Husch Blackwell Sanders is doing fine so far this fiscal year, co-chairman David Fenley says, but he attaches a caveat to the statement: “A first quarter doesn’t make a year.” Sandberg, Phoenix & von Gontard managing partner Michael Forster echoes Fenley’s careful wording, saying the firm is “pretty much on budget, but we’re cautious.” The consensus among many of the MOney 20 law firm managers is that fiscal 2008 will be a tougher year than 2007, despite the conventional wisdom that says the legal business is recession-proof. The firms are adjusting by building those practices that do well in an economic slowdown, including bankruptcy, or that show continuing growth despite the harder times, such as intellectual property.
Bryan Cave, the biggest MOney firm, added a couple of bankruptcy attorneys over the last year and is continuing to add to its intellectual property practice, said chairman Don Lents.
“Our expectations are similar to those of almost everybody in the profession: We will not see the same kind of growth this year that we saw last year,” Lents said.
Polsinelli Shalton Flanigan Suelthaus announced in May that it opened an office in Wilmington, Del., with a bankruptcy and restructuring focus. The firm saw some slowdown in some practices, such as financing late in fiscal 2007 that was offset by growth in others, including intellectual property and litigation, said chairman Russ Welsh.
Gallop, Johnson & Neuman, which ranks 16th on the MOney list with $26 million in revenue, also is adding intellectual property attorneys as real estate practices slowed. Transactional work still is very robust and litigation has been very busy, said managing partner Tom Campbell.
“We’re doing things this year that should be done every year or every couple of years regardless of the economy,” such as looking at how to be cost effective, he said.
“You really shouldn’t wait until the economy softens to look at those kinds of things,” Campbell said.
Other firms don’t see the need to make adjustments, including Kansas City litigation defense specialist Baker Sterchi Cowden & Rice.
“Whereas transactional lawyers may see a falloff in their work because of the economy, in litigation sometimes the opposite is true,” said chairman Tom Sterchi. “In prosperous times people don’t sue as much.”