TMG's Take... on The Revolving Door
A perspective on legal management issues from The McCormick Group.

As is the case in any change in administration, there will be a major reshuffling of attorneys, particularly in the Washington area, going in and out of government. This time, those shifts are coinciding with a major economic recession that, with nearly daily reports of attorney layoffs at major law firms, has hit the legal industry hard.

We’re already starting to see a hesitancy to bring in laterals at the partner level, except in those slam-dunk situations where there is significant “portable” business in tow. And, of course, government lawyers have no portables. While fiscal caution is obviously necessary in these uncertain times, a negative attitude towards those coming out of the administration (or off the Hill) might be short-sighted. Recall that in the last change of administration, Wilmer Cutler & Pickering (now Wilmer Hale) virtually cornered the market for top-level government recruits. Eight years later, does anyone seriously question the wisdom of bringing in the likes of Seth Waxman, Jamie Gorelick, Charlene Barshefsky, and Howard Shapiro? Not only did the firm acquire some impressive talent, but it also generated the kind of buzz that helped attract other laterals.

These are tough times indeed. But all the demographics point out that the war for talent will continue, and a short-term, purely bottom-line look at the top lawyers coming out of the government may be detrimental to a firm’s future. That’s particularly true, since the whole concept of portable business is somewhat illusory anyway (see the comments of Dewey & LeBoeuf chair Stephen Davis in Learning from Past Mistakes in Hiring Laterals (Law Firm Inc, May/June 2008, p.24).

We are likely to see major government initiatives in areas such as financial services, healthcare, and energy. Lawyers with recent experience in those areas will have a leg up as business interests face challenges influencing government policy. Let’s also not ignore the fact that many firms will lose some of their biggest stars to the Obama Administration. Hiring top-flight government lawyers will not only help fill critical needs caused by these departures, but will also provide opportunities to extend or expand client relationships, particularly if those lawyers bring expertise in areas facing major governmental restructuring like financial services, health care, and energy. In these times, firms have to make sure that governmental laterals will eventually add to the bottom line, but ahead-in-the-sand attitude concerning “no portable business” will be self-defeating.

TMG's Take is a regular e-mail advisory produced by The McCormick Group. The company's Law & Government Affairs and Law Firm Services groups combine the expertise of more than 15 Consultants to help law firms fulfill all of their lawyer and administrative recruiting needs. TMG's Take covers topics across the spectrum of law firm management, including associate and partner compensation, growth strategies, marketing and business development, operations and facilities management, finance and accounting, professional development, and technology. Please direct all inquiries to Steve Nelson, Managing Principal, at 703.841.1700 or snelson@tmg-dc.com.