Law School Firms

A post-graduate law firm is an attractive idea. Recent graduates could develop skills under the supervision of more senior lawyers. The firm could provide secure placement for at least part of a school’s graduating class. And, if the firm charged low prices for the recent graduates’ services, middle-income clients might secure needed legal representation. Benefits like these are prompting some law schools to consider creating law firms associated with the school.

The idea parallels medical residencies, which provide hands-on training to all doctors. Most of those residencies occur in teaching hospitals linked to medical schools, a connection that offers a smoother, more rational path from classroom to practice than the legal profession currently offers.

Law schools exploring the creation of affiliated firms, however, readily acknowledge that the medical profession has a key asset lacking in law: private and government insurance underwrite a large portion of medical care. Teaching hospitals don’t have to chase ambulances looking for clients; the ambulances come to them–along with insurance money to pay for the patient’s care.

Establishing a client base is one of the biggest hurdles that post-graduate law firms must overcome. Arizona State’s Sandra Day O’Connor College of Law, which will launch a post-graduate firm this summer, plans to draw some business from other university initiatives. The ASU “Alumni Law Group,” for example, will work with start-up companies nurtured by ASU’s innovation center and with nonprofits assisted by its nonprofit center. The firm will also reach out to veterans and the Hispanic community.

The ASU business plan contemplates charging $125 per hour rather than the $250 per hour billed by other firms in the area. One question is whether that discount will be sufficient to draw sufficient clients to the firm. And if it is, will the firm draw work away from existing firms (including other ASU alumni) or will it tap new clients?

The University of Utah’s S.J. Quinney College of Law follows a different business model. Utah’s “University Law Group,” founded in November 2011, charges just $50 per hour and focuses on providing basic services to low- and mid-income families. Even at that rate, the project has had some difficulty building a client base. Dennis Gladwell, a retired BigLaw partner who supervises Utah’s University Law Group, notes that local firms have not referred smaller cases to the Law Group.

For law schools exploring creation of a post-graduate law firm, there are at least two indispensable references. One is an article by Bradley Borden and Robert Rhee, outlining the concept of a law school firm. The other is a report prepared by Hanover Research on programs that help law graduates transition to solo practice. That report focuses on solo incubators, but offers some information about post-graduate firms.

I’m intrigued by the concept of law school firms, and hope others will offer their insights. Here are two thoughts to start the discussion. First, I think these firms offer the most promise if they tap new client markets. Small businesses, as well as low- and mid-income individuals, have unaddressed legal needs. If we can respond to those needs, that’s a win-win-win for law schools and the legal profession: We would ameliorate a longstanding problem in our justice system, offer better training for new lawyers, and avoid the specter of simply shuffling legal business from one graduate to another. Indeed, if law schools can not find new client markets to tap, then we have to face the fact that we are graduating far too many lawyers.

Second, to tap those markets, I think law school firms need to re-think existing practice structures. We need to think hard about which tasks demand a senior lawyer’s attention, which ones can be handled by new graduates, and which ones can be completed by law students, paralegals, or computers. Creating a law firm in which graduates perform customized tasks for clients won’t prepare those lawyers for the way most law will be practiced in the twenty-first century. Nor will it allow those lawyers to support themselves by serving a low- or mid-income client base.

Despite the many challenges to establishing a post-graduate law firm, law schools have one advantage: We have access to an employee base that ranges from college students interested in exploring law practice, through law students, recent graduates, and experienced alumni. Can we use those personnel to create logical, efficient, and economical systems for handling legal problems? Could we, for example, use college interns and 1Ls for some paralegal and clerical tasks; trained 2Ls for some intake; 3Ls with licenses for basic legal work; residents for more advanced work; and supervising attorneys for more complex matters–with each level supervising the one below it?

We could add to this mix professors and practitioners willing to offer workshops or instructional materials to the public. Those efforts, like Houston’s Peoples Law School, would perform a public service and perhaps also draw clients. The post-graduate firm could also connect to alumni practitioners, referring to them cases that exceed the firm’s capabilities.

If we can design practice structures of this type, I think a post-graduate law school would have the best chance of achieving all of its goals. And, by bringing schools and practitioners together, it might help us create more efficient methods of delivering legal services.

Perspectives:

Describing “Law School Firm” Jobs

Professor Kevin Outterson wrote a letter to Barry Currier, Interim Consultant on Legal Education at the ABA Section of Legal Education outlining his concerns about law school firms.

Captive Firms and Jobs

Kyle and Kevin raise some important issues about law school firms. I welcome the chance to continue this conversation, and invite others to join as well. The comments are always open and, if you’d like to write a longer perspective, just email me at merritt52@osu.edu and I can set that up. Meanwhile, here are some of my thoughts on how law school firms might affect counting jobs, creating jobs, and providing legal services.

  • Jack Graves

    I wonder if the dental school model might provide a better analogy, as one in which the student dentist cannot necessarily rely on dental insurance to pay for her services, but competes to a large degree on price (at least that’s my limited understanding). I believe that competent legal services, efficiently delivered at a reasonable price (preferably NOT based on a billable hour model), would easily unearth markets for those services. The bigger problem is the resistance of many members of the local bar. At least, that’s the reason given by those within the academy who remain resistant to the “law school, as law firm” model. I suspect, however, that the idea can find greater support within the local bar to the extent that (1) the local bar plays a key role in its execution; and (2) it is seen as doing more to develop new markets for legal services than cannibalizing existing work from existing lawyers.

    I also believe that the revenue generated from work done by law students can be helpful in subsidizing the cost of the students’ practical legal education, thereby reducing the cost of tuition. Again, my understanding is that this is the approach used in the dental school model. Student tuition is reduced, because a part of the cost of delivering a practical dental education is offset by revenue generated by student serving patients. Practical legal education is the most expensive (and arguably most important) part of what we do, as law schools, and we could take a serious bite out of out excessive tuition rates if we could effectively subsidize this educational element with revenue generated by the students.

    • DeborahMerritt

      Jack, this is very interesting–I do think we should think more about the dental school model. I talked with a group of dental educators a few years ago and was impressed by the extent to which their program integrated well supervised and staged practice with rigorous theory. I want to go back to them for more.info on that. (By coincidence, I will be “in the chair” on Tuesday–perhaps I’ll start the conversation then.)

      I also agree that both educators and practitioners have worried too much about the competition issue. It clearly is an issue if there is no untapped demand. But if that’s the case, as I suggest above, law schools that have to confront that issue head on and with sober thinking. Meanwhile, if we can develop appropriate models–working with the bar–I think we can gain support from at least some bar leaders. Here in Columbus, for example, the local bar association took the lead in creating an incubator program. In that case, they reached out to the law schools for some input. We could take the same model in reverse.