then, whether to outsource or not boils down to communication and judgment, two important components of the skill set today's litigators need.
“Outsourcing is not a one-size-fits-all solution,” says Crawford Smith, who heads of Torys' litigation department. “But law firms need to have relationships in place so they can provide their clients with options.”
That suits Darryl Cruz, who is the leader of McCarthy Tétrault's Litigation Practice Group, just fine. “I definitely think we're heading to a much heavier reliance on outsourcing,” he says.
“It emphasizes our view of ourselves as sophisticated advisors on complex matters, and it turns our associates from assembly-line widget makers who read every single document into project managers who understand what's important in the
documents.”
Cruz also believes that moving to outsourcing will have a positive impact on associate retention ratios. “Outsourcing isn't just a response to client pressure,” he says. “It's also there because the work outsourcers do is not enjoyable for the army of associates who have had to endure mind-numbing tasks they don't want to do. On the other hand, having strong project skills can turn their participation in litigation closer to the exciting endeavour it can be.”
Having said all of this, outsourcing – touted in many circles as the solution to the bottom-heavy dilemma law firms are said to be facing – is hardly the flavour of the day among most Canadian litigation firms. Rather, the prevailing approach appears to be a cautious one that suggests outsourcing is only one small part of the overall response to clients' demands for greater efficiencies. Indeed, many firms appear to see contract lawyers as an even better solution.
At Macleod Dixon, for example, outsourcing really isn't on the radar screen. “We have not done any outsourcing, nor do we currently have plans to do so,” Poelman says. “Very occasionally, the pressure of large project files has led us to take on contract lawyers, but that is as far as we have gone outside of the usual student, associate and partner mix.”
The approach taken by Borden Ladner Gervais LLP is similar. “If by outsourcing you mean sending legal work to be done outside the firm, we do not do that,” says Ira Nishisato, National Leader of BLG's Commercial Litigation Practice Group. “On a number of occasions we have hired contract lawyers known to us to assist with major document review projects, and this has proven to be an effective way of delivering value to our client. We also work with outside vendors on e-discovery and computer forensic services.”
Nor has Osler, Hoskin & Harcourt LLP wholeheartedly embraced the outsourcing concept yet. “We continue to examine outsourcing opportunities,” says Larry Lowenstein, Chair of the Osler Litigation Department. “For scanning and coding production, we work with specialist outside providers. We have also identified some quality lawyers whom we hire on a contract basis to perform specified tasks under our supervision, like initial document review.”
Byers at Stikeman Elliott seems somewhat less cautious: “We look for efficiencies in discovery that may involve outsourcing aspects of the discovery process.” Meanwhile, Ogilvy Renault LLP uses “consultants” for e-discovery, but again in a limited way. “We have used consultants to set up and maintain databases to manage evidence that is available in electronic format, depending on the sheer size of the electronic evidence to be reviewed,” advises Sophie Melchers, head of the firm's Montréal litigation group.
For its part, Torys seems ready, willing and able. “We have developed relationships with a number of firms that allow us to respond to clients' needs and the demands created by their cases,” says Smith of Torys. “These relationships include outsourcing e-discovery in varying degrees, hiring contract lawyers and, if need be, project managers.”
Cassels Brock & Blackwell LLP is outsourcing e-discovery, and McCarthy Tétrault appears to have considerable experience with the practice. “We have outsourced large document projects to vendors specializing in those services and we have used contract lawyers on those projects,” Cruz says. “We have not outsourced other legal work and do not intend to do so.”
And where are Canadian firms directing their outsourcing? For the most part, “Buy Canadian” appears to be the comfort zone for the country's law firms. “There are numerous litigation support companies in Canada that provide assistance with e-discovery and large document reviews,” Cruz says. “We have not outsourced overseas and our present preference, if outsourcing is required, is to use local companies with experience in Canadian e-discovery.”
That's not to say some outsourcing doesn't go offshore. “Largely, the firms are domestic, although we have worked on matters where work has been outsourced offshore to places like India,” says Torys' Smith.
Still, as Poelman points out, case management – whether in the form of outsourcing or otherwise – is fine as far as it goes, but only if the managers keep the big picture in focus.
Which leads to the next question: what's the big picture?
“It's all about understanding the business, appreciating the organization's tolerance for risk, and bringing creativity and innovation to the process,” says Susan Rabkin, VP and General Counsel for North America at InBev and Labatt.
In practical terms, this means that prevention, risk assessment, damage control, cost, end-of-the-day liability and survival are all at the forefront of clients' thinking. “As clients become more sophisticated in identifying potential disputes, they're consulting us earlier than they used to,” says Gerald Ranking, Chair of Fasken Martineau's Ontario litigation department.
“Increasingly, litigation counsel find themselves in the position of trusted business advisor who will preserve a client's money and reputation.”
Mark Evans of Fraser Milner Casgrain LLP (FMC) says that clients have moved from reacting to claims to seeking advice and options to avoid the claims in the first place. “It's not that clients have no need for the litigation department's traditional role of effective advocacy,” Evans says. “It's just that a full-service litigation department is no longer servicing clients properly if its lawyers don't play a proactive role as well. Think of it as putting ‘counsel' back into the term.”
Put another way, it's the client's risk tolerance that governs, not that of the lawyer. “You cannot overwork a file to satisfy your own neurotic needs,” Lowenstein says. That's because cost invariably factors into the equation for both the client, who must consider the outlay, and for the law firm, where time that can't be billed doesn't do much for profitability. And while there's certainly truth in the old cliché that cost and value are different things, it's also true that cost can factor significantly into a client's perception of value.
“Gone are the days when clients come to you with a $100-million or even a $1-billion lawsuit and your instructions are, ‘Do what you have to do,'” Ranking says.
So while the name of the game is still litigation, the orientation is far broader than it was in the past. “Clients are not looking for trial skills and they're not looking for dispute-resolution skills,” says no less an authority than Glenn Smith, a founding partner of litigation boutique Lenczner Slaght Royce Smith Griffin LLP. “They want proactive risk management and they want people who can keep them as far away from a courtroom as possible. People who want a trial are fewer and farther between every single day.”
And that thought brings forth another near heresy: “If being right in the law doesn't effect a business solution, then being right in the law is just one of the spokes in the wheel of what lawyers must provide to their clients these days,” says Geoffrey Shaw, who leads Cassels Brock's litigation practice. In other words, there are only so many situations that warrant running up hours to research the law in New Zealand.
“What it amounts to is that we're still looking for those people who have the best judgment about what to do in a case,” Byers says. “A lot of the other aspects of the job can be taught and learned, but judgment is innate.”
On the other hand, the degree to which client development can be taught and learned may still be open to question. What's not open to question is that, for a litigation department or boutique to survive, a succession plan must be in place.
“Having all the advocacy and case-management skills in the world is not enough these days,” Lenczner Slaght's Smith says. “Associates still have to be responsible for building their own practice if they have partnership aspirations.” The firm's job is to inculcate associates “in year one” with what it takes to be a partner. “What that involves is bringing in trainers and consultants who can teach our associates how to develop relationships and how to be valuable to clients,” he says.
The upshot, of course, is that maintaining and building a litigation department in today's environment has become a complicated endeavour, and one that engages two critical functions: ensuring that team members have the skill sets required to service clients and attract new ones, as well as staffing files with the appropriate combination of experience, expertise and outsourced resources.
“Providing value to clients means that firms will have to devote more energy to picking the right people in terms of expertise and experience when they're staffing files,” says Don Jack of Heenan Blaikie LLP.
Firms must also ensure that those chosen to play the game want to play with each other. But teamwork, whether with clients or colleagues, isn't part of lawyers' training. “Law school is for the most part an individual experience, except for things like mooting, where students work in groups,” Cruz says. “Contrast that with MBA school, where students work in teams from the moment they start. Law school doesn't prepare lawyers for working with other people, communicating with them or managing their expectations.”
Picking the right people for a team, of course, means having the right people to start with. “The recruiting focus used to be on individual brilliance in terms of legal thinking and analysis,” Cruz says. “Now we're looking for other competencies, such as business acumen, the ability to be a team player and leadership qualities — non-traditional criteria of the kind that behavioural interviewing reveals.”
Nor are these non-traditional criteria optional. “We recognize that the people who succeed are not only the ones who can rip a witness apart,” Poelman says. “We're looking for individuals with wide-ranging people skills who don't inadvertently create adversarial situations when they're not warranted. Instead of one-dimensional pit bulls, we're looking for balance, intelligence and the ability to keep a file moving in a way that allows the client to see an end in sight.”
Cruz agrees. “Clients aren't interested in brilliant advocates who have a million ideas and provide excellent service if these qualities are going to cost too much,” he says. “They want lawyers with strong project skills.”
Determining which litigators will develop into the “right kind of people,” however, has made the business of recruitment complicated. “We spend a great deal of time on client-centred recruiting,” says Evans at FMC, “but it is a challenge to find bright, capable people who can fill the multi-faceted skill set that's required.”
Ogilvy's Melchers concedes there's a lot of intuition involved. “Ten or 12 years ago, we paid a lot of attention to grades in particular courses,” she says. “Now I'm looking for that special spark that provokes me to want to work with an individual, because I'm fairly confident that clients will feel the same way. It's a spark that says, ‘I can trust you, I know you can run with the ball and I know you'll get back to me.'”
Shaw agrees: “I'm looking for something indefinable that tells me the person I'm interviewing has that certain je ne sais quoi.”
Training looms larger than ever in ensuring a litigation department's healthy development. “In my view, the recruiting focus has not changed,” Byers says. “It's the way we train our lawyers and what we train them in that's changed.”
BLG's Nishisato has a similar view. “We have not changed our recruitment criteria or our process,” he says. “But our internal training programs place much greater emphasis on efficiencies and cost effectiveness in running files.” Which is not to say that firms are neglecting traditional training. “Because we have priced so much litigation out of existence, most files tend to be very large projects that give associates little exposure to trial and examination skills,” Poelman says.
Cassels Brock's Shaw says advocacy training is the “$64,000 question” for litigation departments.
“More and more of the experience that associates are getting is not training by fire,” he says. “That's why we do secondments to Eddie Greenspan's office. Although criminal law isn't an area we practise in, it does provide greater opportunities for getting associates into a courtroom.”
Creating opportunities for associates to get on their feet where the opportunities might not otherwise exist, then, is de rigueur at many firms.
“We do try to find niches on even the largest cases where we can give associates opportunity to handle witnesses,” Poelman says. “We also encourage participation in the week-long trial-advocacy programs put together by law schools and law societies.”
For its part, Bennett Jones takes on files for the purpose of giving associates “on your feet” experience. “We have made a conscious decision to take on lesser dollar-value files so our juniors can get that experience,” Staley says. “Pro bono work is also an excellent training ground, as are arbitration and tribunal work.”
Blake, Cassels & Graydon LLP has invested heavily in internal training programs and fostered an extensive pro bono program. “We also encourage our associates to join The Advocates' Society and other professional groups, and we're involved in the small-claims courts where our associates act as duty counsel,” says Jeff Galway, the Litigation Group Co-ordinator for the firm's Toronto office.
Here, the encouragement of clients can be heartening. “Clients want us to be doing this work and have strongly supported our partnership with organizations like Pro Bono Law Ontario and the Canadian Civil Liberties Association,” Lowenstein says. “The Royal Bank has even gone so far as to waive any conflicts that arise from pro bono work.”
Assuming, then, that the appropriate skill sets populate a firm's litigation department, how should those skill sets be distributed? What should the ratio of junior to mid-level to senior associates be? What about the ratio of junior, mid-level and senior partners? And, for that matter, what about the overall ratio of partners to associates?
“Our pyramid is not optimal because I think that the bet-the-company litigation we attract requires that we have people at every level, more younger lawyers, and a higher ratio of associates to partners,” Melchers explains. “The firms should just take the hit for the younger lawyers' training because no client should pay for that. It's already common practice to write off learning curve time.”
While Lowenstein agrees that clients should not pay for associates' education, he believes that the cost of training will impact the pyramid. “I just don't believe that litigation departments can continue to be as bottom-heavy as they are now,” he says.
But there are telling signs so far that outsourcing will not significantly impact the demand for junior litigation associates. To begin with, as detailed previously, Canadian firms' cautious approach to outsourcing indicates that significant change is a ways off; secondly, most major Canadian firms foresee no changes to their departmental hiring practices as a result of evolving client demands; and thirdly, most major firms don't see the need for major organizational changes in their litigation departments.
“The problem with the thinking that firms are too bottom-heavy is that clients appreciate deep bench strength when the big cases come up — especially in an era of e-discovery, which requires more junior staff,” Staley notes.
Of all the firms mentioned in this article, none indicated that they intend or foresee any change in their associate hiring practices. “We hired our usual complement in 2009 and expect to do so again in 2010,” says McCarthy Tétrault's Cruz, echoing the general response.
What's more likely to happen is that the promotion process will become more selective, as evidenced by the trend to merit-based as opposed to lockstep compensation for associates. “The new paradigm for litigation departments has created opportunities for top associates who can do the work at a lower rate than partners,” Nishisato says.
In other words, the pyramid may get broader near the bottom and narrower near the top. “There's an element of Darwinian process through the associate ranks, so people who have the gift of getting right to the issue and communicating with the clients won't be faced with big write-offs throughout their careers,” Lowenstein says. “Their efficiency will be wrung out earlier than it is now. A new accountability will replace the bureaucracy without a face that exists today, and entrepreneurship will be rewarded with promotion.”
Otherwise, none of the firms interviewed for this article planned major organizational changes in response to the changing legal market environment. Indeed, most firms believe they are nimble enough to adapt quickly to changing market conditions and client needs.
That's not to say that more fundamental changes are not on the horizon. “We have not changed the structure of our group directly,” Cruz says. “But as the prevailing forces continue to build, we will undoubtedly have to consider our optimum size and structure.”
Meanwhile, it's not as if things aren't changing within the existing structures. Most commonly, firms continue to search for efficiencies in knowledge management and technology. McCarthy Tétrault has created a significant litigation support group to deal with e-discovery and has invested heavily in project-management resources.
What does appear to have changed significantly, however, is a growing emphasis on specialization and the creation of sub-specialties within litigation departments. “There's much more specialization as time goes on,” Byers says.
Torys, for example, has developed intellectual-property and broker-dealer litigation sub-specialties; Cassels Brock is promoting client, industry and multi-disciplinary teams where feasible; and BLG has created nine focus groups within the commercial litigation department.
“Law firms have had no choice but to create specializations that mirror the demands of clients and the industries in which they operate,” Nishisato explains. “Clients want the expertise that specialization creates and they want lawyers who can immerse themselves in the industries with which their practices are associated.”
But specialization can also drive marketing and client development. “Specialization allows lawyers to make names for themselves much faster,” Byers says.
To this end, Ranking, who assumed the leadership of Fasken Martineau's Ontario litigation department a year ago, has fostered the concept of practice areas including class actions, securities, extraordinary remedies, fraud and white-collar crime, and cross-border matters. “Practice areas, which have a more concentrated focus than practice groups, bring together individuals with a community of interest who can market from a client-facing perspective and offer something beyond a ‘we're great litigators' approach,” Ranking says.
In a crowded legal market, differentiation is mandatory. “You can't just go with a general approach to marketing anymore,” Ranking says. “Nowadays everyone and their mother can claim to be a great litigator.”
But there's a problem with specializing too early. “It's hard for junior associates to get up on their feet if they're working in narrow areas that require deep expertise,” Melchers says.
The solution may be to keep things in balance. “We try to maintain an equilibrium between people who have a niche and people who don't, because we will always need individuals who can run with the ball in any arena,” Melchers says. “On the other hand, when areas like P3s and restructuring are hot, you can't just credibly position yourself as an expert overnight.”
Melchers believes that the first three years should afford associates a generalized experience. “It allows them to find out what they like and are good at, and also to engage the partners with whom they have affinities,” she says. “After three years, we try to direct to them the work that they prefer.”
Ranking believes, however, that his idea of creating “practice areas” allows associates to have the best of both worlds. “The practice areas are non-exclusive, and associates as well as partners can join one or more,” he says. “So they can maintain the general practice we expect from them in the first few years even while they have access to mentoring and opportunities in specialty areas.”
It's clear that no one has all the answers.
Consider, for example, the issues around the appropriate size of litigation teams. The dichotomy of opinion is stark. Cruz, for one, believes – somewhat counterintuitively – that litigation teams will tend to have more members than they have had in the past. “You want to have as many people working at different rates as you can,” he says. “If the team's working well, everyone should be doing appropriate work for their billing rate at all times, which means the system should fit in well with alternative billing arrangements such as fixed fees.”
Jack disagrees. “I think that team structures will have to be more efficient, which probably means fewer people, but with very clearly defined roles,” he says.
And then there's the middle view. “I don't think staffing is going to change all that much,” Byers says. “What's changed is the heightened requirements for explaining the staffing and the strategy to the client.”
What hasn't changed, apparently, is litigators' inability to agree on anything. Fortunately for the future of their practices, they also continue to ask the important questions.
Once an advocate, always an advocate. No heresy there.
Julius Melnitzer is a Toronto-based legal-affairs writer.
But times have changed. “Being a pure advocate just doesn't cut it with clients anymore,” says Paul Morrison, a senior partner in the litigation group of McCarthy Tétrault LLP.
And even the most adamant of traditional counsel will admit that winning isn't everything in today's environment. Some might even concede that winning isn't always the most desirable of outcomes for their clients. “A frequent cause of litigation breaking down is the failure of counsel to explain the full cost and strategic consequences not only of failure, but also of success in the sense of ‘winning' the case,” says Geoffrey Cowper, QC, national head of Fasken Martineau DuMoulin LLP's litigation department.
There are corollaries to these heresies. One can be found in the skepticism that now greets the marketing maxim “If you do good work, you'll get good work,” attributed to the legendary James McRuer, former Chief Justice of Ontario.
“It serves the superstars well,” according to one of the industry's veteran counsel. “But how many Earl Cherniaks [of Lerners LLP] do you see out there?”
For the great unwashed, then, developing marketing skills is essential. “If you're a litigator who wants to be a partner, you better have a strategy of practice development,” says David Byers, who heads Stikeman Elliott LLP's litigation group.
It's not that excellent advocacy skills aren't a requirement, it's just that having those skills is in and of itself no guarantee of success in a world where business solutions and efficiency drive the litigation bus.
“Attracting and growing great advocates was enough to maintain and build a top-flight litigation department or boutique 20 years ago,” says Linda Plumpton, a Torys LLP partner and former head of the firm's litigation department. “That's not the case now.”
Instead, strategic thinking, client communication, case-management skills and team-building sensitivities combine with advocacy expertise to form the head and heart of today's successful business litigation counsel.
“The most successful litigators these days are the ones who not only have the necessary forensic skills at clutch time, but can also manage large and complex cases, of which the vast majority will never get to trial,” says Glen Poelman, Chair of Macleod Dixon LLP's Litigation Practice Group. “That means managing teams composed of lawyers, paralegals, experts and consultants, and usually a core body of client representatives or witnesses — all the while keeping the big picture in focus and not letting cases take on a life of their own.”
Even junior associates will have to learn management skills at an early stage. “Clients are prepared to accept less hands-on control. So instead of doing basic tasks, associates will be responsible for managing the third-party providers who are doing the jobs they used to do,” Plumpton says.
Effective project management, then, is clearly a big part of the solution to the value equation clients are seeking. But the degree to which that will entail a reliance on outsourcing – in the sense of sending work normally done by lawyers, such as document review, to third-party providers – remains to be seen.
“The trouble with outsourcing is that you don't end up having someone in-house who has put their head around the documents,” says Robert Staley, Co-Chair of Bennett Jones LLP's litigation department. “On the other hand, there are cases we would outsource if we had to do it again.”
Arguably, then, whether to outsource or not boils down to communication and judgment, two important components of the skill set today's litigators need.
“Outsourcing is not a one-size-fits-all solution,” says Crawford Smith, who heads of Torys' litigation department. “But law firms need to have relationships in place so they can provide their clients with options.”
That suits Darryl Cruz, who is the leader of McCarthy Tétrault's Litigation Practice Group, just fine. “I definitely think we're heading to a much heavier reliance on outsourcing,” he says.
“It emphasizes our view of ourselves as sophisticated advisors on complex matters, and it turns our associates from assembly-line widget makers who read every single document into project managers who understand what's important in the
documents.”
Cruz also believes that moving to outsourcing will have a positive impact on associate retention ratios. “Outsourcing isn't just a response to client pressure,” he says. “It's also there because the work outsourcers do is not enjoyable for the army of associates who have had to endure mind-numbing tasks they don't want to do. On the other hand, having strong project skills can turn their participation in litigation closer to the exciting endeavour it can be.”
Having said all of this, outsourcing – touted in many circles as the solution to the bottom-heavy dilemma law firms are said to be facing – is hardly the flavour of the day among most Canadian litigation firms. Rather, the prevailing approach appears to be a cautious one that suggests outsourcing is only one small part of the overall response to clients' demands for greater efficiencies. Indeed, many firms appear to see contract lawyers as an even better solution.
At Macleod Dixon, for example, outsourcing really isn't on the radar screen. “We have not done any outsourcing, nor do we currently have plans to do so,” Poelman says. “Very occasionally, the pressure of large project files has led us to take on contract lawyers, but that is as far as we have gone outside of the usual student, associate and partner mix.”
The approach taken by Borden Ladner Gervais LLP is similar. “If by outsourcing you mean sending legal work to be done outside the firm, we do not do that,” says Ira Nishisato, National Leader of BLG's Commercial Litigation Practice Group. “On a number of occasions we have hired contract lawyers known to us to assist with major document review projects, and this has proven to be an effective way of delivering value to our client. We also work with outside vendors on e-discovery and computer forensic services.”
Nor has Osler, Hoskin & Harcourt LLP wholeheartedly embraced the outsourcing concept yet. “We continue to examine outsourcing opportunities,” says Larry Lowenstein, Chair of the Osler Litigation Department. “For scanning and coding production, we work with specialist outside providers. We have also identified some quality lawyers whom we hire on a contract basis to perform specified tasks under our supervision, like initial document review.”
Byers at Stikeman Elliott seems somewhat less cautious: “We look for efficiencies in discovery that may involve outsourcing aspects of the discovery process.” Meanwhile, Ogilvy Renault LLP uses “consultants” for e-discovery, but again in a limited way. “We have used consultants to set up and maintain databases to manage evidence that is available in electronic format, depending on the sheer size of the electronic evidence to be reviewed,” advises Sophie Melchers, head of the firm's Montréal litigation group.
For its part, Torys seems ready, willing and able. “We have developed relationships with a number of firms that allow us to respond to clients' needs and the demands created by their cases,” says Smith of Torys. “These relationships include outsourcing e-discovery in varying degrees, hiring contract lawyers and, if need be, project managers.”
Cassels Brock & Blackwell LLP is outsourcing e-discovery, and McCarthy Tétrault appears to have considerable experience with the practice. “We have outsourced large document projects to vendors specializing in those services and we have used contract lawyers on those projects,” Cruz says. “We have not outsourced other legal work and do not intend to do so.”
And where are Canadian firms directing their outsourcing? For the most part, “Buy Canadian” appears to be the comfort zone for the country's law firms. “There are numerous litigation support companies in Canada that provide assistance with e-discovery and large document reviews,” Cruz says. “We have not outsourced overseas and our present preference, if outsourcing is required, is to use local companies with experience in Canadian e-discovery.”
That's not to say some outsourcing doesn't go offshore. “Largely, the firms are domestic, although we have worked on matters where work has been outsourced offshore to places like India,” says Torys' Smith.
Still, as Poelman points out, case management – whether in the form of outsourcing or otherwise – is fine as far as it goes, but only if the managers keep the big picture in focus.
Which leads to the next question: what's the big picture?
“It's all about understanding the business, appreciating the organization's tolerance for risk, and bringing creativity and innovation to the process,” says Susan Rabkin, VP and General Counsel for North America at InBev and Labatt.
In practical terms, this means that prevention, risk assessment, damage control, cost, end-of-the-day liability and survival are all at the forefront of clients' thinking. “As clients become more sophisticated in identifying potential disputes, they're consulting us earlier than they used to,” says Gerald Ranking, Chair of Fasken Martineau's Ontario litigation department.
“Increasingly, litigation counsel find themselves in the position of trusted business advisor who will preserve a client's money and reputation.”
Mark Evans of Fraser Milner Casgrain LLP (FMC) says that clients have moved from reacting to claims to seeking advice and options to avoid the claims in the first place. “It's not that clients have no need for the litigation department's traditional role of effective advocacy,” Evans says. “It's just that a full-service litigation department is no longer servicing clients properly if its lawyers don't play a proactive role as well. Think of it as putting ‘counsel' back into the term.”
Put another way, it's the client's risk tolerance that governs, not that of the lawyer. “You cannot overwork a file to satisfy your own neurotic needs,” Lowenstein says. That's because cost invariably factors into the equation for both the client, who must consider the outlay, and for the law firm, where time that can't be billed doesn't do much for profitability. And while there's certainly truth in the old cliché that cost and value are different things, it's also true that cost can factor significantly into a client's perception of value.
“Gone are the days when clients come to you with a $100-million or even a $1-billion lawsuit and your instructions are, ‘Do what you have to do,'” Ranking says.
So while the name of the game is still litigation, the orientation is far broader than it was in the past. “Clients are not looking for trial skills and they're not looking for dispute-resolution skills,” says no less an authority than Glenn Smith, a founding partner of litigation boutique Lenczner Slaght Royce Smith Griffin LLP. “They want proactive risk management and they want people who can keep them as far away from a courtroom as possible. People who want a trial are fewer and farther between every single day.”
And that thought brings forth another near heresy: “If being right in the law doesn't effect a business solution, then being right in the law is just one of the spokes in the wheel of what lawyers must provide to their clients these days,” says Geoffrey Shaw, who leads Cassels Brock's litigation practice. In other words, there are only so many situations that warrant running up hours to research the law in New Zealand.
“What it amounts to is that we're still looking for those people who have the best judgment about what to do in a case,” Byers says. “A lot of the other aspects of the job can be taught and learned, but judgment is innate.”
On the other hand, the degree to which client development can be taught and learned may still be open to question. What's not open to question is that, for a litigation department or boutique to survive, a succession plan must be in place.
“Having all the advocacy and case-management skills in the world is not enough these days,” Lenczner Slaght's Smith says. “Associates still have to be responsible for building their own practice if they have partnership aspirations.” The firm's job is to inculcate associates “in year one” with what it takes to be a partner. “What that involves is bringing in trainers and consultants who can teach our associates how to develop relationships and how to be valuable to clients,” he says.
The upshot, of course, is that maintaining and building a litigation department in today's environment has become a complicated endeavour, and one that engages two critical functions: ensuring that team members have the skill sets required to service clients and attract new ones, as well as staffing files with the appropriate combination of experience, expertise and outsourced resources.
“Providing value to clients means that firms will have to devote more energy to picking the right people in terms of expertise and experience when they're staffing files,” says Don Jack of Heenan Blaikie LLP.
Firms must also ensure that those chosen to play the game want to play with each other. But teamwork, whether with clients or colleagues, isn't part of lawyers' training. “Law school is for the most part an individual experience, except for things like mooting, where students work in groups,” Cruz says. “Contrast that with MBA school, where students work in teams from the moment they start. Law school doesn't prepare lawyers for working with other people, communicating with them or managing their expectations.”
Picking the right people for a team, of course, means having the right people to start with. “The recruiting focus used to be on individual brilliance in terms of legal thinking and analysis,” Cruz says. “Now we're looking for other competencies, such as business acumen, the ability to be a team player and leadership qualities — non-traditional criteria of the kind that behavioural interviewing reveals.”
Nor are these non-traditional criteria optional. “We recognize that the people who succeed are not only the ones who can rip a witness apart,” Poelman says. “We're looking for individuals with wide-ranging people skills who don't inadvertently create adversarial situations when they're not warranted. Instead of one-dimensional pit bulls, we're looking for balance, intelligence and the ability to keep a file moving in a way that allows the client to see an end in sight.”
Cruz agrees. “Clients aren't interested in brilliant advocates who have a million ideas and provide excellent service if these qualities are going to cost too much,” he says. “They want lawyers with strong project skills.”
Determining which litigators will develop into the “right kind of people,” however, has made the business of recruitment complicated. “We spend a great deal of time on client-centred recruiting,” says Evans at FMC, “but it is a challenge to find bright, capable people who can fill the multi-faceted skill set that's required.”
Ogilvy's Melchers concedes there's a lot of intuition involved. “Ten or 12 years ago, we paid a lot of attention to grades in particular courses,” she says. “Now I'm looking for that special spark that provokes me to want to work with an individual, because I'm fairly confident that clients will feel the same way. It's a spark that says, ‘I can trust you, I know you can run with the ball and I know you'll get back to me.'”
Shaw agrees: “I'm looking for something indefinable that tells me the person I'm interviewing has that certain je ne sais quoi.”
Training looms larger than ever in ensuring a litigation department's healthy development. “In my view, the recruiting focus has not changed,” Byers says. “It's the way we train our lawyers and what we train them in that's changed.”
BLG's Nishisato has a similar view. “We have not changed our recruitment criteria or our process,” he says. “But our internal training programs place much greater emphasis on efficiencies and cost effectiveness in running files.” Which is not to say that firms are neglecting traditional training. “Because we have priced so much litigation out of existence, most files tend to be very large projects that give associates little exposure to trial and examination skills,” Poelman says.
Cassels Brock's Shaw says advocacy training is the “$64,000 question” for litigation departments.
“More and more of the experience that associates are getting is not training by fire,” he says. “That's why we do secondments to Eddie Greenspan's office. Although criminal law isn't an area we practise in, it does provide greater opportunities for getting associates into a courtroom.”
Creating opportunities for associates to get on their feet where the opportunities might not otherwise exist, then, is de rigueur at many firms.
“We do try to find niches on even the largest cases where we can give associates opportunity to handle witnesses,” Poelman says. “We also encourage participation in the week-long trial-advocacy programs put together by law schools and law societies.”
For its part, Bennett Jones takes on files for the purpose of giving associates “on your feet” experience. “We have made a conscious decision to take on lesser dollar-value files so our juniors can get that experience,” Staley says. “Pro bono work is also an excellent training ground, as are arbitration and tribunal work.”
Blake, Cassels & Graydon LLP has invested heavily in internal training programs and fostered an extensive pro bono program. “We also encourage our associates to join The Advocates' Society and other professional groups, and we're involved in the small-claims courts where our associates act as duty counsel,” says Jeff Galway, the Litigation Group Co-ordinator for the firm's Toronto office.
Here, the encouragement of clients can be heartening. “Clients want us to be doing this work and have strongly supported our partnership with organizations like Pro Bono Law Ontario and the Canadian Civil Liberties Association,” Lowenstein says. “The Royal Bank has even gone so far as to waive any conflicts that arise from pro bono work.”
Assuming, then, that the appropriate skill sets populate a firm's litigation department, how should those skill sets be distributed? What should the ratio of junior to mid-level to senior associates be? What about the ratio of junior, mid-level and senior partners? And, for that matter, what about the overall ratio of partners to associates?
“Our pyramid is not optimal because I think that the bet-the-company litigation we attract requires that we have people at every level, more younger lawyers, and a higher ratio of associates to partners,” Melchers explains. “The firms should just take the hit for the younger lawyers' training because no client should pay for that. It's already common practice to write off learning curve time.”
While Lowenstein agrees that clients should not pay for associates' education, he believes that the cost of training will impact the pyramid. “I just don't believe that litigation departments can continue to be as bottom-heavy as they are now,” he says.
But there are telling signs so far that outsourcing will not significantly impact the demand for junior litigation associates. To begin with, as detailed previously, Canadian firms' cautious approach to outsourcing indicates that significant change is a ways off; secondly, most major Canadian firms foresee no changes to their departmental hiring practices as a result of evolving client demands; and thirdly, most major firms don't see the need for major organizational changes in their litigation departments.
“The problem with the thinking that firms are too bottom-heavy is that clients appreciate deep bench strength when the big cases come up — especially in an era of e-discovery, which requires more junior staff,” Staley notes.
Of all the firms mentioned in this article, none indicated that they intend or foresee any change in their associate hiring practices. “We hired our usual complement in 2009 and expect to do so again in 2010,” says McCarthy Tétrault's Cruz, echoing the general response.
What's more likely to happen is that the promotion process will become more selective, as evidenced by the trend to merit-based as opposed to lockstep compensation for associates. “The new paradigm for litigation departments has created opportunities for top associates who can do the work at a lower rate than partners,” Nishisato says.
In other words, the pyramid may get broader near the bottom and narrower near the top. “There's an element of Darwinian process through the associate ranks, so people who have the gift of getting right to the issue and communicating with the clients won't be faced with big write-offs throughout their careers,” Lowenstein says. “Their efficiency will be wrung out earlier than it is now. A new accountability will replace the bureaucracy without a face that exists today, and entrepreneurship will be rewarded with promotion.”
Otherwise, none of the firms interviewed for this article planned major organizational changes in response to the changing legal market environment. Indeed, most firms believe they are nimble enough to adapt quickly to changing market conditions and client needs.
That's not to say that more fundamental changes are not on the horizon. “We have not changed the structure of our group directly,” Cruz says. “But as the prevailing forces continue to build, we will undoubtedly have to consider our optimum size and structure.”
Meanwhile, it's not as if things aren't changing within the existing structures. Most commonly, firms continue to search for efficiencies in knowledge management and technology. McCarthy Tétrault has created a significant litigation support group to deal with e-discovery and has invested heavily in project-management resources.
What does appear to have changed significantly, however, is a growing emphasis on specialization and the creation of sub-specialties within litigation departments. “There's much more specialization as time goes on,” Byers says.
Torys, for example, has developed intellectual-property and broker-dealer litigation sub-specialties; Cassels Brock is promoting client, industry and multi-disciplinary teams where feasible; and BLG has created nine focus groups within the commercial litigation department.
“Law firms have had no choice but to create specializations that mirror the demands of clients and the industries in which they operate,” Nishisato explains. “Clients want the expertise that specialization creates and they want lawyers who can immerse themselves in the industries with which their practices are associated.”
But specialization can also drive marketing and client development. “Specialization allows lawyers to make names for themselves much faster,” Byers says.
To this end, Ranking, who assumed the leadership of Fasken Martineau's Ontario litigation department a year ago, has fostered the concept of practice areas including class actions, securities, extraordinary remedies, fraud and white-collar crime, and cross-border matters. “Practice areas, which have a more concentrated focus than practice groups, bring together individuals with a community of interest who can market from a client-facing perspective and offer something beyond a ‘we're great litigators' approach,” Ranking says.
In a crowded legal market, differentiation is mandatory. “You can't just go with a general approach to marketing anymore,” Ranking says. “Nowadays everyone and their mother can claim to be a great litigator.”
But there's a problem with specializing too early. “It's hard for junior associates to get up on their feet if they're working in narrow areas that require deep expertise,” Melchers says.
The solution may be to keep things in balance. “We try to maintain an equilibrium between people who have a niche and people who don't, because we will always need individuals who can run with the ball in any arena,” Melchers says. “On the other hand, when areas like P3s and restructuring are hot, you can't just credibly position yourself as an expert overnight.”
Melchers believes that the first three years should afford associates a generalized experience. “It allows them to find out what they like and are good at, and also to engage the partners with whom they have affinities,” she says. “After three years, we try to direct to them the work that they prefer.”
Ranking believes, however, that his idea of creating “practice areas” allows associates to have the best of both worlds. “The practice areas are non-exclusive, and associates as well as partners can join one or more,” he says. “So they can maintain the general practice we expect from them in the first few years even while they have access to mentoring and opportunities in specialty areas.”
It's clear that no one has all the answers.
Consider, for example, the issues around the appropriate size of litigation teams. The dichotomy of opinion is stark. Cruz, for one, believes – somewhat counterintuitively – that litigation teams will tend to have more members than they have had in the past. “You want to have as many people working at different rates as you can,” he says. “If the team's working well, everyone should be doing appropriate work for their billing rate at all times, which means the system should fit in well with alternative billing arrangements such as fixed fees.”
Jack disagrees. “I think that team structures will have to be more efficient, which probably means fewer people, but with very clearly defined roles,” he says.
And then there's the middle view. “I don't think staffing is going to change all that much,” Byers says. “What's changed is the heightened requirements for explaining the staffing and the strategy to the client.”
What hasn't changed, apparently, is litigators' inability to agree on anything. Fortunately for the future of their practices, they also continue to ask the important questions.
Once an advocate, always an advocate. No heresy there.
Julius Melnitzer is a Toronto-based legal-affairs writer.
