Adam Smith's Home Town

If you've never been to Edinburgh, I highly commend it to you.  And that's not just because of the Adam Smith connections, although that's what I'll very briefly mention here.

We're staying about 200 yards down the Royal Mile from Adam Smith's new statue, unveiled 4 July 2008, and about 400 yards up from his gravesite in the Canondale Kirk yard.  The statue is bronze, 10' tall, and prominently situated in front of St. Giles church, Behind him is a plough, said to symbolize the impact of his thinking on the eclipse of agrarian economies, and to his right is a beehive, symbolizing, of course, the invisible hand of unguided individual effort creating without a centralized authority something greater than the sum of the individuals alone.

"The Media & The Legal Profession:" Panel at Georgetown Law

If you'll be in Washington, DC this coming Tuesday, March 3rd, yours truly will be moderating a panel scheduled to run from 11:45 am — 1:30 pm on "The Media & The Legal Profession," at a conference sponsored by Georgetown Law's "Center for the Study of the Legal Profession."  My fellow panel members will be Aric Press, editor in chief of The American Lawyer, David Lat of Above The Law, Susan Jacobsen of the Association of Corporate Counsel, and Jose Cunningham, Chief Marketing and Business Development Officer of Crowell & Moring.

More info here.

Admission is free but registration is required.

It would be great to see you there, and it promises to be an interesting panel.

Report to Readers

Periodically, I feel it incumbent upon myself to report to you, Dear Reader, my indispensable audience, on what I know about the "Adam Smith, Esq." community.

So, based on reader surveys and stats logs from my hosting company, and without further ado:

• 73% of you are in the US, 27% of you not.
  • The leading non-US countries, in order of readership, are the UK, Canada, Australia, and Hong Kong. After that it's anyone's bet, including one reader (self-reported) in Kazakhstan.
• About 30% of you are in AmLaw 100.
• About 55% of you are in the AmLaw 200.
• General counsel are a minute readership: < 1%.
• Most of the rest of you are:
  • Staff or other "non-lawyers" in law firms,
  • law professors,
  • law students,
  • the media, and
  • "non-law."
• About 30% of you are associates.
• About 22% of you are partners (and compare those proportions to the real world: "Adam Smith, Esq." skews towards partners).
• Among partners, a disproportionate percentage of you are on the management/executive committee
• Among people on the management/executive committee, a disproportionate percentage of you are managing partners.

So that's your profile.

A few other facts about the "Adam Smith, Esq." profile:

• I started the site at the very end of 2003.
• There are now nearly 1,000 articles (you'll hear about it when we hit that milestone).
  • And yes, I write every single word myself--with the obvious exception of guest columns, which you can count on the fingers of one hand.
• Site traffic is about a third of a million page-views per month: A recent low might be 310,000, and a recent high might be 360,000, but a third of a million seems a fair approximation.
• About 3,000 of you subscribe to my monthly email newsletter.

So concludes the report to readers.

Except for one last all-important question: What would you like to see more or less or different coverage of?

Please let me know. And rest assured that the editor and publisher is always in.

London This Week

I'll be leaving for London tonight and spending all week there—back next Saturday the 24th.  Among the firms I'll be visiting will be a number of the usual suspects including most of the Magic Circle.

Although I was just over there early last month, at the pace things seem to be changing I'm very interested to see whether the mood has perceptibly changed.  Look for a full report.

Happy 2009

This is actually a new-for-2009 Waterford crystal ball, approximately 10 feet in diameter, weighing over 12,000 pounds, covered with 2,668 crystal triangles, and illuminated by more than 32,000 LEDs.  Happy big bad bright New Year.

Actually, Dear Reader, I imagine many of you, as I, will be just as pleased to kiss 2008 goodbye:

• The Dow ended the year down 33.8%, its worst annual showing since 1931--and 28 of the 30 stocks (all but Wal-Mart and McDonalds) were down by more than 10%;
• The more representative S&P 500 was down 38.5%;
• The famously tech-centric NASDAQ was down 40.5%;
• The small-stock Russell 2000 was down 34.8%;
• The FTSE 100 declined 30.9% on the year, its worst annual drop since it was created nearly 25 years ago;
• Nearly $7-trillion in US wealth has been wiped out, erasing all the stock market gains of the past six years;
• There was no place to hide abroad either, with the "BRIC" stock markets down from 55% to 72%;
• Commodities such as oil and copper have crashed, and the Reuters-Jefferies CRB index, which first began tracking a basket of commodity prices in 1956, will be down nearly 40%, an all-time record annual decline, while the S&P FSCI index, another benchmark for commodity investors, was down over 50%;
• And of course the US housing market is in a famous and now nearly theatrical swoon, with median prices (there is of course no such thing as a "median" housing market) down by about 14%, by all accounts the largest decline nationwide since the Great Depression;
• Wall Street as we knew it (Bear Stearns, Lehman Brothers, Merrill Lynch, and Morgan Stanley and Goldman Sachs in their own ways) went away;
• Not to mention Heller Ehrman, Thacher Proffitt, and Thelen Reid, plus countless layoffs and pay and bonus freezes in our little corner of the world.

What, then, are my wishes for you for 2009?

As I've written fairly consistently this year, try to put these events all in perspective.  You are not your net worth or your income, and if both have returned to 2002 or 2003 levels, the world has not, actually, come to an end.

Nevertheless, an array of forces that have heretofore seemed rather randomly aligned, disconnected from one another, and more imaginary than real, may—emphasis on may—be assembling for the first time into something recognizable and coherent, although still, at the moment, of little real impact.  I don't know if this is, or will be, true, and I don't know of any way of thinking about it harder or looking for more data to tell if it will be true.

I can promise to you, however, Dear Reader, that in 2009 my fervent hope and commitment will be to continuing to make "Adam Smith, Esq." a place where everyone who cares so deeply about our industry and our profession can assemble to help figure these things out—and change them for the better.

Happy Big Bad Bright 2009.

Merry Christmas

Rockefeller Center, Christmas 2008
Photograph by Bruce MacEwen

Greetings from London

I'm here in The City for the week, having arrived Sunday morning and going home to New York Thursday evening.  The purpose is essentially a series of meetings with various firms I'm having with my partners Ward Bower and Tony Williams, but that doesn't mean I haven't been able to enjoy a few sorties to The National Gallery and the British Museum. 

As I never tire of New York, I never tire of London.  And I'll be back, by the way, the third week of January, so let me know if you're here and might like to get together then.

Royal  Inns of Court

A Short Tour of 225 Years

1787: US Constitution, Article I, Section 2:

Representatives ... shall be apportioned among the several States which may be included within this Union, according to their respective Numbers, which shall be determined by adding to the whole Number of free Persons, ... three fifths of all other Persons.

1865: US Constitution, Amendment XIII:

Neither slavery nor involuntary servitude, except as a punishment for crime whereof the party shall have been duly convicted, shall exist within the United States, or any place subject to their jurisdiction.

1865: US Constitution, Amendment XIV:

Section 1. All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the state wherein they reside. No state shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any state deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.

Section 2. Representatives shall be apportioned among the several states according to their respective numbers, counting the whole number of persons in each state...

1965: The Voting Rights Act of 1965, 42 USC §1973:

(a) No voting qualification or prerequisite to voting or standard, practice, or procedure shall be imposed or applied by any State or political subdivision in a manner which results in a denial or abridgement of the right of any citizen of the United States to vote on account of race or color,...

2008:

Why You're Reading This Online

Sometimes there's no substitute for being there.

This couuld be the introduction to a column about why technology, Web 2.0, and collaboration at a distance all add up to precisely zero threat to places like New York and London--making them, in fact, more important than ever--but I have a different road in mind. The road I want to go down today is about interpretation and nuance coming out of shared experiences, and how widely they may vary.

Our text for today is the National Law Journal's article "Survival Tips for Law Firms," covering a presentation on "The Law Firm of the Future -- Who Will Be the New Winners and Losers?" that I gave at DRI's annual convention in New Orleans last week. Here's the line from the article that got my attention (emphasis mine):

The law firms that survive during these trying economic times are the ones that are willing to discount rates, said panelists, which included Bruce MacEwen, a New York-based law firm consultant; Sheryl Willert of Williams Kastner in Seattle; Patricia Diaz Dennis, senior vice president and assistant general counsel of AT&T; and Raymond Williams of DLA Piper's Philadelphia office.

That's actually not what I said. But what do I know? I was only there.

With all deference and utmost respect to the reporter, understanding the demands of delivering from remote locations on deadline, the fascinating aspect of this story to me is how perceptions of the "same" event experienced by different people end up producing such different impressions.

So what did I talk about at the DRI annual meeting?

• The client/law firm disconnect
  • Two-thirds of law firms give themselves an A on client service, but fewer than 1 client in 5 does
  • 85% of clients rank us poorly based on our understanding of their needs
  • But 85% of them say they explain what they need very clearly
  • 60% of clients are unwilling to share investments in knowledge and training
  • But over 80% want to "share" cost over-runs
• The billable hour conundrum
  • Now that we can itemize to the dime what we did, by whom, when, and where, we think we're bulletproof on fees
  • But this is only an invitation to clients to micro-scrutinize what we actually did, and to tell us that we did it (a) unnecessarily; (b) with the wrong people; or (c) inefficiently
  • Wouldn't it be better, after all, if we could just get back to "For professional services rendered: $XX,000"?
  • As for "professsional services rendered," do you think it's a pipe dream? Go back 30 years (or less, where client trust prevailed) and it was commonplace. I'd like to think it would become commonplace again during the remainder of my career.
• The requirement to make your clients look good
  • Impeccable lawyering is, and has been for a long time, table stakes. Any serious AmLaw 100 or 200 firm can do your deal or defend your litigation with, in all likelihood, utter competence.
  • But true client service goes beyond that. An associate GC at Goldman Sachs calls legal advice "level 1" service, but you want to get to is "level 2." "Level 2" is "that you make me look good; you don't just return my emails, you figure out what I need to be totally prepared for this internal meeting I have coming up, and you advise me on that. Because that's where you distinguish yourself."

Back to the beginning: How could it be that it was reported that I recommended, in a soundbite, discounting rates--which I firmly disavow as a strategic model, and which I never have and never will advise--as opposed to all the thngs enumerated above that I actually thought I did say?

Actually, I can't answer that question. As I said, reporters in remote locations under deadline file stories. That's their job and I commend them for it. In my experience, they are almost without exception responsible, accessible, and committed to their craft.

My answer is on a slightly different level: They no longer have the last word. The famous "Mainstream Media" have lost their monopoly.

Look at the news that was reported in the space of a single week:

• The Christian Science Monitor will no longer publish in print, but only online.
• The Newark Star-Ledger, on track to lose $40-million this year, is laying off 40% of its newsroom staff.
• Time Inc. is laying off 600 people.
• The long decline in newspaper circulation appears to be accelerating, with drops occurring "nearly across the board."

Should we then be wringing our hands at the (inevitable, no matter how much they may protest) impairment of editorial coverage? I for one counsel optimism. How is that possible? Look around. There have never in history been more media outlets than there are now.

Other publications, including, I would fervently hope, "Adam Smith, Esq.," cover important issues with substance and depth in ways that conventional distribution models cannot always match. Imagine, if you will (yes, I've tried this thought experiment myself) bringing a business plan to a venture capitalist proposing, 5 years ago, to launch something resembling "Adam Smith, Esq.," but to do it as a monthly print publication. You would be escorted to the door before you could open your laptop. Why? Because it would be perfectly obvious that assembling a global audience of people interested in something as arcane (yes, I can say that) as "the economics of law firms" would be a fool's errand.

But, to launch the same publication online would be, and has been, entirely feasible:

• It permits you to "publish" multiple times per month, essentially at will, as topics develop;
• Everything is archived, and available through a click, in perpetuity;
• The combined power of word of mouth and my best friend, "Forward," will help grow circulation;
• The marginal cost of an additional copy is zero;
• It's available on demand across a variety of platforms from desktops to smart phones;
• And by now you get the idea: One would be a fool to launch any new publication other than online.

Don't for a moment think I'm Holier than Thou: Online publications can err as egregiously or more so than mainstream media--certainly if they're unreflective and sensational (I don't need to name names). But we have enough experience now with the media, onlne and off, to know who we believe and who we suspect of bias, who we know writes to unyielding daily deadlines and who publishes to the clock of a different drummer, who has column-inches to fill and who doesn't.

Herewith the first and last discussion you will ever read in these pages about the conventional publishing model.

Thank you for reading "Adam Smith, Esq."

E-Billing Survey: Reminder

Reminder:

If you haven't taken our quick (3-minute) survey on e-billing, please do so. You can sign up at the end to get a free copy of the complete, aggregated, anonymized results.

Take the survey!

Thanks.

Happy 4th of July

Watching Fireworks on the Fourth:
Coney Island, 1962
[Courtesy of Magnum]

Memorial Day

Arlington National Cemetery, Section 34 looking south

Legal Talk Network Show on the 2008 AmLaw 100

Yesterday Aric Press of The American Lawyer and I were interviewed on the "Legal Talk Network" for this week's half-hour installment of "Lawyer2Lawyer," on the topic of what the recently released 2008 AmLaw 100 figures reveal about the state of the profession these days.

Here's the link.

Enjoy.

"Adam Smith, Esq." In Strategic Alliance with Altman Weil and Jomati Consultants

With great pleasure, I can today announce that Adam Smith, Esq. has entered into a strategic alliance with Altman Weil, Inc., and with London-based Jomati Consultants LLP to consult with clients on matters related to law firm strategy and economics.

I have known Ward Bower of Altman Weil and Tony Williams of Jomati for some time and, while we have worked together informally in the past, the goal of this alliance is to improve what we can offer our clients in terms of depth and breadth at a time when the international legal marketplace is undergoing a period of major change. 

The resources and history of Altman Weil—going back to 1970—are well recognized and respected within our profession, and, together with my presence in New York and Tony's in London, I would like to believe we can provide our clients coverage from the two key capitals of the Anglo legal world.  

In announcing the alliance, Ward said:

"We are very pleased to be working with Bruce.  He is a true thought-leader on issues of strategic importance to the legal profession and increases the scope and depth of resources we can offer our major law firm clients."

And Tony added:

"I am delighted to be working with Bruce.  He is widely respected for his thought provoking views on law firm strategy and economics and he brings extra depth to our offering to major law firms."

Finally, on a personal note, I must tell you this is most exciting for me and a milestone in the development of "Adam Smith, Esq."

Update (19 March):  The Lawyer has published coverage, as has Legal Week.   

The Marketing Value of Publishing: 1440 to 2008

Over at "Drug and Device Law," they kicked up a little storm last Friday by asking why the marketing value of practicing lawyers' writing a blog seemed to be undervalued.  I first learned of it when my friend Mark Herrmann of Jones Day sent me a heads-up asking if I could respond.    Unfortunately, before I had a chance to do so, the WSJ Law Blog also picked up the story this afternoon. 

Here's the issue:  "Drug and Device Law" is apparently the most widely read site on drug and device product liability, with 25,000 page-views/month.  But the law firms the authors belong to (Jones Day, of course, for Mark, and Dechert, for his co-author James Beck) seem remarkably indifferent to and only passively supportive of the blog.  Why might that be?  Mark and Jim propose four theories (as aptly summarized by the WSJ Law Blog):

“Most widely read product liability blog” = “World’s tallest midget”: 25,000 pageviews is a drop in the bucket, and there’s essentially no institutional benefit to blogging. If the two of us — Beck and Herrmann, the blogging morons — want to waste our Saturday mornings feeding this beast, we should go ahead and entertain ourselves.

Power of blogosphere eludes firm management: Management is basically folks over 50 who start their days sipping a cup of coffee and reading the Journal. Only people under 40 start their days sipping a cup of coffee and checking [legal blogs].

Blogs attract the wrong eyeballs: The target market for big firms such as ours is the general counsel and C-level management of Fortune 500 companies. With all due respect to our visitors — and we love you guys; really! — you folks are younger and less important.

Where’s the money in this? It takes many hours of effort each week for the two of us to provide regular, fresh content to this site, and the amount of business generated doesn’t justify the effort. If the two of us get some personal satisfaction from blogging, no one will interfere, but firms do cost-benefit analyses of marketing initiatives, and this one flunks the test.

Both the original piece and the WSJ followup have received numerous comments, which while they have few common threads do coalesce around the proposition that most blogs are a waste of time or worse, and that sorting the gems from the rest is time-consuming.  Interestingly, almost everyone who advances this view also adds the caveat that finding the  good stuff is highly rewarding—and a robust counterpoint to the mainstream media.

So what do I think here at "Adam Smith, Esq.?"  Not being in a large firm any more, I fortunately don't have anyone whatsoever looking over my shoulder when I write and hit the "publish" button.  But I think each of Mark & Jim's hypotheses has some merit, most particularly #4, "show me the money." 

There seems to be less and less time for labors of love, for things we do not because they contribute to the bottom line but because they advance our learned profession, serve the cause of justice or the disenfranchised, or boost the flagging morale of a colleague.  And it's very hard to infer any 1:1 correspondence between what I write here on "Adam Smith, Esq.," and my speaking and consulting engagements with firms, just as it is—so I suspect—very hard for Mark and Jim to identify clients who have come to them through "D&D Law."

That's not why I created "Adam Smith, Esq.," and I suspect it's not why they created D&D Law.

I part company with them, however, on ##2 and 3, "management doesn't get it" and "the wrong eyeballs."  At least judging from my experience, some of the most loyal, dedicated, and enthusiastic readers of "Adam Smith, Esq.," are managing partners and firm chairs at BigLaw firms.  I also believe firmly that there's no such thing as "the wrong eyeballs."  In the famous six degrees of separation syndrome, some of the most rewarding encounters I've had in the real world with people new to me have come through a friend of a friend of a referral of a reader who pointed them to "Adam Smith, Esq."

Since time immemorial—or at least since Gutenberg (1440)—lawyers have indirectly promoted their visibility and enhanced (with luck!) their credibility by publishing on legal issues and gaining a reputation for being thoughtful observers. Now that we can do it in the online medium, nothing fundamentally has changed.  The basic equation remains the same:  "Assertion persuades not; but demonstration convinces." 

It does me no good to ask you to believe that I'm a thoughtful fellow who cares deeply about the management of law firms and I would not insult your intelligence or waste your time by saying that.   But it has apparently done no small bit of good to have founded and be publishing "Adam Smith, Esq."

So my words of advice to Mark & Jim?  Hey, just keep it up.  As long as it is its own reward.  Because your site, in and of itself, will never be more (and should never be less; if it becomes so, it's time to pull the virtual plug).

Or, as my wife has observed, be realistic about this salient fact:  "'Adam Smith, Esq.' is, itself, nonprofit."

A Q&A With LexBlog About "Adam Smith, Esq."

Kevin O'Keefe and Rob La Gatta of LexBlog posed a few questions to me a week or two ago, for their "LexBlog Q&A Series," and I thought you, Dear Reader, deserved to see my answers.

1.  When did you start Adam Smith, Esq? What was your purpose in doing so?

December 2003.

I had looked around the so-called legal "blawgosphere" pretty thoroughly—it was actually possible to know everyone then, there were only a few dozen of us—and I saw nothing about the economics of law firms.  Since I thought it was an exceptionally rich topic, with no apparent "incumbent," and since of course it's a topic I'm passionate about, I decided to launch "Adam Smith, Esq." as an experiment in online publishing.

I don't call it a "blog," by the way; I still think that has negative and pejorative connotations.  "Adam Smith, Esq." is a publication, albeit one which happens to be online.  As an aside, I can't imagine launching any publication today that would not be heavily or exclusively online.  And from an instrumental and practical perspective, the "Movable Type" publishing software that powers "Adam Smith, Esq." has a number of features and characteristics that you would surely want in any well-organized and architecturally sound publication:

• The default organizational scheme is reverse chronological.  This makes intuitive sense.  After all, which copy of The Wall Street Journal am I most likely to be interested in?  Right—today's!
• Each column, or piece, has its own unique identifying URL which will never change, called its "permalink."  This makes it exceptionally easy to refer friends and colleagues to pieces.
• Archives are spontaneously and automatically created both by month and by topic category.
• It has a nice built-in search feature (at the top left-hand column of "Adam Smith, Esq.").
• And it automatically generates an RSS feed.

All that said, when I launched "Adam Smith, Esq.," I did so in stealth mode, telling no one initially (besides my wife).  Why?  A number of reasons:

• I might find the time commitment too onerous.
• I might find others covering similar territory better, faster, or more articulately than I.
• I might have nothing to say.
• And, in any event, I didn't want to launch into the world with a bare naked site along the lines of, "Hello, world, this is my first piece."

Of course, after a couple of months it became clear to me that I should go public with what I was creating.

2.  You write fairly lengthy and detailed posts. How long does it take to do them? Do you have a particular setting in which you feel you do your best writing?

Actually composing my columns takes less time than you might think.  I'd like to believe I have a characteristic and identifiable writing style and tone of voice, and at this point I find that second-guessing myself too much on style harms rather than helps the columns. 

I strongly prefer—almost to the point of its being a hard and fast rule—writing at the beginning and the end of the day, say, before 9 am or after 8 pm, when there are no incoming distractions of phone or e-mail.

But the most time-consuming piece of any column is deciding which topics are worthy and then, worse, figuring out what I want to say.  That's the hard part.

3.  Walter Olson said you cover your niche better than the conventional legal press (not surprising, given the timeliness of blogs compared to print). Do you find that readers are coming to your site before they hit the traditional legal publications?

That's a good question.  My hunch—informed by precisely zero data— is that people come to "Adam Smith, Esq." for more considered background and reflection on issues.  I explicitly do not cover breaking news and when there is a big story (such as the associate salary spike last year), I often consciously wait a week or two before writing a piece, which then tries to explain the true salience of the event and what I think it really means.

I would still like to believe that people find content here that they do not find in the conventional legal press, and that we're complementary to each other. 

4.  When looking at your 2007 site traffic stats, you can see some fluctuation: it seemed to peak around June, then drop until October before rebounding again. Do you use site traffic as a way to gauge how you blog (ie how frequently to post, what to write on, etc)?

Much as I love data ( the economist in me can't help myself), this is something I stay a million miles away from.

For starters, when asked how frequently I think I should publish a new column, or how often I do in fact, the answer is I have absolutely no guidelines or goals in mind.  For me, it's all about quality, not quantity.  It might be germane to mention, in this connection, that the "acid test" in my mind of whether a piece is ready, before I hit the "publish" button, is this:   If a reader had never been to "Adam Smith, Esq." before and this was the first piece they were ever reading, would they want to come back?  If the piece passes that test, it goes live.  (If you're keeping numeric score, as Movable Type faithfully is under the hood, this is column #855 on "Adam Smith, Esq.," which, over its 4+ years of existence, works out to between 17 and 18 columns a month.) 

But second, I dare not, cannot, and do not, as publisher, live or die by site traffic.   Let me hasten to add that the very strong site traffic—about a third of a million page-views per month—is unspeakably gratifying.  But in terms of micro-analyzing it or trying to micro-manage it, I would prefer to keep a firm grip on my sanity.

Third and perhaps most important, I never have and never will conceive, target, or tilt pieces to what I might imagine would curry favor or interest among hypothetical readers.  The only enduring asset I have here at "Adam Smith, Esq." is editorial and intellectual integrity, and I guard it furiously, fully aware of the crown jewel that it is.

5.   What is the biggest challenge you've experienced with blogging, and how did you overcome it? What about the biggest reward?

I assume you meant to say the biggest challenge with "publishing" ;-). 

An utterly surprising one:  Before I started "Adam Smith, Esq.," I now realize that I was not as critical a thinker as I could be.  The discipline of reading widely for content for the site, and thinking deeply about what stories might mean, has honed that skill in a way nothing I've ever done before, professionally, ever has.

As I say, utterly surprising:  Had you asked me five years ago whether I thought I was a "critical thinker," I surely would have responded in the affirmative.  I've graduated from schools people have heard of, have spent my entire career in one of the most competitive and high-energy cities in the world, and essentially have pursued a profession where thinking is the coin of the realm.

But it was not until "Adam Smith, Esq." that I really began to read for unspoken assumptions, for "what-if's" and the implications of logical extrapolations of the author's argument, for internal inconsistencies, for logical leaps of faith, for gracious or compelling rhetoric standing in for analysis and careful discussion, and so forth.  It has been an intellectual journey of the first order.

Aaah, and the biggest reward?  Exceedingly simple:  Meeting people in the real world, everywhere from New York to California to Europe to China, that I would never in a million years have met without "Adam Smith, Esq."   Absolutely nothing beats making those real world connections, and forging them into personal and professional alliances.

Sometimes the Joke Is On You

Guilty as charged on all counts.

(With thanks to The New Yorker.)

In Palm Beach Next Week (Wed 16th Jan)

I'll be at Hildebrandt's Marketing Partner Forum 2008 held this year at The Breakers, Palm Beach, on January 16. If any of you will be attending, shoot me an email and maybe we can get together.

Report to Readers: 2007-2008

At the end of one year and the beginning of a new, it's fitting that I offer to you all a report on the state of "Adam Smith, Esq."

As Presidents intone at the start of their State of the Union address (I believe utterly without fail), I can report that the state of "Adam Smith, Esq." is very good.  The community of readers has become larger, the level of interest is clearly higher than ever, and the traffic level in unsolicited emails I receive from utter strangers and old friends alike is also at an all-time high. 

Lest you wonder, this is all profoundly gratifying, and I thank you—the reader community—for your implicit and sometimes quite explicit endorsement of what I'm trying to achieve here, which is, simply put, to provide the most intelligent, wide-ranging and yet focused online publication addressing the economics of large law firms.

On both a personal and intellectual/professional level, the most satisfying result of "Adam Smith, Esq." has been the opportunities I've had to meet many of you, in venues ranging from New York and San Francisco to London and Hong Kong, in the past year.   Lest you doubt it, you are a remarkably sharp, engaged, curious, reflective, and yes, humorous, assembly of crack professionals.  My personal New Year's resolution is that I get ever more chances to meet and work with more of you in 2008 and beyond, in the context of my consulting practice. 

Finally, a quick "advertisement for myself:"  Yes, I do have an active consulting practice, focusing on:

• strategy, be it at the firm-wide level, or the office or practice group level;
• financial issues, particularly compensation, since the economist in me is a firm believer in the long-run power of incentives; and
• M&A among firms—both "pre," evaluating potential acquisition candidates for economic and cultural fit, and "post," assessing integration, the progress (or lack thereof) towards the Platonic ideal of the "one-firm firm," and advising on tools and techniques to improve fit.

The energy I derive from and bring to consulting stems from being able to engage with genuinely thoughtful, and highly articulate, people about complex and even gnarly challenges central to their professional lives.  I can report that it's the most fun thing I've done in my life that simultaneously pays.

If you want to toss some ideas around, the doctor is in.   Shoot me an email and we can start a little conversation.  I would most sincerely look forward to it.   And separately, aside from consulting per se, I regularly speak at conferences,  partner or practice group retreats, and so forth, on topics ranging from the challenges of the 2008 landscape to integrating laterals to the impact of "Web 2.0" on law firms to the increasing segmentation of the AmLaw 200.  Let me know if there's something you'd like my thoughts on.

And now, as they say, "let's go to the videotape."  The information and statistics that follow are largely drawn from our third annual reader survey (thanks again to all who participated!—hundreds of you) and of course to the ubiquitous server logs.

Visitors to "Adam Smith, Esq."

I'm extremely gratified to report that traffic to the site remains strong, as evidenced by the totals of monthly page-views, which are now solidly north of 300,000.   ("Page views" is the statistic most favored by advertisers to measure site traffic, so I take their word  for it that it's intrinsically meaningful.  "Hits," which is a more technical term, is quite meaningless although if you're interested it's in the millions/month.)

In terms of who you all are, suffice to say you're an august and distinguished group!  In particular, the readership strongly skews ("overindexes" is the more technical term) towards relatively senior people in law firms.   For example, the proportion of readers who are partners vs. associates is much higher than the actual partner/associate ratio in the real world, and among  partners the proportion who are on the executive committee or even managing partner is likewise much higher than a straight cross-sectional measurement would produce.

Who You Are

Of interest—but not in the least surprising or disappointing to me—is how few inhouse lawyers follow "Adam Smith, Esq."  As you know, they are simply not my target audience.  When  a friend asked many months ago why not, I responded that "there's no 'P' in their P&L."

Similarly, you skew towards the larger firms:   Again, nothing surprising about that:

If you parse the numbers a bit, you can infer among those of you in US-based firms (and thus eligible for the AmLaw ranking), 62% of readers are from an AmLaw 200 firm.  I can also report from experience and analysis that readers in non-US firms skew heavily towards the Magic Circle, and the UK and Global 100.

Finally—on the quantitative part of the survey at least—for fun I asked what your practice specialties are.  Here are the results:

This probably, at least in a rough and ready fashion, reflects about the distribution of practice areas in the real world, although I suspect IP specialists are slightly more heavily represented than their actual numbers (based on nothing other than raw surmise, anecdote, and personal speculation).

This takes us to the qualitative part of the survey.

Here's where it gets really interesting.

More About You & What's On Your Minds

First, a few data points of interest about you all, selected somewhat randomly:

• nearly two-thirds of you have a home office;
• almost one-fifth have a second home;
• more than a quarter have a wine collection and nearly half regularly purchase "premium" liquor; and, lastly, my own personal favorite
• more than half of you (54%) have traveled internationally for leisure in the past 12 months.

For your non-work pursuits, you're a civic and culturally minded group. Your top five "off the clock" pursuits, in order:

• spending time with family and friends; and reading, in a virtual dead heat for first and second;
• coming in third, cultural activities (theater, dance, opera, museum-going, etc.),
• and in a near tie for fourth and fifth, showing perhaps that we enjoy eating but also want to stay fit: outdoor activities and sports, and cooking/wine/restaurants.

But now let's get serious. One of the questions I've asked in each of our three annual reader surveys is, "What is the most pressing strategic, business, or financial issue facing you or your firm?"

Here are some of your responses, which I find in almost all respects remarkably candid, insightful, heartfelt, and, as with many human assessments of their current situations, ranging from the confident to the poignant. Hence, in no particular order, and with anonymous thanks to all of you willing to share some of your thoughts (all comments verbatim except for my occasional notes in brackets):

• Profitability [that was the sum and substance of this particular answer--someone after my own heart, no doubt]
• Being squarely in the Hollow Middle
• "Mid Market Mush"
• Recruiting premium talent directly out of law school
• Mid-level associate retention--the pyramid scheme has become an hour-glass
• Associate retention
• Associate retention
• Associate retention
• Associate retention
• Associate retention
• Insane associate salaries
• Employee morale; eat what you kill model
• Low revenue per lawyer compared to those we consider to be our competitors
• Post-merger integration
• Fighting the natural inertia firms have to keep doing things the same way.
• Shifting the culture of a firm that has always been very successful, but risks a gradual (but very real) erosion of its market share/position. Our past success/prestige has bred a certain level of complacency, particularly among our more senior ranks. [This strikes me as a particularly astute analysis; there are perhaps a dozen or two firms in this position, and I hope to have more to say about it in general in 2008.]
• Lack of alignment between (perceived or wishful) strategic growth initiatives and cultural anchors of the firm. The gap produces lots of talk but little serious action because the strategic initiatives put forward are never filtered through the realities and constraints of the firm's culture and operating model. [Another especially trenchant observation, of far more widespread application than the observer's firm alone.]
• Ineffective management. Rainmakers are not always the best communicators or managers
• Balancing the desire to grow as a firm versus the desire not to change. Our firm is looking to grow, and most everyone supports the notion, so long as nothing changes for the individual.
• The competition between billable hours and doing the other things that are necessary to have thriving practices. If there is enough time to actually plan a strategy, following through is quite difficult due to time pressures. The bigger the practice, the more non-billable things to do. If you do them yourself, you get crushed for time; if you hire folks to do them, you add overhead. The billable hour is not working for me.

Quite a mouthful--and I picked only a small handful of responses, and condensed some of those.

If these concerns are any indication as to the levels of pain, uncertainty, and anxiety out there, then we shall have a very interesting year here on "Adam Smith, Esq." indeed.

I've said it before, but I can't say it too many times: This online publication owes its strength to you, the readers, and the quality of the discourse you inspire. Thanks.

In closing, a few comments in response to my final question: "Any other editorial comments/suggestions/criticism? Should I cover more of X and less of Y, for example? Candor, please." I'll keep the self-congratulatory observations to myself, but suffice to say they were many, and evidently heartfelt. A selection of some others:

• The things I find most interesting are all part of a common thread that I can't quite sum up succinctly. The items are: billable hours, billable rates, associate compensation/bonus, PPP, work/life, partnership prospects, partner retirement, and any miscellaneous generational conflict issues that run through most of these.
• The interviews are always interesting, even the ones where I care not a wit about the interviewee or the subject.
• More analysis of the fate of the great middle.
• You have not done much on the "image" issue. How do firms raise their profile in sectors. What is the role of the business press and how does one manage the media to generate the most "buzz" for your firm or practice area?
• You rock, thanks! [OK, couldn't resist inserting just one]
• Your interests seem about right for my taste. Of course, you could always add a little sex and murder to go along with the money.
• You do a great job. By way of suggestions, I'd be interested in more critical and comparative discussion of firms. How they differ in culture, strengths, strategies, and prospects for success. I know you do a considerable amount of this, but I'd like more. For example, I'd be interested in your capsule opinions on each of the AMLAW 50 or 100 firms. Also, please be candid and critical. You usually are, but, occasionally, I get the impression that sometimes you are trying to flatter the Chairperson of a particular firm. [Fair enough, indeed touche. I've consciously shied away from criticizing firms by name, although I would like to think that I do my fair share criticizing short-sighted, self-serving, and otherwise generally stupid managerial practices. But should I call firms on the carpet, as I see it? Your input would be most valuable.]
• What about the simple pleasures of practicing law? Is that an uneconomical consideration in this day and age?

I can imagine no finer note on which to end this Annual Report to my Readers than that last comment.

No, it is not only and always about the economics of law firms. It's about the romance (if I may say so, having been there myself), the challenges both in terms of IQ and "EQ," the intellectual commitment and discipline, of the practice, and of serving clients. May it always be thus.

Happy New Year

May all your resolutions become resoundingly true.

Merry Christmas to All

Rockefeller Center, New York, Christmas 2007

In Beijing & Hong Kong Next Week

I'll be in Beijing next week from Saturday 1st December through Wednesday 5th December, then in Hong Kong Wednesday 5th through Friday 7th (leaving early Saturday 8th).   This promises to be a jam-packed trip and my calendar is already quite full. 

Indeed, there may already be more people I want to see than there will be time, but for those of you, Dear Readers, who are in either of those cities and want to drop me a note, please do so.  It would be terrific if we could actually meet, however briefly.

Being Thankful

Happy Thanksgiving

I know that I, and I surely hope you, Dear Reader, have a multitude of blessings to give thanks for—without cavil or reservation.

Across The Pond

This coming week, 11th—16th November, I'll be in London on business.    I'll essentially be headquartered in the City, staying at the Hoxton Hotel. 

Allen & Overy has been generous enough to provide me with an office while I'm there, and I'm told the phone # is [011.44] (0) 20.3088.7155.  I will also be carrying my UK cellphone, which is [011.44](0)7912.009126.  And of course, I'll have access to email, albeit only from my laptop and not from a BlackBerry or smartphone.

Although my schedule is pretty full at the moment, I would be delighted to hear from any of you in London who might want to reach out and say hi.  With luck, we could arrange a drink or a cup of coffee.

I hope to be reporting back frequently here on "Adam Smith, Esq.," as a primary purpose of the trip is to assess the view of the global marketplace from the UK perspective.

Last Call: Final Week for the Annual "Adam Smith, Esq." Reader Survey

Final reminder: 

You have one last week to take the Annual "Adam Smith, Esq."Reader Survey

I promise that it takes no more than two to three minutes, and that's if you dawdle.

• One randomly-chosen respondent will win a $200 AMEX gift check. Don't miss your chance to, conceivably, win something for the first time.
• It's your opportunity to tell me how to make "Adam Smith, Esq." more focused on your issues and your needs for the coming year.  And
• You can also share with me (anonymously, of course) what you believe to be "the single most pressing strategic or financial issue facing you and/or your firm."

Believe me that I read every single response, several times, and refer back to it repeatedly during the course of the year.

Take the Survey!

Thanks.

A First for "Adam Smith, Esq."

Being quoted in both The New York Times ("When $1,000 an Hour Is Not Enough," by David Lat of Above The Law) and The Wall Street Journal (Peter Lattman at the Law Blog picking up the NYT story), in "Is The 'Premium Party' Over?"—on the same day.

Time is Running Out to Take the Annual "Adam Smith, Esq." Reader Survey

Quick reminder: 

You have barely one more week to take the Annual "Adam Smith, Esq."Reader Survey

Why would you want to do this?   Simple:

• One randomly-chosen respondent will win a $200 AMEX gift check.
• It's your opportunity to tell me how to make "Adam Smith, Esq." more focused on your issues and your needs for the coming year.  And
• You can also share with me (anonymously, of course) what you believe to be "the single most pressing strategic or financial issue facing you and/or your firm."

I read every single response very carefully, and then I read them all again, before I read them all again a few months later. 

Take the Survey!

Thanks.

The Annual "Adam Smith, Esq." Reader Survey--Your Chance to Win $200

For you faithful readers who've been with "Adam Smith, Esq." for at least a year, you will know that with the fall season comes the annual "Adam Smith, Esq." Reader Survey.  For those of you who've discovered "Adam Smith, Esq." in the past year, this is your chance!

The survey will be open for about a month (yes, I'll remind you again), and I sincerely urge all of you to take two to three minutes to fill it out.  Why?

• One lucky survey respondent will win a $200 Amex Gift Check (sign up at the completion of the survey).
• If you haven't already, you can subscribe to my monthly newsletter (again, at completion of the survey).  The newsletter:
  • is free
  • contains material you will not see on this site, and
  • I guarantee the confidentiality of your name and email address—I will not sell, rent, or share your information under any circumstances.
• As you know, "Adam Smith, Esq." is free, so I rely on the kindness of advertisers to help pay the way, and the Reader Survey helps me ensure that any sponsors I might entertain for the site are at least of potential interest to you.

So take a couple of minutes to do me this small favor. Again, all your information will be kept strictly confidential.

Thanks in advance.

Bruce

"BlawgWorld 07" Out Today

Today "BlawgWorld 07" is being released by the same crack team at TechnoLawyer that put together last year's (yes) "BlawgWorld 06."   Here's the link to the eBook (pdf format). 

They've done a nice job with making navigation easy, and I'm pleased to report that thanks to the wonders of alphabetical order, "Adam Smith, Esq." is one of the first entries listed.  Each of the 77 blawg's represented has an entry from last year.   The winning piece from "Adam Smith, Esq." is my April 2006 "Let's Assume Everyone Here's An Adult..." which, among other things, attempts to explain the remarkable durability of the deeply flawed billable hour with this observation:

"We all know the political folk wisdom that "you can't beat somebody with nobody," and I believe that pretty much all of the commonly proposed alternatives to the almighty billable hour amount to "nobody."

Take a look.  I think you'll be surprised (pleasantly or unpleasantly is for you to judge) by the reach, quality, and scope of the articles.

Happy Birthday, Adam Smith

Today is Adam Smith's Birthday: June 5, 1723. He would be 284 today.

He was born in Kirkcaldy, Scotland, about 12 miles north of Edinburgh across the Firth of Forth, and is buried just off the Royal Mile in Edinburgh itself. Although there is no memorial to Adam Smith in Edinburgh, aside from his gravestone, one has been proposed, which would look roughly like this:

My birthday was just two days—and a few centuries—later. I expect no monuments in Edinburgh.

Memorial Day

Report to My Readers

"Dear Reader:This letter continues a custom begun 30 years ago of reporting the progress of The Wall Street Journal to our readers. In the first issue of the Journal, ..."

So begins the January 2, 2007 annual report of the WSJ to its readers.

I intend to inaugurate nothing nearly so formal here on "Adam Smith, Esq.," but what this publication is all about is communicating with you, my dear readers, and so it seems only fitting that I periodically bring you up to date on how things are going from the perspective of your faithful publisher.

First, a few basic facts:

• I started "Adam Smith, Esq." at the end of 2003 and launched it publicly in February 2004.
  
• As of today, there are 752 individual entries, or articles, on the site. If you printed out "Adam Smith, Esq." in book format, it would come to about 1,500 pages.
  
• All of my archives are and will continue to be available so long as I'm in charge here.  Server space is cheap; readers' time is not.
  
• My policy on comments is simple:  I approve them verbatim or disapprove them in their entirety.  Although, come to think of it, I can't remember the last (or even the first) time I did the latter.  But I never have and never will "edit" comments.
  
• Speaking of comments, several of you have told me of difficulties in contributing comments. You are not wrong.  I'm somewhat dissatisfied with the technology underlying the configuration of my comments system, but I've been to the wall and back with tech support to no avail, and at some point I have more important things to run to ground.  For the nonce, I humbly apologize and recommend that if you have something you'd like to contribute to the conversation, email your thoughts to me directly and I'll see that they get posted. 
  
• On the other hand, a minor technical victory I implemented recently was to create a "printer-friendly" formatted version of each article, accessible through the cryptically named "Printer Friendly Version" link you'll now find at the foot of each piece.
  
• "Adam Smith, Esq." runs on the  Movable Type publishing platform, which is the most sophisticated online publishing system that mere mortals can afford, and which supports many "blogs."  Movable Type incorporates such indispensable functions in an online publication as:
  • Archives by Category (down a bit on the left column)
  • A built-in RSS feed (top-most left column)
  • A site-specific search function (top left column)
  • A so-called "permalink," or unique, unchanging hyperlink address to each and every article (at the bottom of each piece), and of course
  • The default chronological order ranking of items.
    
• That said, permit me as Founder and Publisher to urge you to think of "Adam Smith, Esq." not as a "blog," a word which to this day comes with unfortunate connotations,  and a word I have assiduously avoided for at least a couple of years.  It is, in conception and in fact, a "publication"—one which happens to be online.

But enough about facts and stats.

Here's the stuff that matters. "Adam Smith, Esq." exists and, as you'll see, thrives because:

• The subject—the economics, strategy, and leadership of sophisticated law firms at the start of the 21st Century—is intrinsically fascinating to me and, I gather, to many of you.
• I knew there had to be—and you have vindicated me in this conviction—a smart, informed, opinionated and inquisitive reader community that would appreciate and follow a site devoted to that topic.
• The challenges facing our firms have never been greater, as the pressures of globalization, consolidation, and the war for talent intensify in ways most of us could never have imagined when we began our careers. And
• I do my utmost to address these topics with the level of sophistication, rigor, and nuance that I believe you are entitled to.

As some of you know, "Adam Smith, Esq." has expanded into the offline world as well.  Most of you probably know about my "Law Firm Finances 101" offering, which has been quite well received.

I'm gratified to report that last month the Dean of Career Services at Harvard Law School approached me about offering it to their second and third-year students—and now to their faculty as well—and I'll be presenting it in Cambridge next September.  Although I'm a Stanford Law grad, I'll take Harvard as my first law school client any day of the week.

Also, I'm being invited to speak at an increasing number of domestic and international conferences, and law firm partners' retreats and other offsite events, which I find one of the most challenging things I can possibly do.   Some of these have preceded, and some have followed, my being engaged by the firm to talk through strategic and financial challenges they're facing.

Most of you are aware of my free monthly e-newsletter, which features at least one piece of content not available on the site (subscribe here), and I'm pleased to report that less than one year after launching it we have as of today 1,875 subscribers, from around the English-speaking world.

Finally, a report on visitors to "Adam Smith, Esq."

Suffice to say readership has been constantly growing:  Which the economist in me takes as the ultimate sign of marketplace validation.  Here are the numbers. 

Last month, April 2007, was an all-time high in terms of number of visitors.  (The metric I favor is "page views," which means one person looking at one page.)  Here's the pertinent graph, going back to September 2006, of page views per month:

This shows nearly 300,000 page-views on the site last month.

But wait, there's more:   Based on reader surveys, about one-third of you subscribe to "Adam Smith, Esq.," by RSS feed. Your subscriptions are not reflected in these statistics since, technically, you are not "viewing pages" on the site.  So if we add back in another, say, 30% on top of those numbers, it means nearly 400,000 page views last month.

This is a deeply gratifying number—and one which is both humbling and slightly shocking.

It does, however, speak to the power and the loyalty of you, dear reader.  As I say to anyone who tells me they enjoy "Adam Smith, Esq.:"  "Tell your friends!"

Evidently you've been doing just that.  Keep it up, and remember that the publisher is always in.

Would Adam Smith (1776) Publish Online?

At the intersection of the original Adam Smith and the 'net is, well, irresistible territory.  And now we have it in the current Forbes, courtesy of P.J. O'Rourke's "Adam Smith:  Web Junkie."

Here's the thesis, which is indisputably correct:

"I wonder if the know-it-alls at Wikipedia realize that the Internet was fully described and completely understood more than 200 years ago by Adam Smith, founder of free market economics. [...]

"In The Wealth of Nations , published in 1776, Adam Smith explained the three factors that constitute the free market: pursuit of self-interest, division of labor and freedom of trade. There you have the Internet without so much as a mouse click. [...]

"The Internet is not a wonderful new world. The Internet just is a natural extension of the free market."

But it's deeper than that, at least to my way of thinking.

Every time I see or read another hyper-ventilating media expose of that old devil the Internet, with its fraud, its cons, its porn, its deviants, and its identity thieves, I can't help but think of the marvelous, uplifting, inspirational, fascinating, and deeply challenging experiences that constitute my own personal history of exposure to the 'net.

And in trying to reconcile these views, the answer is really staring us in the face: Humans created the 'net, and the 'net reflects us.  So lots of traffic (read: attention) goes to news, sports, money, food, family, travel, sex (of course), health, shopping, commerce—you get the idea.  I'd wager that the proportion of off-line, "real world" assets and dollars devoted to each of those categories is almost precisely mirrored online.

But back to Adam Smith.

"In The Wealth of Nations Adam Smith said that an individual "stands at all times in need of the co-operation and assistance of great multitudes, while his whole life is scarce sufficient to gain the friendship of a few persons."

"Smith saw that the free market answered liberty's need for a larger network of voluntary association. The pursuit of self-interest means that the free market has built-in incentives for network maintenance and expansion."

"Since networks are self-organizing they are, like all do-it-yourself projects, a mess. This makes networks too hard for any one person to understand, let alone dominate.

" Most of our lives are spent in channels or chains of command or circuits.  Networks release us from this. We are presented with numerous alternative connections. On the Internet these connections are, without intending a pun, virtually unlimited. We can take our business elsewhere or be that elsewhere by starting a business of our own.

"Networks aren't egalitarian. Michael Dell always will be a bigger node than we are. But networks aren't hierarchal, either. There's no top and bottom to them, no magnetic north of authority. It's all side-to-side and back and forth. Detours, shortcuts and work-around's make a network."

In other words, the 'net permits us to create new connections, to launch new conversations, and to form new micro-communities neither foreseen nor exhorted by any person or group directing our actions or our attention. Sounds like a free market to me. If, as O'Rourke says, "the Internet is an advance for voluntary association," then Adam Smith would surely approve.

And of course he'd be publishing working drafts of Wealth of Nations online for critical commentary as they were done.

Quoted in The Wall Street Journal

When both I and my friend Larry Ribstein are quoted in the same Wall Street Journal article, it's too rich to resist. So, hoping this constitutes "fair use," herewith the piece from today's paper, pg. B2:

Losing the 'LLP'?

With the trends of law-firm consolidation and globalization, and at a time when the private-equity partnership Blackstone Group has made headlines with its IPO filing, some in the legal industry are wondering if and when we'll see the first publicly traded law firm.

"I would be surprised if in my lifetime we didn't see a law firm go public," says Leslie Corwin of Greenberg Traurig LLP, who advises law firms on business issues. "And I hope I'm around to do the deal."

Why hasn't it already happened? Ethics rules prohibit firms from selling equity shares in law firms to nonlawyers. Theoretically, say legal-ethics types, a law firm could have a potential conflict between its duty of loyalty to its clients and its duty of loyalty to its shareholders. Another ethical conundrum: Lawyers vigilantly protect the attorney-client privilege, and some fear that as a public company, a law firm could risk divulging client confidences.

Still, Goldman Sachs Group Inc. is a partnership-turned-public-company that is very much in the business of servicing clients and protecting their confidences, and has managed the move well. Larry Ribstein, a professor at the University of Illinois College of Law, says a publicly traded law firm could be set up so that the lawyer-owners control the firm and the public shareholders have little or no control.

Adds Bruce MacEwen, a law-firm consultant and blogger, "The restriction against law firms going public reflects a medieval-guild mentality." He adds, "Today's law firms, which are sizable businesses by any standard, deserve access to the capital markets."

Lessons in Flexibility

That didn't last long.

Barely 24 hours ago we went live with the "Swapped Column" format change for "Adam Smith, Esq.," switching the wide/right column for the narrow/left column. (As previously reported, the middle/content column was untouched.) Although we did it for a reason—trust me, one of my standing resolutionns in life in general is that I always try to do things for a reason—I didn't like it and some readers were gracious enough to write and mention that they didn't like it either.

The problem as I diagnosed it was that having the wide column on the left, before one's eye came to the content column, was far more distracting than having it on the right (since we read English left to right).

I also took a quick sanity-check tour of the Web and confirmed that such professionally-done sites as The New York Times, The Wall Street Journal, The Financial Times, The Economist, et al., follow what seems to be an emerging or emerged Web convention of "wide-right."

So there you have it.

But another one of my standing resolutions in life is that you'll never know unless you try it, and that what you learn from a "failed" experiment can be at least as valuable as what you learn from successes. After all, without failed experiments we never would have had penicillin or Lucite, and we'd still be relying on the "ether" as the universal medium that transmits light.

Do Not Adjust Your Television

Over the weekend we took "Adam Smith, Esq." into the Dreamweaver workshop for a little outpatient surgery delving deep into the bowels of HTML and CSS (don't ask).

The procedure was designed to swap the right and the left-hand columns, while leaving the middle column (where the good stuff is) absolutely unchanged and intact. I hope the procedure has been a success, as we were assisted by our usual crack team, but I haven't been able to test the revised design's performance across all platforms and all browsers.

So: Merciful readers, if the look of "Adam Smith, Esq." is suddenly illegible or nonsensical to you, please let me know at once and we'll re-admit the patient for a follow-up elective procedure.

Meanwhile, our fingers are crossed and our coders are standing by.

2007

To All Our Valued Readers:
Sincere best wishes for a splendid, invigorating, prosperous 2007

"Lawyers Appreciate..." Meme

Having been tagged separately and independently by J. Craig Williams and by Gerry Riskin to contribute to the meme launched by Stephanie West Allen and Julie Fleming Brown to participate in the "Lawyers Appreciate..." round-robin, I feel it incumbent upon myself to respond before the midnight Dec. 31st deadline, so without further ado:

Lawyers appreciate professional management at senior executive levels of their firms.  Lawyers are not taught, and by and large don't care to learn about:

• competitive strategy
• management 101
• finance
• marketing
• IT, or
• human resources.

Erego those functions should be left strictly under adult supervision.  Hire worldly-wise and savvy strategic advisers, Chief Operating Officers, Chief Financial Officers, Chief Marketing Officers, CIO's, and heads of HR, and get the lawyers out of their way.

What lawyers do care about is professional excellence, a collegial and fulfilling atmosphere, and above all else the ability to serve appreciative clients with impeccable legal counsel.   Lawyers appreciate being able to focus on that to the exclusion of all else.  Let them.

"Wealth" and "Conscience"

At "Adam Smith, Esq.," we don't talk about Adam Smith himself very much, but at year-end it seems appropriate to pay a moment's homage to this site's intellectual godfather and, I hope, provide those of you who may not have studied him closely a slightly more nuanced perspective of his views.

To start, there could be no better introduction than this discussion of the interplay between his most famous work, obviously, The Wealth of Nations, and its predecessor by 17 years, the relatively unsung Theory of Moral Sentiments.   The piece takes off from Adam's Fallacy: A Guide to Economic Theology, written by Duncan Foley of New School University in New York, which is described as "a beautiful little book. It contains some of the most lucid exposition of the core ideas of economics that I have ever read."  (The reviewer is David Warsh, author of Knowledge and the Wealth of Nations, which I will soon be reviewing here; Warsh is a former Boston Globe columnist.)

The "fallacy" of "Adam [Smith]" is this:

"So what exactly is Adam's fallacy? According to Foley, it's "the idea that it is possible to separate an economic sphere of life, in which the pursuit of self-interest is guided by objective laws to a socially beneficent outcome, from the rest of social life, in which the pursuit of self interest is morally problematic and has to be weighed against other ends." This abstraction of an economic sphere from the messy complexity of real life is indeed the kernel of present-day economics.

But this entirely overlooks Moral Sentiments (for the 18th-Century phrase "moral sentiments," substitute today's more apt "conscience," and your understanding will increase), which opens thus:

"How selfish soever man may be supposed, there are evidently some principles in his nature, which interest him in the fortune of others, and render their happiness necessary to him, though he derives nothing from it except the pleasure of seeing it.... The greatest ruffian, the most hardened violator of the laws of society, is not altogether without it."

And here he describes "the man of system," who "seems to imagine that he can arrange the different members of a great society with as much ease as the hand arranges the different pieces on a chess-board; he does not consider that the pieces on a chess-board have no principle of motion besides that which the hand impresses on them; but that, in the great chess-board of human society, every single piece has a principle of motion of its own altogether different from that which the legislature might choose to impress upon it."

Indeed, these extra-homo economicus considerations are not just competitive with rational, gimlet-eyed, calculating analytics, at times they overwhelm "reason" altogether:

"What is it that prompts the generous, on all occasions, and the mean, upon many, to sacrifice their own interests to the greater interests of others? Is it not the soft power of humanity, is it not that feeble spark of benevolence which Nature has lighted up in the human heart, that is capable of counteracting the strongest impulses of self-love?"

Now, for some reason, the received wisdom handed down over 200 years later about Adam Smith is that he abandoned these views with publication of The Wealth of Nations.  Well, I'll spare you the academic arguments, but suffice to say there's not a scintilla of evidence that was the case.  Indeed, the better reasoned side of the debate, able to marshal far more evidence in support of its view, is that Smith intended a third and possibly even a fourth volume (cut short by his death, and his mandated destruction of all his unpublished manuscripts) reconciling and extending Moral Sentiments and Wealth of Nations by adding to the mix a treatise on the theory and impact of law and another on science and the arts.

So where are we left here in the 21st Century? 

Economics, a somewhat feckless discipline for the last few decades (there you have, in a nutshell, why I never entertained the notion of pursuing a Ph.D. in economics), has opted to "model what it can at the expense of ignoring what it cannot," and "moral sentiments" are famously unsusceptible to modeling.

One of my fonder, if milder, hopes is that my beloved discipline of economics will come to grasp more strongly the world as it really is with all its human complexity and contradiction, and return from its exile in the arid, mathematically intricate "blackboard economics" domain of homo rationalis economicus.

Happy New Year.

Web 2.0 in the Legal Blogosphere

As the legal blogosphere goes from childhood to adolescence to (eventually) full-throated adulthood, I've enjoyed not just contributing my own small efforts to that process, but also being able to be an armchair observer of other developments having nothing whatsoever to do with me. 

Partly this stems from my endless fascination with the proliferation of business models the online world has spawned, and with luck will continue to spawn.   Partly it stems from my wanting to vindicate—or invalidate—a theory of mine to the effect that any new media channel begins life by imitating the closest analogous old-media channel, and that it takes an explosion of experimentation before the new media understands "what it wants to be when it grows up."  Thus radio began by staging plays and running vaudeville acts years before discovering its real home in news, talk, and music.  Likewise, TV began by imitating radio before it found its strength in late-breaking news, sports, and series. 

And yes, thus the web began imitating print and has evolved roughly as follows:

• Web 1.0
  • revolution = hyperlinks
  • static content ("brochure-ware")
  • activity = surfing
• Web 1.5
  • revolution = self-contained portals
  • dynamic content (Salon, Nerve, Slashdot)
  • activity = search
• Web 2.0
  • revolution = collaboration
  • user-generated content
  • activity = share

Today I'm here to report on an emerging category of legal sites targeting micro-communities with micro-focused content. 

The best example I've seen, which I just learned of this week, is Drug and Device Law, which is—yep!—about pharmaceutical and medical device product liability.  Its founders and co-hosts are Jim Beck, with Dechert in Philadelphia, and Mark Herrmann, with Jones Day in Cleveland.  (Careful readers will recognize mark as the author of The Curmudgeon's Guide to Practicing Law.)  Their goal for the site?  As Mark put it to me, "Jim and I would be quite happy with a "fit audience, though few": inside counsel at drug and device companies and sophisticated lawyers who act as outside counsel for those companies."

Why is this different than, say, a three-ring binder treatise on the same subject?

Look back up at my bullets under "Web 2.0:"  The potential is for "Drug and Device Law" to become essentially home-base for a community of practice, exchanging ideas, analyses, and even briefs (well, OK, we could start with string cites).  Now imagine trying to replicate the robust functionality of that same potential community in the off-line world.

I rest my case. 

So Happy Zero Birthday to Drug and Device Law.

The 18th Century Is Alive & Well in New York

A few months ago an online flurry of commentary erupted over proposed amendments to the rules that govern lawyer advertising in New York.   Among other things, the proposals would define the term "advertisement" extremely broadly as any public communication made "by . . . a lawyer . . . about a lawyer."    Interestingly, it explicitly includes all online communications, including websites, emails, and instant messaging.  There is no requirement that the speech be commercial or related to the lawyer's practice.

The rules also require that every time a site (such as "Adam Smith, Esq.") is modified—every time I publish a new piece, presumably—it must be printed out in hard copy, stored for one year, and an additional copy mailed to the New York attorney disciplinary committee for its records.  As if this weren't antedeluvian enough, the site would have to be branded with the words "Attorney Advertising" in a font at least as large as the largest font on the page (so, about 60 points to match the banner title).

There are also draconian restrictions on TV and print advertisements, which fortunately don't concern me, but which would be laughable if they weren't so bizarre:  No client testimonials; no images of judges, courtrooms, or courthouses; no use of "nicknames, moniker, motto, or trade name[s]"; and God forbid nothing "about results the lawyer can achieve [or] statements describing or characterizing the quality of the lawyer's or law firm's services."

After you've picked yourself up off the floor at the news that 18th-Century thinking is alive and well (and pre-Bill of Rights 18th-Century thinking, at that), you might take a look at my letter offering comments on the proposal.  Comments close November 15, and should be addressed to:

Michael Colodner, Esq.
Counsel
Office of Court Administration
25 Beaver Street
New York, New York 10004

We shall see whether sanity, or medievalism, triumphs in New York.

Update:  Thursday November 9, 9:10 am

Charlie Green, co-author with David Maister of "The Trusted Advisor", is, I'm pleased to report, a regular reader of "Adam Smith, Esq.," and he wrote concerning this piece as follows:

Wow.

(And here I thought the 18th Century was the age of enlightenment, ha ha).

Your comments are well-taken (and well-written). But what I find even more interesting are the implicit assumptions I read into the proposal. In particular, it seems to me the legal profession has a profoundly arrogant view of its clients.

What I see as implicit in advocating such wide-reaching proposals are the ideas that
a. people are incapable of judging legal performance,
b. lawyers are inherently out for no good unless they are restrained,
c. "selling" is a dark art that is inherently manipulative, and
d. when said dark art is in the hands of said evil lawyers, clients are at huge risk.

Leaving aside the temptation to make jokes based on point b., all of them reflect a view that lawyers have huge influence and clients must be protected from information about them--for their own good, I'm sure.

What little faith in the market for services! Somehow people navigate the waters of auto and life insurance; figure out how to express preferences for physicians; manage to hire accountants, and choose spiritual advisors. But an MD is not considered a requirement to select a doctor; lack of a CPA doesn't keep us from making intelligent assumptions about accountants. In fact, it is precisely our content ignorance as clients which makes us want to hire an expert; if we knew enough to technically evaluate them, we wouldn't need them in the first place.

This is why a market in free speech, aka sales, is so helpful in selecting professionals. What makes lawyers think that open dialogue, the presentation of the equivalent of "bedside manner," or the opportunity to see and experience a lawyer as a working human being is somehow a negative? It is, to the contrary, precisely how most of us would prefer to choose a lawyer.

Good practitioners these days are a million miles away from the hustler peddler cartoonish caricatures of old. Clients are perfectly capable of making intelligent, nuanced decisions based on complex assessments of trust, the lawyer’s ability to comprehend the clients' problems, and ability to manage client expectations while navigating the legal world.

Why deny clients the ability to make up their own mind? Arrogance, no matter what the dressed-up, snooty motives of "it's for their own good," is arrogance nonetheless.

Clients just want to be free to choose.

First of all, Charlie:  Thanks for your insights.

And I emphatically chime in:  The fundamental philosophical fault with the Neanderthal attitudes so conspicuously on display at the New York State lawyer disciplinary authority is profound distrust of both lawyers and clients, and a lowest-common-denominator assumption that, left to their own devices, these p eople will do self-destructive things. If that's  your approach—what I like to call, "managing for failure"—then disarming everyone in the room is indeed logical.

"Clients just want to be free to choose," indeed.  Informed, knowledgeable, rational choice.  Can't we all just be adults here?

1.2 Billion Copies of Adam Smith To Be In Circulation Next Year

Courtesy of a UK reader comes word that Adam Smith will adorn the new £20 banknote to be issued by the Bank of England next spring.  In The Guardian's coverage, the headline is "Adam Smith becomes first Scot to adorn an English banknote."

The £20 note is the most widely circulated of all denominations, with approximately 1.2-billion copies issued.   Aside from the portrait of Adam Smith there will appear "an engraving showing the division of labour in pin manufacturing with the words "and the great increase in the quantity of work that results"."

Perhaps predictably, there has been some genial sparring between left and right over who has the better claim to his legacy:  The left pointing largely to The Theory of  Moral Sentiments and its theme of the universality of human sympathy for others, while the right points to the "invisible hand" guided by the self-interest of each, with a minimum of governmental or societal interference, to produce the economically optimal results.  Mervyn King, governor of the Bank of England, offered a nicely inclusive statement: 

"Social institutions and market economies go hand-in-hand," said Mr King. "Second, people who, for the most part, pursue their own self-interest, are also prepared to stand back and ask how their actions should be constrained by social institutions. Such institutions arise because we build them."

I see a trip to the UK in my future to procure one of these, suitable for framing.

You Never Talk About In-House Departments' Issues

If you ever wondered why "Adam Smith, Esq." concentrates on law firms to the essential exclusion of inhouse legal departments—and if you happened to know that I spent nearly 10 years inhouse at Morgan Stanley/Dean Witter as a securities lawyer, slightly longer than I practiced in firms—I have the answer for you.

Actually, my answer is quite straightforward:  When you set out to address "the economics of law firms," it's because you're fascinated by all aspects of their quest to "succeed," in the many dimensions in which success can be defined.   A key dimension is that of the P&L, and simply put there's no "P" in the inhouse department's P&L.

But the second reason is well expressed in today's WSJ article, "Silicon Valley's Outsiders:  In-House Lawyers?," which posits that in-house lawyers are still seen "as a block to the execution" of companies' plans, that they have "one hand tied behind [their] backs," (this from Mark Michael, the GC of 3Com from 1986 to 2003), and that "you're just not empowered or funded."

Too well do I know this tale.   Year after year after year at budget time I have seen law departments plead, beg, and otherwise prostrate themselves before the "real" businesspeople.  You can imagine this would become tiresome.

Covering it would also make for a rather boring publication:  So that, in a nutshell, is why "Adam Smith, Esq." essentially never has, and dollars to doughnuts never will, address in-house departments.

Sailor or Mountaineer?

In a first, the legendary David Maister hosts this week's BlawgReview, which I bring to your attention for the eclecticism of David's selections.

He does mention an "Adam Smith, Esq." piece reviewing "A Curmudgeon's Guide to the Practice of Law," and endorses my recommendation that Managing Partners should make their firms buy copies for all junior associates (and maybe just plain all lawyers, period).

David also turns up a piece I'd missed, countering the work-life balance lobby, which celebrates lawyers who thrive under pressure that would be "injurious or even fatal" to others.

Finally, he cites as "post of the week" a piece taking off from this Financial Times story mulling over the baffling contradiction between how sailors at sea behave when they learn of another ship or colleague in distress—namely, drop everything, including forfeiting races mid-course, to go to their aid—vs. how mountaineers behave when they see a fellow climber struggling (ignore them utterly, to the extreme of leaving them to die when trivial exertion could have saved them). 

Richard Branson is a sailor, Donald Trump a mountaineer.  Which are you?

Who Are You?: Results of the Reader Survey

As I reported a couple of days ago, the results of the Reader Survey are in, and I want to share with you some of the highlights. 

First of all, I'm deeply gratified by the many of you who took the time to fill out the su rvey:  Fully 260 of you responded, a very robust number.  I'm also pleased to report that the survey achieved its primary goal, yielding a tremendous amount of insight into:

• who you are;
• what you're interested in getting from "Adam Smith, Esq.;" and
• what concerns are at the forefront for you and/or your firms.

I hope to be able to capitalize on your comments and observations to make "Adam Smith, Esq." even more valuable, pertinent, and thought-provoking.  (As you see, I've already acted on the observation some offered that the previous design of the site could be difficult to read to some eyes.  If any of you have other specific suggestions about the "look and feel," please let me know.)

But to the survey:  Let's start with who you are.

• Not surprisingly, 72% of readers work in law firms.
• 21% of readers are partners, and of these:
  • 5% are Managing Partners or Chairs of their firm;
  • 4% are on their firm's Executive Committee; and
  • the remaining 12% are "rank and file" partners.
• More than 60% of you work in AmLaw 200 firms, and 32% of you in AmLaw 50 firms.
• It looks as though many of you "have a life"—over 60% of you report traveling internationally for leisure in the past year.
• And you're a tech-savvy crowd:  Over one-third of you read "Adam Smith, Esq." by RSS feed.  I'm happy to report that, counting this group (who technically do not "visit" the site), the average monthly page views of "Adam Smith, Esq." are now just north of 250,000.

Many of you also took the time to provide thoughtful, truly useful comments and observations about the site.  (My crack Marketing Director, who has seen her share of surveys over the past 25 years, tells me that the extent and depth of response was most unusual—you all are a "hot bench.")  Of course, I'm delighted and gratified by the many compliments ("unique," "thoughtful and erudite," "spot on," "very out of the box,") etc., but of even more value to me—and hopefully to you, going forward—were suggestions for slightly different emphases or approaches to my subject matter. 

(Digression that's not really a digression:  I've served over ten years as President of our Upper West Side co-op [86 apartments, a 1903 building, 7 full-time staff] and often in my role as leader of the co-op I find myself impelled to remind people that while good news is all fine and dandy, it will take care of itself:  What I really need to hear, ASAP, is the raw and unfiltered bad news—then at least I have a fighting chance of doing something about it.  I've often thought too many managers get into trouble by ignoring this principle.)

That said, many of your suggestions have given me much to chew on.  For example:

• "I wish you had more stuff.  I'm a bit disappointed when I come by and nothing new has been added. [...]  Maybe once a week you could provide links to articles you're reading, without commentary:  A 'what I'm reading' post would be nice."
• "This is not a criticism.  Your work seems to focus on the largest, elite, law firms.  There are a huge number of boutiques or specialty firms that practice at a very high level and are very profitable.  I think they often have interesting lessons about focused strategies and different problems; perhaps more occasional coverage of these types of firms would be of interest to your readers."
• "More empirics."
• "Great job overall.  Please cover a single issue in depth periodically, e.g., revenue growth...."
• "I would like to hear your views on legal consultants and how they have shaped the market."

Again, thanks to one and all for participating!  I learned a great deal, and the strong response was very gratifying.

The last word comes from my stalwart Marketing Director, who insists (and I dare not cross her) that I mention in closing that the "Adam Smith, Esq." audience, i.e., you, is very attractive to marketers seeking to reach the cream of the AmLaw 200 (not to mention that you're an affluent crowd).  If you have any suggestions for her, please drop her an email.  Advertising is one obvious way that I can defray the costs of "Adam Smith, Esq." and help ensure the continued viability of the site.

Design Matters

Your eyes do not deceive you; we're experimenting with a slightly more evolved look for "Adam Smith, Esq."  While the banner/logo is sacrosanct (indeed, it's pending registration as a federal trademark), one of the comments that came through from more than one of you in the "Reader Survey" was that to some eyes and on some monitors the site was difficult to read.

Since just about the farthest thing from my mind is putting anyone off when it comes to "Adam Smith, Esq.," some tweaking seemed in order.  And I reserve the right to tweak some more; the banner, however, is safe and sound.

9.11.06

Around the corner and two blocks up, in Riverside Park, is New York City's Firemen's Memorial, dedicated in 1913 and, according to the Parks Department's site, "one of the most impressive monuments in New York City."

For those of you who may not be quite as familiar with New York, this provides the context:

"Riverside Drive stretches along Riverside Park and the Hudson River from West 72nd Street to Dyckman Street. When New York started expanding northward, the City acquired land, in 1866-67, for a park and scenic drive between the Hudson River Railroad and the rocky bluffs along the river. The original 1875 plan, by Frederick Law Olmsted, the co-designer of Central Park, called for a park with a picturesque drive winding along the natural contours of the land. Twenty-five years later, the result was an English-style rustic park and a formal tree-lined boulevard.

"A fashionable address at the turn of the 20th century, Riverside Drive attracted a collection of substantial neoclassical apartment houses and mansions along its eastern side. The Drive’s majestic elevation also made it an impressive location for colossal monuments and institutions, including Grant’s Tomb (1897) and Riverside Church (1930). The Firemen’s Memorial is one of more than a dozen monuments along Riverside Drive, including sculptures of Franz Sigel (1907), Joan of Arc (1915), Samuel Tilden (1926), Lajos Kossuth (1930), and Eleanor Roosevelt (1996)."

As for the monument itself, it's a grand, imposing, and complex assemblage.  Note the reference to horse-drawn fire wagons:

"Though originally intended for the north end of Union Square, the monument was ultimately built on the hillside facing the Hudson River at 100th Street. The memorial comprises a grand staircase (once flanked by ornamental luminaires), a balustraded plaza, a fountain basin, and the central monument. Made of Knoxville marble, the monument is a sarcophagus-like structure with a massive bas-relief of horses drawing an engine to a fire (the original was replaced by a bronze replica in the 1950s); to the south and north are allegorical sculpture groups representing “Duty” and “Sacrifice,” for which the celebrated model Audrey Munson (1891-1996) is said to have posed.

"The memorial exemplifies a classical grandeur that characterized several civic monuments built in New York City from the 1890s to World War I, as part of an effort dubbed the City Beautiful Movement, which was meant to improve the standard of urban public design and achieve an uplifting union of art and architecture. This monument has twice undergone extensive restoration, once in the late 1930s, through a W.P.A.-sponsored conservation program, and more recently through a $2 million city-funded capital project completed in 1992."

Since September 11, 2001, the Fire Department has held annual memorial services there on the anniversary of the event, when its lost 343 firefighters, its worst loss by far on a single day.

The "Adam Smith, Esq." Reader Survey: We Have a $200 Winner

From the "Adam Smith, Esq." Readers' Survey—and its $200 AMEX gift check, promised to one lucky winner—we now have news:  We have a winner!

But first, to all readers who took the survey:  Many thanks!  I truly appreciate your taking the time to participate, and, as I said, the first and foremost goal of the survey is to improve "Adam Smith, Esq." based on your feedback, and to make it more trenchant, useful, focused, and helpful.  Again, thanks.

Before identifying our winner, a comment on methodology.  About half of you who took the survey enrolled in the random drawing for the gift check.   To select the winner, I totaled up the number of enrollees and multiplied that by the random number generator (a function in MS Excel, which returns a random number between 0 and 1, to a large number of decimal places), which gave me the winner's rank in the list of enrollees.

And he is:

David Thomas, a senior associate in Wilson-Sonsini's tax practice (specifically, employee benefits and compensation), based in Palo Alto. 

I phoned Dave to let him know the good news, and he reciprocated by sharing with me, and now with you, his thoughts on winning:

"Bruce,

"Although I was happy to fill out your survey simply in appreciation for all of the useful information that I receive from Adam Smith, Esq., I am not about to turn down a prize. I just bought a new house and I am very likely going to use the gift to purchase 1) a garden fountain for my wife, and 2) a Sirius satellite radio for my car and office. On the other hand, the house I just bought was in Palo Alto, CA, so I might just use the gift check to buy groceries.

"Dave Thomas"

Don't Forget to Take the Reader Survey ($200 Could Be Yours)

You've got one week left!  Don't forget to take the "Adam Smith, Esq." Reader Survey, and enter your name in a random drawing for a $200 AMEX gift check.  (Why?  Because I want you to participate, is why.)

It takes 3—5 minutes, even if you dawdle.

A Lesson About Disappointing Clients (It Happens)

My apologies!

For the past 18 hours, "Adam Smith, Esq." has been offline due to a server failure at my hosting provider.   I have had several email and one phone conversation with them and they understand that, while I've been very pleased with their service over the past four years, today represented a genuine black mark on their reputation.

There's a lesson here.  This is a firm that I have loved for four years:  I have other websites (of friends, etc.) hosted with them, I recommend them to anyone who asks, they could have solicited a testimonial from me and I would have provided it enthusiastically.  But let a good client down once, and they tend to remember that more strongly than even four years of top-notch service. 

In their defense:

• I got an email from the supervisor of the server farm shortly after I noticed we were down and inquired, personally informing me of the problem, saying his team was working on it as hard as they could, and reassuring me he'd let me know as soon as it was back up; and
• When I phoned, the (random) tech support guy I got--who picked up on the first ring, which is characteristic of them--knew about the problem, evinced genuine concern, and said that everyone "had been running around working on that server problem."

Moral:  Am I thinking of switching providers?  Not on your life.  Client service can include not just coming through all the time every time, but acknowledging that one is pedalling as fast as one can when the inevitable glitch occurs. 

Still, on behalf of "Adam Smith, Esq.," I apologize for this uncharacteristic lapse.  (And, two strikes and you're out.)

Announcing the "Adam Smith, Esq." Monthly Book Review

Announcing the "Adam Smith, Esq." Monthly Book Review 

I'm pleased to announce what will be a new, regular feature here on "Adam Smith, Esq.:"  The Monthly Book Review.

What's the Monthly Book Review all about?  Here's what I have in mind:

• I'll review a book that has at least a tangential relationship to the fundamental subject of our conversation at "Adam Smith, Esq.," although I reserve the right to push our mental boundaries a bit farther afield.   Primarily, I envision covering books on (non-academic) economics, on prominent figures in the law or pieces of legal history, and also the occasional volume that just begs for wider attention.  Reader nominations for books I might review are more than welcome, but as always I reserve the right to choose what I'll write about and, as they say, "the decision of the judges is final."
• The reviews will be archived, cunningly enough, under the new "Book Reviews (Monthly)" category.
• I have zero financial interest in promoting any of the books I'll be selecting, and neither my choice of books to cover nor what I have to say is remotely for sale.  I may seek a sponsor of this feature, but even if I do they will have no influence over the selection of books or, needless to say, the content of my reviews.
• A quick synopsis of each month's book review will appear as well in the monthy e-newsletter—yet another reason to sign up if you haven't already.

So, without further preface, to this month's review.

"Spoiling for a Fight:  The Rise of Eliot Spitzer," by Brooke Masters, is this month's subject. 

Who is Brooke Masters?  According to the dust jacket:

"Brooke Masters is a staff writer for The Washington Post, based in New York, where she writes about financial services and white-collar crime. She has reported on the trials of Martha Stewart, Frank Quattrone, and Bernard Ebbers. In her sixteen years at the Post, she has also covered criminal justice, education, and politics. A graduate of Harvard University and the London School of Economics, she lives in Mamaroneck, New York, with her husband and two children."

Brooke Masters is also the quintessentially even-handed, reportorial, journalistic author:  Even-handed to a fault.  Indeed, the book's greatest failing is that she never draws her own conclusions about Spitzer; the typical reader will probably come away with precisely the view of Spitzer that they started with, an abdication of the author's prerogative to offer a reasoned opinion on a topic they have presumably become intimately familiar with.

But back to Spitzer:  In 2003, Stephen Cutler, then head of the SEC's Enforcement Division, offered a roast of Spitzer, quoting from an email Spitzer purportedly sent to the Almighty:  "Dear God," he began, "it's my understanding that you are everywhere, including, apparently, the State of New York.  As I read the Stamp Act of 1785, you are subject to regulation and taxation by the state of New York."

The barb scores two points:  Spitzer has a preternaturally broad view of his powers, and often relies on dusty and obscure statutes to achieve his ends (most famously, New York State's amazingly capacious 1921 Martin Act, an all-purpose anti-fraud enactment). 

Since the odds are staggering, barring some inconceivable meltdown between now and November, that Spitzer will be the next Governor of my home state of New York, it would be nice to learn who he really is.  Is he, on the one hand, a crusader who has stepped into a regulatory vacuum to uphold the rights of consumers and investors or, as detractors would have it, an overzealous and arrogant bully with a personal agenda that tramples the rights of defendants—and who is famously unsuccessful whenever he actually has to go to court, as opposed to conducting his prosecutions by press release and showboating press conferences?  Good question.  While it may be unfair for Masters to duck the question, I can sympathize from one perspective, at least:  When if Spitzer becomes Governor, he'll have to face a milieu completely and utterly different than any one he seems to have inhabited heretofore, meaning balanced budgets and legislative compromise.

Masters begins with what you discover is one of the best parts of the entire book:  Spitzer's upbringing.  His father, the son of an Austrian Jewish immigrant, was a self-made real estate millionaire, and Eliot and his two siblings grew up in the affluent Riverdale section of the Bronx (in the eyes of some, a spiritual annex of the Upper West Side), enrolled in private schools and submersed in progressive politics.  As a teenager, his reading tastes embraced Foreign Affairs, but not Playboy.   What life must have been like in Chez Spitzer growing up is perhaps best captured by a Princeton classmate of Spitzer's who later recounted that he had never studied as hard for a Princeton exam as he had for "dinner with the Spitzers." 

After Princeton and Harvard Law, he joined the office of Manhattan District Attorney Robert Morgenthau, and his appetite for the prosecutor's zealous reformist life was born.   And he takes to it like a true natural.

Fabulously revealing was his keynote speech before Instituional Investor magazine's annual awards dinner for top research analysts in November, 2001 at the Ritz-Carlton in Battery Park, just as the scale of the spectacular dot-com implosion was becoming clear.   Preparing for the speech, his office spent weeks compiling every buy or sell recommendation is sued by the analysts to be honored and built a database to determine how individual i nvestors would have fared by following every one.  You can imagine the result.

Came the event, and Spitzer waded right in: 

"When measured by the performance of their stock recommendations, only one of this year's fifty-one first-team all-stars included in the study ranked first in their sector...  More than 40% of this year's first-team all-stars did not perform as well as the average analyst for their sector."

As things went downhill from there, more than one guest departed muttering things along the lines of "I'm not going to sit here and listen to this s---."

He may have bearded the lion in its own den, so to speak, but at least you can say this for him:  He had the goods.

This may, indeed, be the source of Spitzer's evident political appeal.  People seem to sense that he stands for something he believes in, and that, whatever his shortcomings, he doesn't vacillate and doesn't lack vision. 

Is Spitzer in the tradition of Louis Brandeis, or of Teddy Roosevelt and other turn of the century trust-busters who were Republicans, and presumably pro-business in their hearts?  Is he trying to save capitalism from itself?  Masters points out that Spitzer has written in The New Republic that the future of the Democratic Party depends on its ability "to promote government as a supporter of free markets, not simply a check on them," and that Spitzer describes himself as a "pragmatic liberal" or "progressive—by which I mean an effort to create opportunity within the market environment."

Spitzer keeps a framed photo of TR in his office, and when asked why, responds:  "I invoke him for the notion that capitalists understand when the market needs to be tamed."

Fascinating, brilliant, intense, and driven:  Precisely the ingredients for saints, and for madmen.

Please Take the "Adam Smith, Esq." Reader Survey

Reminder to my faithful readers:  If you haven't already taken the Reader Survey, please do so.  Why?

• It takes 3 to 5 minutes, even if you get two phone calls while filling it out;
• One lucky respondent will win a $200 AMEX gift check (this is called an "incentive;" economists are fond of incentives); and
• The more readers who respond, the better I'll be able to understand—based on information, not anecdote—what you all truly want and expect from "Adam Smith, Esq."

Thanks again; and look to read about the results here shortly after Labor Day.  (The survey closes at midnight on August 31.)

"I Subscribed to the 'Adam Smith, Esq.' Monthly Newsletter But I've Never Received It!?"

A quick reminder to those of you who have signed up for my monthly email newsletter:

The service provider I'm using to distribute the newsletter ("Vertical Response") uses "double opt-in" exclusively for all their email distribution lists.

What "double opt-in" means is that you opt in, first, by actually filling out the form and hitting subscribe, and second, by replying to an auto-generated email to you coming from Vertical Response pretty much immediately following your subscription.

The problem is that by looking at the email address list, I can see that many of you (some of whom I am fortunate enough to know personally) never actually replied to the confirmatory email.  This means that, so far as Vertical Response is concerned, you are not on the list.  (They're very disciplined about this—I can't even add you manually, nor can I override your not having confirmed your subscription.)

So: If you "think" you subscribed—and you probably did!—make sure you replied to the confirming email.

The confirming email:

• is from "Adam Smith, Esq."
• with a subject line that reads "Confirm Your Subscription to the "Adam Smith, Esq." Newsletter", and whose body copy reads in its entirety:
• "Thanks for subscribing to the "Adam Smith, Esq." newsletter! To confirm that it was actually you at this email address, please click the following encrypted link to validate your membership:

  http://oi.vresp.com/confirm.html?fid=[special unique autogenerated number]

Since the newsletter covering July will be coming out in the next few days, please don't be left out!

"Adam Smith, Esq." Reader Survey: Please Participate

Those of you who have both long memories and who are long-time visitors to "Adam Smith, Esq." may recall that I did a Reader Survey a little over a year ago to learn more about you and your interests and how I can make the site even more valuable to you.

It's back!—and it's improved. 

For starters, everyone who completes the Survey will be able to enter (it's up to you) to win a $200 Amex gift check.  The winner will be selected at random from all entrants by our panel of impartial judges (that would be me, aided and abetted by the trusty random-number-generator function in Excel).   Why am I doing this?  I want to encourage participation and response; and I happen to be a believer in incentives (which you already knew).

If you took the Reader Survey before, I invite you to take it again.  Not only has it changed, but you may have changed as well—with a slightly different emphasis in your interests, or with a new and different Big Challenge facing your firm (I do ask about that, point-blank).  If you never took Reader Survey #1, this is your chance.  I'm fascinated to learn what you care about, so please take a moment to share your thoughts; I value them.

Rules of the Road:

• All of your information will be held strictly confidential, and I will never publish or share any individually identifiable responses.
• The survey will be open for the month of August, closing at midnight on August 31, so don't dawdle.
• It will take three to five minutes to complete, depending on how voluble you want to be in adding comments.
• A complete summary and report on the results will be available right here shortly after Labor Day—so if you don't participate, you cannot complain if there's a result you dislike.

Click here to get started.  And best of luck to all on the Amex gift check.

Happy 4th of July!

And a Happy Fourth of July to one and all.

(A shot I took one year ago tonight, from Battery Park City towards the Statue of Liberty.)

The "Adam Smith, Esq." Monthly Newsletter: Please Sign Up

You may have noticed that about three months ago I launched a new feature here at "Adam Smith, Esq.:"  A free monthly e-mail newsletter, This Month's Best from "Adam Smith, Esq."

I intend it as a concise, pithy summary of a few of the more trenchant, widely-read, controversial, or just plain entertaining entries of the past month.   The first few issues have recapped and linked to the leading stories of the past month, and occasionally serendipity has uncovered common themes I was unaware of as I composed each separately.

I guarantee the newsletter will be family-friendly—and suitable for forwarding to colleagues and friends.

So how's it going, and why am I mentioning this now?

First of all, I am pleased to report that in barely 10 weeks' time the subscriber list has grown to over 500 individuals from all corners of the English-speaking legal world.   Moreover, it's a remarkably sophisticated and high-caliber group, judging from my quick scans of the names, positions, and firms the subscribers are from:  Nearly 10% are Managing Partners or Firm Chairs. 

 Anecdotally, I was meeting the Executive Director of an AmLaw 50 firm recently, and I happened to have noticed that the Chair of his firm was a subscriber; when I mentioned this to him, his reaction, as a non-subscriber, was memorable.

Second, while the newsletter began life as a handy summary and collection of the "greatest hits" of "Adam Smith, Esq." during the prior month, I plan on introducing new content into the newsletter each month which will not be published on the site and will thus be available only to subscribers.  By doing this, am I tipping my hand that I really really want you to sign up?  Well, yeah:

• It's free; and
• I will never compromise your information; it will remain confidential.

So what have you got to lose? 

Please join this special "Adam Smith, Esq." community today.  And, while you'd immediately regret such a rash and impulsive act, you can of course "unsubscribe" through a link at the end of each and every newsletter.

See you next month in your inbox!

The Dismal Science at Age 230

"The dismal science?"  You won't be surprised to hear that that's about the last way I'd describe the art and discipline of economics, and a new book, Knowledge and the Wealth of Nations, reviewed by Paul Krugman in yesterday's Sunday Times Book Review sounds like a wonderfully exciting intellectual exploration of why I believe economics retains its ability to fascinate as it attempts to explain how people, ideas, and things interact to try to produce value.

 The author, David Warsh, a former economics correspondent at the Boston Globe, Forbes, and The Wall Street Journal, writes the online weekly, "Economic Principals."  The book tells the story of how academic understanding of increasing returns to scale, and indeed of growth itself, was revolutionized in the past few decades by introducing the concept of knowledge itself as a factor of production, at long last joining the classical triumvirate of land (a/k/a tangible resources), capital, and labor.

When a book gets advance praise like this, the reason I continue to adore economics should be clear:

“Romer’s understated but earth shattering work deserves our attention and a Nobel prize in economics.”
— John Doerr, partner, Kleiner Perkins Caufield & Byers

Copyright Law, "Fair Use," and Why You Can Still Read My Analyses of The AmLaw 100 Statistics

As loyal readers know, I had a nasty brush with copyright law and the ALM Media inhouse law department this past Monday. 

In a nutshell, after spending part of the weekend generating four pieces on the 2006 AmLaw 100 (released last Friday)—here, here, here, and here—first thing Monday I returned a phone call from an assistant general counsel at ALM Media who proceeded to tell me that everything I'd written violated their copyright in the AmLaw 100 and that I must take it all down forthwith.

I did not, and I did what any lawyer with himself for a client would advise:  Call in the experts.

The good news is I learned a lot about copyright and fair use thanks to the superb counsel and advice I was able to draw upon, ranging from nearly a dozen readers, many of whom I'd never heard from, who offered their thoughts in personal emails (which were without exception generous and supportive) to a few friends who happen to be IP lawyers, to another friend who's the heaviest hitter of all in this area, as General Counsel of a major publicly-traded media organization.  (You know who you are.)

Consider what follows, then, a small effort to repay the collective efforts of the blogosphere, and an attempt to memorialize what I learned in hopes it might be useful in future to someone finding themselves in a similar situation.

One motivation for doing this is the remark of an IP practitioner and friend who, unsolicited, volunteered the opinion that "There are entire in-house law departments devoted to sending out legally unjustified cease and desist letters." And the truly bad news is not that dismaying commentary on the paucity of ethics, but his additional observation that far more than half the time, threats work.

For starters, my law school alma mater has a much-more-than-decent guide to fair use online.

But to get to "primary sources," the leading cases hereabouts are Feist Publications, Inc. v. Rural Telephone Service Co., 499 U.S. 340 (1991) and Harper & Row v. Nation Enterprises, 471 U.S. 539 (1985).

Feist was a dispute over whether Feist, a directory publishing service, could copy telephone-book white page listings from Rural Telephone's directories and reproduce them in its own directories.  As Justice O'Connor felicitously put it:

"This case concerns the interaction of two well-established propositions. The first is that facts are not copyrightable; the other, that compilations of facts generally are. Each of these propositions possesses an impeccable pedigree."

"facts do not owe their origin to an act of authorship. The distinction is one between creation and discovery: the first person to find and report a particular fact has not created the fact; he or she has merely discovered its existence. [...] Census-takers, for example, do not "create" the population figures that emerge from their efforts; in a sense, they copy these figures from the world around them."

Compilations of facts, on the other hand, may possess originality, but since facts themselves do not become original through association together, "This inevitably means that the copyright in a factual compilation is thin."

The heart of the distinction is explained thus:

"No matter how much original authorship the work displays, the facts and ideas it exposes are free for the taking . . . . The very same facts and ideas may be divorced from the context imposed by the author, and restated or reshuffled by second comers, even if the author was the first to discover the facts or to propose the ideas.

"It may seem unfair that much of the fruit of the compiler's labor may be used by others without compensation. As Justice Brennan has correctly observed, however, this is not "some unforeseen byproduct of a statutory scheme." Harper & Row, 471 U.S., at 589 (dissenting opinion). It is, rather, "the essence of copyright," ibid., and a constitutional requirement. The primary objective of copyright is not to reward the labor of authors, but "to promote the Progress of Science and useful Arts." Art. I, § 8, cl. 8. Accord Twentieth Century Music Corp. v. Aiken, 422 U.S. 151, 156 (1975). To this end, copyright assures authors the right to their original expression, but encourages others to build freely upon the ideas and information conveyed by a work. Harper & Row, supra, at 556-557. This principle, known as the idea-expression or fact-expression dichotomy, applies to all works of authorship. As applied to a factual compilation, assuming the absence of original written expression, only the compiler's selection and arrangement may be protected; the raw facts may be copied at will. This result is neither unfair nor unfortunate. It is the means by which copyright advances the progress of science and art. "

"Making matters worse, these courts developed a new theory to justify the protection of factual compilations. Known alternatively as “sweat of the brow” or “industrious collection,” the underlying notion was that copyright was a reward for the hard work that went into compiling facts. The classic formulation of the doctrine appeared in Jeweler's Circular Publishing Co., 281 F., at 88:

“The right to copyright a book upon which one has expended labor in its preparation does not depend upon whether the materials which he has collected consist or not of matters which are publici juris, or whether such materials show literary skill or originality, either in thought or in language, or anything more than industrious collection. The man who goes through the streets of a town and puts down the names of each of the inhabitants, with their occupations and their street number, acquires material of which he is the author” (emphasis added)."

"The “sweat of the brow” doctrine had numerous flaws, the most glaring being that it extended copyright protection in a compilation beyond selection and arrangement -- the compiler's original contributions -- to the facts themselves. Under the doctrine, the only defense to infringement was independent creation. A subsequent compiler was “not entitled to take one word of information previously published,” but rather had to “independently work out the matter for himself, so as to arrive at the same result from the same common sources of information.” Id., at 88-89 (internal quotations omitted). “Sweat of the brow” courts thereby eschewed the most fundamental axiom of copyright law -- that no one may copyright facts or ideas. See Miller v. Universal City Studios, Inc., 650 F. 2d, at 1372 (criticizing “sweat of the brow” courts because “ensuring that later writers obtain the facts independently . . . is precisely the scope of protection given . . . copyrighted matter, and the law is clear that facts are not entitled to such protection”)."

"[D]id Feist, by taking 1,309 names, towns, and telephone numbers from Rural's white pages, copy anything that was “original” to Rural? Certainly, the raw data does not satisfy the originality requirement. Rural may have been the first to discover and report the names, towns, and telephone numbers of its subscribers, but this data does not “'owe its origin'” to Rural. Burrow-Giles, 111 U.S., at 58. Rather, these bits of information are uncopyrightable facts; they existed before Rural reported them and would have continued to exist if Rural had never published a telephone directory."

So the handwriting of the holding is on the wall, as it were:  Feist did not infringe Rural's copyright:  "copyright rewards originality, not effort."

The other case, Harper & Row v. Nation, has a much sexier set of facts.  But the real reason we're interested in it is that it's the primary authority on the parameters of "fair use."

Shortly after President Gerald Ford left office, he negotiated a book deal for his memoirs with  Harper & Row, which subsequently sold pre-publication rights of an excerpt dealing with Ford's pardon of Pres. Nixon to Time magazine for $25,000.   About ten days before the Time excerpt was to run, The Nation magazine (under the famous Victor Navasky) obtained a purloined draft of the Ford memoir and published a 2,500-word story on it, deliberately scooping Time and lifting 300-400 words verbatim, albeit of course with attribution, from the Ford memoir.  Time magazine promptly cancelled the story and refused to pay the second half of the $25,000, which was still owing.  Harper & Row then sued The Nation for copyright infringement.

The Southern District of New York (557 F. Supp. 1067 (SDNY 1983)) found for Harper & Row and rejected The Nation's defense of "fair use."

The Second Circuit reversed (723 F.2d 195 (2d Cir. 1983)), endorsing the defense of "fair use" and finding under the four tests enumerated in the Copyright Act (17 U.S.C. § 107), as follows:

• the purpose of the article was "news reporting,"
• the original work was essentially factual in nature,
• the 300 words appropriated were insubstantial in relation to the 2,250-word piece, and
• the impact on the market for the original was minimal.

The Supreme Court, in turn, reversed again, rejecting The Nation's "fair use" defense.  Its discussion of the four factors is the heart of the opinion.

• Purpose of the Use:  In general (there are no bright lines here—this is an "all the facts and circumstances" inquiry), nonprofit uses are favored over for-profit ones, news reporting and other "productive" uses are favored, and a "true scholar" is favored over "a chiseler."
  
• Nature of the Copyrighted Work:  The law "recognizes a greater need to disseminate factual works than works of fiction or fantasy," presumably on the theory that facts educate regardless of where they originated whereas fiction or fantasy is at its core the expression of the author.  Also critical in Harper & Row was that the Ford memoirs were unpublished when The Nation purloined them:

  "While even substantial quotations might qualify as fair use in a review of a published work or a news account of a speech that had been delivered to the public or disseminated to the press, see House Report at 65, the author's right to control the first public appearance of his expression weighs against such use of the work before its release. The right of first publication encompasses not only the choice whether to publish at all, but also the choices of when, where, and in what form first to publish a work."

• Amount and Substantiality of the Portion Used:  This is perhaps the single one of the four "tests" that most readily comes to mind when discussing fair use, but it needs to be stressed that the emphasis on the qualitative "substantiality," not the quantitative "amount:"  As the Supreme Court put it, "In absolute terms, the words actually quoted were an insubstantial portion of "A Time to Heal." The District Court, however, found that '[T]he Nation took what was essentially the heart of the book.' [...]  A Time editor described the chapters on the pardon as 'the most interesting and moving parts of the entire manuscript.'"
  
  The fact that the purloined 300-400 words were certainly less than 1% of the memoir manuscript, in other words, cuts no ice.
  
• Effect on the Market:  Finally we get to my favorite test, the economic impact of the alleged infringement, and the Supreme Court evidently is of the same view:  "This last factor is undoubtedly the single most important element of fair use."  Indeed, quoting the estimable Nimmer, they say "Fair use, when properly applied, is limited to copying by others which does not materially impair the marketability of the work which is copied."
  
  Since Time reneged on its agreement to pay the second installment of royalties to Harper & Row, the economic impact here was obvious. But the Court went further:

  "More important, to negate fair use, one need only show that, if the challenged use "should become widespread, it would adversely affect the potential market for the copyrighted work." Sony Corp. of America v. Universal City Studios, Inc., 464 U.S. at 451 (emphasis added)"

  In other words, courts will consider not just the isolated alleged infringement, but how the world would look if they approved a pattern of same.

Held:

"The Court of Appeals erred in concluding that The Nation's use of the copyrighted material was excused by the public's interest in the subject matter. It erred, as well, in overlooking the unpublished nature of the work and the resulting impact on the potential market for first serial rights of permitting unauthorized prepublication excerpts under the rubric of fair use. Finally, in finding the taking "infinitesimal," the Court of Appeals accorded too little weight to the qualitative importance of the quoted passages of original expression. In sum, the traditional doctrine of fair use, as embodied in the Copyright Act, does not sanction the use made by The Nation of these copyrighted materials."

Applied to what I did here on "Adam Smith, Esq." last weekend with the AmLaw 100 statistics, I concluded that my use of their non-copyrightable facts advanced knowledge and was newsworthy in its own small way, that I did not deprive them of any publication rights of their own, and that my analysis of their raw data increased, if anything, the economic value of their initial listing.

Again, I would like to humbly and graciously thank all those who contributed to my education on this topic.   My devout hope is that this piece will help, in some small way, a future target of a claim of copyright infringement to understand the pertinent law and to govern their behavior accordingly.

Justice in the Blogosphere

It is with pleasure and relief that I can report that I plan to leave all of my analyses of the raw AmLaw 100 statistics (here, here, and here) up on "Adam Smith, Esq." despite ALM Media's request that I take them down as violative of their copyright.

The blogosphere is justly famous for constituting an on-demand network of "collective intelligence," and it has confirmed that reality in spades for me over the past 24 hours.  I've had the benefit of the counsel of nearly a dozen IP and non-IP lawyers, including the general counsel of a major media outlet, and have concluded that my reinterpretation and manipulation of the AmLaw figures is well within my rights to publish.

Thank You, David Maister

And welcome to the blogosphere; can it have been only two months since you started?

For any of you out there who haven't stopped by David's site, don't waste another moment. Yet another inspiring example of how the blogosphere beats the Mainstream Media for timeliness, precision, trenchancy, insight, and unparalleled expertise—in a walk.

Last Call To Sign Up for the March Newsletter

Last call to sign up for the "Adam Smith, Esq." monthly newsletter in time to get the March, 2006 inaugural issue.  Just go to the site if you're not there already, and look in the right-hand column for the oblique headline, "Subscribe to the free monthly e-mail newsletter, This Month's Best from "Adam Smith, Esq."

Indiana University Law School's Symposium on Globalization

Thursday, April 6, I'll be participating in Indiana University Law School's "Globalization Conference," organized by my good friend Prof. William Henderson.  From the summary of the symposium:

"Much has been written on the process of globalization and its effects on international and individual state law. The impact of globalization on the legal profession has received far less systematic attention, despite a universal recognition that the practice of law and the economic and personal lives of lawyers may be on the brink of profound transformation.

"The purpose of this unique symposium is to initiate dialogue about how globalization is fundamentally changing the work lives and professional opportunities of lawyers in the U.S. and abroad. Prominent figures in the global legal industry will explore various interrelated themes on the issues facing legal profession, including law firm strategy, the relevance of geography, the lawmaking role of transnational lawyers, and how cultural norms affect or shape our perceptions of ethical lawyering. The program will include presentation of scholarly papers and responses by symposium participants."

Some of those participating include R. Bruce McLean, Chairman of Akin-Gump, Patrick McKenna of Edge International, Larry Ribstein. and yours truly.

You can register here ($50 for IU alumni, $100 for everyone else) and find out how to get to Bloomington here.   Earn CLE credit (woooheee!).

Having been to Bloomington previously and enjoyed the Law School's hospitality, I can report that it is a quintessential Midwestern college town, with the brick sidewalks, shady avenues, frat-house row, and surfeit of used bookstores that are de rigueur. 

Barnes & Noble: 1:00 pm

Tag-Team (Nailed Twice!)

Having been tagged by both David Maister and Robert Millard, the handwriting is on the wall: I can't hide, and I've never been one to run. So you are about to experience an extraordinarily atypical entry on "Adam Smith, Esq.," which is not now, and never has been, about me.

Four jobs I've had:

• caddy (one summer)
• research assistant (as a 3L) to constitutional law professor Paul Brest, later Dean of Stanford Law School
• founder and CEO of a dot-com (intended to bring the Fortune 1000 and the AmLaw 200 together for spontaneous and serendipitous "expertise discovery"—essentially meant as a massive online legal KM application)
• strategic and economic consultant to law firms

Four movies I can watch over and over

• The Godfather (I, II, & III)
• Star Wars
• The Hunt for Red October
• 2001: A Space Odyssey

Four TV shows I love to watch

• The NewsHour with Jim Lehrer (PBS)
• Charlie Rose (if and only if he's not interviewing movie celebrities)
• Monday Night Football
• NOVA

Four places I’ve been on vacation

• Bologna/Milan/Rome/Venice
• Florence/Siena/Assisi/Ravello
• Positano/Capri/Amalfi/Ravenna
• Palermo/Agrigento/Erice/Catania/Siracusa

Yes, you detect a pattern.

Four tunes that play through my head

• The Siegfried Idyll from Wagner's Ring Cycle
• Le Donne e Mobile from Verdi's Rigoletto
• "Private Dancer," Tina Turner
• "London Calling," The Clash

Four favorite dishes

• cheese, olives, bread, red wine: the Four Major Food Groups
• risotto
• home-made parmesan/rosemary/sun-dried tomato focaccia
• inky black coffee and an honest-to-God New York bagel with nova and a schmear

Four books I really love

• The Great Gatsby, F. Scott Fitzgerald
• The Selfish Gene, Richard Dawkins
• Harry Potter: All of it
• [An Inquiry into the Nature and Causes of] The Wealth of Nations, Adam Smith (yes, seriously)

Four places I’d rather be

• London, Hong Kong, or Rome
• Running a full loop of Central Park
• Most any world-class university town: Ann Arbor, Cambridge, Palo Alto, Princeton
• Seated in the third row, center, of the balcony of the Metropolitan Opera as the house lights go down

But seriously, David M. nailed it: Home on the Upper West Side.

Four bloggers I’m tagging

• Bruce Marcus
• Malcolm Ryder
• Ernie Svenson
• The Wired GC

And there you have this most out-of-the-ordinary entry on "Adam Smith, Esq."

Do As They Say...

Law.com's "Legal Blog Watch" caught the announcement of the monthly "Adam Smith, Esq." newsletter and sums it up in words I can't improve upon:

Adam Smith, Esq. to your in-box

Bruce MacEwen is kicking off a monthly newsletter that highlights some of his best posts from Adam Smith, Esq., and it's free. Why do I bring you this news? Because from where I sit, several things are clear:

• Lawyers like "push" technologies (e-mail newsletters, RSS, etc ...).
• Bruce is a prolific poster on his blog, which is a must-read for partners and those aspiring everywhere.
• Because of above item, No. 2, Bruce has so much analysis that it's hard to keep up with it all, thus making a newsletter particularly useful.

Sign up!

What more can I say?  Take their advice.

Announcing "This Month's Best of 'Adam Smith, Esq.'" Newsletter

Announcing something new and different on "Adam Smith, Esq.:"  A free monthly email newsletter delivering "This Month's Best of 'Adam Smith, Esq.'"  fresh to your inbox at the end of each month.

The newsletter will consist of links to, and concise, pithy summaries of a few of the more trenchant, widely-read, controversial, or just plain entertaining entries of the past month (in your humble editor's opinion). Suitable for sharing with friends, and guaranteed to be family-friendly.

You can sign up for it in the right-hand column (scroll down a bit—and you folks on RSS feeds, pay a visit to the site itself) under the cunning heading, "Subscribe to the free monthly email newsletter...."

I do ask for a bit of info about you, the better to keep building the "Adam Smith, Esq." community, but if you think for a second that I would share one byte of that with anyone else, well, all I can say is I'd have to be well and truly off my med's to have the thought cross my mind.  Don't even think about it; won't happen.

The first e-issue will be out after the end of March. 

I hope you all enjoy!

The London-Based "PM Forum" and Blogs as Professional Communities

Nadia Cristina, Managing Editor of London-based pm magazine, who was gracious enough to agree to an interview when I was over there last fall, just forwarded one of the fruits of that meeting to me, an article I co-authored with Bruce Marcus titled "Blogs—The new community of interests."   The thrust of the article is simple:

"The power of blogs derives from their online essence: available and update-able 24/7, with global reach, they are tailor-made for targeting narrow and usually passionate niche interests.  They rapidly reach an audience of participants that would be completely impractical to reach in the offline world, thereby constituting a collective intelligence of enormous professional value."

"The PM Forum is a 4,000 strong regionally-based members' association, formed in 1996, dedicated to raising the standards of professional services marketing and to enhancing the credibility of marketers working in professional service firms worldwide."

So enjoy the article, and explore PM Forum.  (Thanks again, Nadia!)

"The Magic Middle"

Every once in awhile, it pays to stand back and reflect for a moment on the "Adam Smith, Esq." community—yes, dear reader, that means you.

The more involved I've become with "Adam Smith, Esq.," and the more readers I've heard from and even met in the real world, the more I've come to think of it not as a "blog" but as a publication, with all of the responsibility for accuracy, even-handedness, and citation of original source material, that that entails.  As the managing partner of an AmLaw 25 firm said to me, "The difference between you and The American Lawyer is that you publish a couple of dozen times a month."  [And there's a nontrivial difference in the cost of a subscription, but I chose to be kind and avoid pointing that out.]

Have I, then (horrors!), become "Mainstream Media"?!

Wrong question, at least if you believe David Sifry, founder and CEO of Technorati, the first and in many ways still the best search engine dedicated to blogs.  In a thoughtful and, blessedly, data-rich post, Sifry points out that some famous blogs, including the ubiquitous Boing Boing, have professional journalists on staff.  Other sites which he classifies as "MSM," including Slashdot, let readers spontaneously create and populate their content. 

The point is that the line between the MSM and the blogosphere is blurring, particularly as we gain more experience with what I think of as "Blogs 2.0:"  Sites, like "Adam Smith, Esq.," that are professionally produced, directed at a focused target audience, and (so people tell me) offer content equivalent in quality and analytic rigor to anything to be found offline in more conventional media addressing the same topics.

That said, blogs are never going to supplant The New York Times or CNN, as this handy little graphic makes clear:

It's also overly simplistic to conclude, as the hypothesis of "The Long Tail" would have it, that you're either on the A-List, read by millions, or you're nowhere.   Going just a very short distance further down the popularity distribution curve shows blogs gaining a lot of real estate on the MSM:

Sifry calls sites that are neither on the A-list nor irrelevant The Magic Middle of the attention curve:

"This realm of publishing highlights some of the most interesting and influential bloggers and publishers that are often writing about topics that are topical or niche, like Chocolate and Zucchini on food, Wi-fi Net News on Wireless networking, TechCrunch on Internet Companies, Blogging Baby on parenting, Yarn Harlot on knitting, or Stereogum on music - these are blogs that are interesting, topical, and influential, and in some cases are radically changing the economics of trade publishing. [...] 

"And what is so interesting to me is how interesting, exciting, informative, and witty these blogs often are. "

So it's official:  You are a subscriber in good standing to "The Magic Middle."  And "Adam Smith, Esq." is a publication in every sense intended by that moniker.

The Blogosphere & The Mainstream Media, or What to Do If You're Misinterpreted

We pause for a time-out to consider a metaphysical question:  Is blogging journalism, and whether or not it is, to what standards of accuracy and precision should it be held?

Actually, I have no intention of trying to answer these questions as posed.  What I will offer is my bedrock belief that:

• Sites such as "Adam Smith, Esq." constitute a new breed of publication, with no possible or conceivable analogue in the off-line world (imagine The American Lawyer publishing a couple of dozen times a month, to a globally distributed audience, and reaching them in milliseconds).
• Professionally produced and serious-minded sites ("Adam Smith, Esq.," I would like to believe, qualifying for inclusion in this category) can create and sustain a community of like-minded people who share focused interests which, again, it would not be feasible to aggregate in the off-line world.
• Speaking for myself, I always intend to hold "Adam Smith, Esq." to the highest possible standards of factual accuracy, tonal fairness, and analytic rigor.  I fervently welcome, and will hasten to publish, any factual amendments or corrections of misimpressions unintentionally generated.  The "letters to the editor" box is open!

Why am I saying this now?

Because of an article by my good friend Thom Weidlich of Bloomberg News, now appearing in The International Herald Tribune, about Shearman & Sterling.  The headline, which accurately sums up the thrust of the article is:  "As partners leave, law firms tries to stop others from following suit," and in it I am quoted in this context: 

"Shearman & Sterling continues to play at the top table in terms of its M&A and finance practice," said Kenneth MacRitchie, the firm's London managing partner. "But its profitability is significantly divergent from other law firms playing at that top table. And that is something that is becoming more and more obvious and something that has to be dealt with."

"MacEwen said partnerships must pay more attention to profitability. He cited as a cautionary tale Coudert Brothers, a 152-year-old, New York-based partnership that dissolved last year. Coudert's average profit per partner was 99th among the 100 highest-grossing U.S. law firms, according to American Lawyer magazine.

"While MacEwen said Shearman & Sterling is nowhere near Coudert's predicament, its profit per partner is overshadowed by that of New York firms like Sullivan & Cromwell, Davis Polk & Wardwell and Debevoise & Plimpton, the rankings show."

Now, how one reads that is susceptible to (at least) two interpretations:  (1)  S&S, as MacRitchie recognizes, has a profitability problem "that has to be dealt with," and I allude to Coudert only to call the reader's attention to the worst-case, melt-down scenario.   (2) Despite the "nowhere near" phrase, I'm implying that S&S could face Coudert's sad fate.

For the record, as people in my suddenly-awkward position will say, interpretation #(2) was and is the furthest thing from my mind.   Not having seen the article before it was published (which is journalistic standard operating procedure, as it should be, and to which I take zero exception), all I can say now is that I wish I had emphasized more strongly in my conversation with Thom how fundamentally sound and stable S&S is, and how firm is my belief that they'll accelerate out of this dip and be the better for it.   But evidently I did not—perhaps I assumed it was so obvious it need not be stressed—so there the article lies.

Is there a moral to this?  I believe so:  The power of the blogosphere is, among other things, its flexibility and power to lithely respond. 

I plan to submit a truncated version of this to the editor of the IHT, but even if he chooses to publish it, it will be tomorrow at best, and with no assurance readers of Thom's original piece will see it.

A last word:  Thom, you did nothing wrong, and I continue to count you a crack reporter.  The default in clarity was entirely mine.

Update: 16 Feb 2006, 1:05 pm

Here is the verbatim text of a letter to the editor of the International Herald Tribune which I emailed last night:

15 February 2006

Re: “As partners leave,…” (IHT Business Section, 15 Feb 2006)

via email: letters@iht.com

To The Editor:

As the law firm consultant quoted in “As partners leave,…”, I am impelled to correct the article’s astonishing implication that I could analogize the financial speed bump Shearman & Sterling hit to the sad, protracted demise of Coudert Brothers. The circumstances and events that led to Coudert’s closing its doors were years, if not decades, in the making, whereas S&S just yesterday provided convincing evidence that it has already accelerated out of its soft patch, with year-over-year revenue up 7% and profits per partner up 20%. These are not numbers posted by sick ward firms.

In alluding to Coudert in my conversation with the reporter, I merely intended to point out that, in a business of elevator assets, both vicious and virtuous cycles are extremely real phenomena, and a firm on the ascendancy can go from strength to strength, as higher-value work boosts revenue and profitability, attracting the cream of both legal practitioners (supply) and clients (demand). The reverse equally obtains.

I fully accept the possibility that I assumed that to any modestly informed observer the fact that S&S/day and Coudert/night are so obviously worlds apart meant that it need not be stressed: But let me loudly stress it now.

Bruce MacEwen

New York

Does Italy Recognize a Right of Privacy?

File this under "Truly Useful."

Charles Glasser, Jr., Media Counsel at Bloomberg News, has just published the "International Libel & Privacy Handbook," subtitled "A Global Reference for Journalists, Publishers, Webmasters, and Lawyers."  As the reach of print, broadcast, and of course online media becomes worldwide, ignorance about the libel and privacy laws of seemingly far-away jurisdictions is no longer a viable option.

Glasser has put together certainly the most up-to-date and comprehensive, if not the first and only, nation-by-nation summary of these laws, written by legal experts in Europe, Asia, and the Americas, and concluding with a section on "Issues of Global Interest," including a cross-reference chart, discussion of special issues for book publishers, enforcing foreign judgments, and fair use (guess what?—it "stops at the border").

As Floyd Abrams says (and if you don't know who he is, you don't need to worry about media law),

"At long last, we can now compare on a nation-by-nation basis how countries in the Americas, Asia, and Europe deal with libel and privacy issues and how that treatment differs from that of the United States.  This book offers a sophisticated and reader-friendly response to the core questions that any practitioner frequently must consider."

Not available on Amazon, you can buy it through Bloomberg Books.

Stepping Out

"Adam Smith, Esq." is branching out.

Through a happy confluence of inspiration and opportunity, Bruce and the "Adam Smith, Esq." brand are stepping out from behind your screen into the off-line world:

First, I am pleased to announce the kick-off of what I hope will be an on-going series of high-end workshops for senior law firm management.  Working with Rich Gary, former chair of Thelen-Reid, these will feature a small group of attendees delving into strategic business issues that managing partners and their colleagues are wrestling with.   We will hold these workshops in major cities in the US, and they will typically take place over two days, starting with a cocktail reception and dinner on a Wednesday evening and adjourning after lunch Friday.  The workshops will include:

• Three focused modules dealing with important challenges to executives at the top of large and sophisticated law firms, such as "consolidation and globalization," "competitive and business intelligence," "leading change," and "creating a credible, powerful, and distinctive 21st-Century firm."
• The format will include presenting novel and substantial content; engaging the attendees in round-table discussions; "what-if" scenarios and thought experiments, both in break-out groups and as a whole; and learning from and interacting with some of the legal profession's  most prominent thought leaders, who will attend as our guests.

We hope the combination of a small group (no more than 15 attendees) in intimate surroundings, together with challenging thinking and interaction with some of the thinkers at the cutting edge of our profession, will make these workshops distinctive.

For more information, see the link in the left sidebar to "Workshops," or click here.

Second, I am offering "Law Firm Finance 101," 1/2-day seminars that I will conduct at your firm's offices, targeted at small groups of associates (partners invited as well!).  These were partly prompted by the overwhelming reaction to an entry from last September, "Name the Missing Law School Course." 

“Law Firm Finance 101” will enable associates to:

• approach their careers with more awareness of what’s expected of them;
• make a connection between their daily work and the firm’s strategic goals;
• appreciate the firm’s business decisions;
• understand what drives the metrics by which they’ll be evaluated, and
• be more realistic about attorney-client and partner-associate relationships,

all with the goal of making them more valuable to the firm more rapidly.

For more information, see the link in the left sidebar to "Workshops," or click here.

Third, my business manager and I are establishing an on-line research panel and inviting our loyal readers to join.  To ensure objectivity of the research results the panel will generate, we have teamed up with a leading independent, third-party on-line research company, "Affluent-Dynamics."   Fundamentally, the goal of the panel is simple:  To give readers who join the opportunity to have a voice which will be heard and listened to by companies developing products and services you use. 

If you're interested in "having your opinions count" on a variety of business and marketing issues, or if you're merely curious, click on the Affluent Dynamics box.   Membership is free, absolutely confidential, and every time members complete a survey, they receive a minimum of 3,000 frequent flier miles. And by the way, membership is not limited to the U.S.; indeed, non-Americans are more than welcome (the only requirement is English fluency.)

I'll keep a separate link up to the Affluent-Dynamics panel for the next week.

Finally, "Adam Smith, Esq." is accepting advertisements and sponsorships from a select few high-end marketers with products or services presumably of interest to "Adam Smith, Esq." readers.  One example is the ad for Sivin-Tobin Associates, LLC, legal recruiters headquartered here in New York.

The purpose of this program is to help strengthen the long-term viability of "Adam Smith, Esq.," and, I hope, to enable me to invest in developing additional, original content through on-site reporting and research.

That said:  Our marketing and advertising partners will never have the remotest influence on what you read here—and any with the poor judgment to seek it will be summarily, and publicly, dismissed with all the opprobrium the blogosphere can muster.

Anyone interested in discussing the wide array of customized programs—encompassing both online and off-line elements—which my business partner has developed, or who has suggestions or questions, should email Janet Stanton.   Janet is a true pro at what she does, with over 25 years experience in advertising and marketing, working with such household names (and sophisticated marketers) as Procter & Gamble, Colgate-Palmolive, Nortel, Pfizer, Johnson + Johnson, and the US Department of Defense; she has worked at prominent NYC ad agencies including Bates Worldwide, Benton & Bowles, and Grey, as well as being President of a mid-sized agency outside Philadelphia.  If you talk to her, you'll be in good hands.

And editorial questions/suggestions/inquries should, as always, come to me.

I hope you appreciate the reasons behind my expanding what "Adam Smith, Esq." stands for and what it delivers, and I hope you share a small bit of my excitement at these new developments.

The Way-Back Machine

Back in February, 2005 I authored the following piece:

Who Will Be Your Successor?

Succession planning is part of the Management 101 toolkit that law firms ignore at their peril.  Too many firm leaders are reluctant to attend to it, either intentionally ("it will all work out") or simply through preferring not to take up a potentially contentious, personality-intensive issue so long as there seems no urgency to it.  Of course, once it's urgent it's too late.

These observations are not academic.  I had the happy experience of being an associate at the late, great firm of Shea & Gould here in New York when it was in its heyday, but after both Bill Shea and Milton Gould retired in their 70's, the firm ultimately dissolved for want of strong and uniting management—a death that could have been avoided.*  Thinking about succession planning is also timely:  We've recently learned that Testa-Hurwitz is no more, two years after the sudden death of marquee founder Dick Testa, and my recent piece about Jay Zimmerman's leadership at Bingham-McCutchen shows the flip-side:  That good, not just bad, things can happen when a new leader steps in. 

So bravo to Larry Sonsini of Wilson-Sonsini for handing the CEO keys to John Roos.  Roos, who's been at Wilson-Sonsini as a corporate attorney for 20 years, is currently the managing director of professional services and, in the small world department, a friend of mine from Stanford Law School days.  (Yes, I have already congratulated him, and he has graciously and self-effacingly replied.)   Aside from my own delight at John's well-deserved elevation, why do I hold this out as a model of succession planning?  Consider:

• Sonsini didn't have to do this now; he's only 64 and clearly in a position to remain on the throne for as long as he chooses.
• Wilson-Sonsini may be at something of a strategic inflection point.  While it is pre-eminent in technology and venture capital circles, and sizable by any standard (600 lawyers, #46 on the AmLaw 100), it's heavily Bay Area-centric:  Palo Alto and SF aside, none of its offices has more than 30 attorneys.  If they aspire to be a Latham & Watkins or an Orrick, a different approach is called for.
• Sonsini has not attempted to clone himself and appoint a mirror-image successor:  Instead, he has self-consciously moved to "institutionalize" (his word) management.  While Roos becomes CEO, Jeffrey Saper, now managing director of business development, will become vice chairman and focus on client development.

John sums up the change with pith:  "We are a major company that needs full-time management." 

GE has been written about in the management literature as a virtual finishing school for CEO's.  AmLaw 100 firms could do worse than taking a page from that playbook.

*Trivia fact: Bill Shea is the "Shea" in Shea Stadium. Huuuh? you ask. After the Dodgers decamped from Brooklyn to LA, New York was for some time without a National League baseball team. Eventually Major League Baseball got around to talking about giving an "expansion" National League team to another city--but not to New York! Bill Shea, who was unbelievably well-connected politically, started a movement to create a third, new baseball league, the Continental League, and planned, of course, to award this new league's first franchise to New York. The National League blinked, New York got the Mets, and Bill got his stadium.

Comes now F. Scott Shea, an associate at Bingham-McCutchen, to "amend and extend" my remarks:

"For what it is worth, the info in your "Who Will Be Your Successor - February 8, 2005" is a little factually incorrect and somewhat misleading.

"Both Milton Gould and Bill Shea worked into their respective 80's. Bill having a stroke in 1991 at 84 on his way home from work, and Milton, retiring shortly thereafter, with the dissolution coming in February of 1994. Secondly the Trivia footnote gives the appearance it was MLB's idea to expand and that Bill Shea's whole drive was self-centered, i.e., to have a stadium named after him. This is patently incorrect. The National League had no intention of expanding and fought tooth and nail not to expand. This is why Bill and Branch Rickey created the concept of a third league - the Continental League - and this is why it took 7 years to the National League to expand back to NY. Bill's initial concern centered on the fact that NYC, with such a diverse population, needs as many unifying elements as possible within its society to help mitigate social and racial tensions. An additional concern was that the best city in the country was without a NL team. With respect to the naming, Bill wanted it to be named after the Mayor, however, the New York Times did a write in poll with five or so names on it, and Bill's name was unanimously selected. In response to that, and the work he did for the city for over the 7 or more years that it took to get done, the Mayor named it is his honor. In this same vein, when asked if he would accept a 25% interest in the team as a gift from Joan Payson, the original owner, he responded something to the effect of "I can't accept a monetary reward for something which I deem a civic duty."

" Thanks - F. Scott Shea"

Scott:  Many thanks for the informative and useful update; you flesh out the story of the genesis of Shea Stadium and the Mets beautifully.  And I apologize for mis-stating when Bill and Milton retired. 

Oddly, however, I was entirely aware when I wrote the piece that the last thing the National League wanted to do was grant NY a new team franchise—and I thought I was writing the piece from that perspective. Just goes to show that it's easier than one thinks to be misinterpreted.

In any event, Scott, I'm the one who owes thanks to you. 

Best regards, Bruce

"That Dapper Fellow"

Truth on the Market is also featuring "that dapper fellow," Adam Smith, as their favicon. But they use a different iteration than I do:

Bruce Profiled on JD Bliss

The JD Bliss site, which describes itself as "for attorneys seeking career satisfaction, work/life balance, and personal growth," just posted an interview with me. 

Fortunately, they decided to categorize me as a "success story" and a supposed inspiration rather than as a cautionary tale to be read to young children.before bed for their moral edification lest they stray. As they say, "you decide."

Seven Smart Guys

Two new blogs of note:

• David Maister's "Passion, People and Principles":  I sincerely hope you recognize David's name; if you don't, I implore you to take an immediate look.  His inaugural post is about his "blogging philosophy."  
• "Truth on the Market," a joint blog with two "founders" and four "authors," each smarter than the last, and all law professors (at different schools) with a severe penchant for economics.   Any commonality among them?  They seem to over-index on having gone to Chicago Law School, clerked for prominent federal appellate judges (Posner, anyone?), and done a tour at Latham & Watkins.

Henceforth, you'll be able to find them on the "Adam Smith, Esq." blogroll.

New York State Bar "Practice Management" Section Annual Meeting

I'm on the New York State Bar Association's "Committee on Law Practice Management" and, for the record, I wanted to invite all and sundry who might be in the New York area to our annual meeting Thursday, January 26, 2006, from 1:00—5:00 pm at the Marriott Marquis in Times Square (1535 Broadway @ 45th Street, 7th floor; and I expressly disclaim any responsibility for the selection of venue).

This year the program is titled:  "In Case of Emergency: Emergency Planning and Disaster Recovery for the Law Firm Everyone Needs a Plan," and will address that issue from the perspectives of human resources, finance, records, IT, and physical facilities.  More info here.

Blawg Review #39

"Adam Smith, Esq." is honored and delighted to host Blawg Review #39; I consider myself in excellent company given the distinguished and talented people who have hosted Blawg Review in the past.  

This week we celebrate:

Epiphany:  n.   1.  From the Greek epiphania "manifestation," often referring to the appearance of a divine being. Christ's appearance to Paul on the Damascus road was an epiphany. The word is used to describe the first appearance of Christ to the Gentiles in the visit of the Magi to the baby Jesus (Matthew 2:1-12), an event celebrated January 6.
2. Epiphany in fiction, when a character suddenly experiences a deep realization about himself or herself; a truth which is grasped in an ordinary rather than a melodramatic moment.

The most famous representation of "The Epiphany" in art history is doubtless Giotto's (more formally, Giotto di Bondone:  Italian, Florentine, 1266/76–1337) from New York's own Metropolitan Museum of Art:

My wife, who majored in art history at Vassar, has indelibly memorized this educational little ditty placing Giotto in art-historical context:

"Giotto, Giotto, Giotto-Giotto:  Renaissance
He paints in the morning and he paints at night;
If it's a Giotto it'll turn out right.
Giotto, Giotto, Giotto- Giotto:  Renaissance."   

Of course, here in New York City we celebrate the end of the 12 days of Christmas with our own tradition:  The annual rite of The Ceremony of the Mulching of the Christmas Trees, jointly supervised by the NYC Sanitation and Parks Departments:

Before we begin our cyberspatial tour, like all accomplished explorers, we need to be well-equipped.  To that end I commend to you Google Pack, a handy-dandy Swiss Army-knife compilation of everything the Prepared Scout of virtual-space needs, from Adobe Acrobat and Firefox to anti-virus and anti-spyware armor.

Let the tour begin!

Alito Fireworks

"Adam Smith, Esq." is resolutely non-partisan and apolitical.  That said, without question the best-quality daytime drama scheduled for this coming week will be the nomination hearings for Judge Samuel Alito to SCOTUS—they promise an extremely high entertainment-value quotient, and I for one intend to Tivo them in their entirety.  But for commentary and observation, I'll turn to those who plow these fields for a living, starting with the newest addition to the Law.Com "Inside Opinions:  Legal Blog Network," the consummately qualified Howard Bashman of How Appealing.

The "Epiphanic Moment" ("EM") from this post is Howard's intimate knowledge of the witnesses who will be testifying in favor of Alito this week: "I know about all of these judges as a result of having handled numerous appeals in front of the Third Circuit over nearly the past sixteen years and having clerked for a judge serving on the Third Circuit for two years before that. Here are my quick insights..."

Our friends at Law.Com have their comprehensive "A Field Guide to the Alito Confirmation Hearings."  You were expecting, perhaps, a red hawk pair nesting above Fifth Avenue?

Meanwhile, over at the Electronic Privacy Information Center, they've a remarkably comprehensive complete copy of a conference report from the Seeley G. Mudd Manuscript Library at Princeton University—the conference in question taking up "The Boundaries of Privacy in American Society," chaired by none other than then-Princeton-student Samuel Alito, who was responsible for putting the conference together, doing the research behind it, and preparring the "remarkable summary that accompanies the final report."   This should have the C-SPAN junkies going back to their Red Bull's for stamina.

NSA Surveillance Fireworks

Also on the late-breaking political newsfront, we have the story that our very own NSA ("No Such Agency") has developed an expertise in data-mining that Wal-Mart would envy, but rather than applying it to how our household purchases index on Crest and Pampers, they've applied it to determine how many degrees of separation lie between you and Osama.

Jay Leno has his own take on this revelation:

According to a new poll, President Bush's approval ratings are on the rise. A lot of these polls are phone polls and people were worried Bush is listening in.

Kierkegaard Lives, a new blog to me, provides a "wire-tapping link repository" aiming to constitute one-stop-shopping for digerati running down primary sources on this. 

For the attention-span challenged, yesterday TalkLeft uncovered a Congressional Research Service report questioning the NSA/White House's authority.  EM from the summary:

"The 44-page report said that Bush probably cannot claim the broad presidential powers he has relied upon as authority to order the secret monitoring of calls made by U.S. citizens since the fall of 2001."

For the record, I do not subscribe to the cynical view of this imbroglio that it's merely a matter of whose ox is being gored—that if you're an upstanding American citizen you have nothing to fear from the snoops, so what's your problem, buddy? Rather, I view the debate as the latest incarnation of the timeless, "no permanent solution" tension between human liberty and free and open societies, and the reality that "the Constitution is not a suicide pact."

Lawyers Behaving Badly

This topic can only be introduced by:  "Where oh where to begin?!"

f/k/a reports on a lawyer who:

"... gets three months in jail for being one of the two major actors in a complicated scheme to steal millions of dollars [$25.6-million, in fact] from people he himself describes as "decent, hardworking people looking for an honest way to resolve their debt issues.""

"Attorney Lisa B. Shelkrot came up with the usual defense gobbly- gook, including: "What stands out [in letters from prominent members of the community] is his selflessness and commitment to service." "It was a fear of destitution, not a high flying lifestyle ... that lead him to this.  Sinnott had a "deeply and tragically" flawed personality."

My EM question to Ms. Shelkrot:  Are you yourself buying that for a second?

More seriously, Jack Balkin asks whether it now "seemed as if there was no legal proposition, no matter how outlandish, that you couldn't get some prominent lawyer these days to defend."  Answering his own question, he writes:

"Lawyers have always, to my knowledge, been willing to come up with clever and ingenious arguments for the interests they represent."

"Put another way, we have all known for many years that lawyers are rhetorical whores; their job is to confuse, obfuscate, and make unjust and illegal things seem perfectly just and legal, or, if they cannot quite manage that feat, to muddy up our convictions sufficiently that we conclude that it's a close case. There is nothing new about this."

"Lest I be misunderstood, I do not mean to say that law and legal doctrine counts for nothing, and that lawyers have no independent role to play other than as political cheerleaders for one side or the other. Rather I mean to say that the law always needs help from other sources in political culture if it is to do its job appropriately. The rule of law, I would insist, is not a purely legal or professional ideal-- it is a political ideal."

TalkLeft decodes what motivates outstanding federal prosecutors to go to the defense side—and questions whether they ever really make the transition.  "The real problem is most of these former high-level prosecutors can't make the mental shift. They don't have it in them."   Or, as former Deputy Attorney General James Comey puts it in a quote so rich you couldn't make it up (EM in bold):

“You go from being paid to do the right thing every day, from having the freedom never to make an argument you don’t believe in, to being a defense attorney, where you are duty-bound to make the best argument you can,” he told the New York Law Journal. “I have a tremendous respect for people who do defense work, and it’s not lying, but in a private moment, sometimes, you say, ‘Geez, this is a bunch of baloney.’”

And you really  anticipate even a soupcon of "zealous representation" on behalf of a criminal defendant from Mr. Comey?   TalkLeft certainly doesn't:  "Pathetic...irksome beyond description."

For a moment's worth of comic relief, the always-reliable Walter Olson at Overlawyered chronicles a Dallas restaurateur who sued the Dallas Morning News over a review of his restaurant, "Il Mulino"—specifically, so it would appear, over the newspaper critic's take on Il Mulino's bolognese and vodka sauce.  I am pleased to be able to report that the matter has been settled without admission of much of anything, it seems, but with a promise of a second review from the newspaper.  "And you're ugly," perhaps?

The serious message here is simply, Who comes off looking worse?  The benighted restaurateur who exponentially increased circulation of the critical review by his action, or the lawyer who took good money from him to help?

Craig Williams, another Scottish lawyer with a penchant for economics, regales us at May It Please the Court with Major League Baseball's claim that it "owns" all baseball statistics.  The party offending MLB's expansive notion of the territorial reach of its intellectual property is one CBC Distribution & Marketing, a fantasy baseball game operator—dependent for the reality of its fantasy upon real-world baseball statistics.  EM of the post:  "Next thing you know, they'll be charging the fans to quote statistics to one another."

Mauled Again kicks off 2006 with a confident prediction:

"The culture of corruption, of bribery, of putting one's own selfish interests above those of the public one is required to serve will also trigger yet another easy-to-predict Top Ten tax story of 2006. At least one politician, one celebrity, and one lawyer will run afoul of the tax law by failing to file a tax return or by failing to pay income taxes."

What's to be done?   You might try starting young:

"It is a challenge getting across to law students the point that when they enter the profession, and even as law students, they are subject to a higher set of integrity standards than those that apply generally to citizens of the nation."

Put that on your refrigerator.

On a less consequential, but equally depressing, note, Matt Homann of "the [non]billable hour" reports seeing a serious-minded piece of advice that clients should not talk to their lawyers until the deal they're doing is completely worked out.   What on earth would prompt such advice?  "Our predominant business model"—the billable hour.

In contradistinction to the billable hour, Greatest American Lawyer advocates serious, candid discussions with clients about budgets.  The goal?  Try, "Truth."   

Over at Houston's Clear Thinkers, Tom Kirkendall writes about "The High Price of Asserting Innocence," and sees a vicious double standard infecting the Enron prosecution, wherein the right to defend oneself has essentially been emasculated by trigger-happy prosecutors and the federal sentencing guidelines' emphasis on co-operation as a get-out-of-jail-free card: 

"Last week, former Enron chief accountant Richard Causey pled guilty to a single count of securities fraud and agreed to a seven-year prison term after vigorously defending himself from multiple charges of business crimes for over two years. Had he elected to defend himself at trial against the charges and lost, he would have faced an effective life sentence."

Yet another triumph of the Law of Unintended Consequences; but lawyers created this injustice. Can't lawyers be expected to fix it?

Part of the problem may be that lawyers can't be expected to fix injustices if they simply can't be trusted in the first place.  To that point, Dennis Kennedy recounts the "baffling" decision of the Florida Bar's Board of Governors to prohibit lawyers from looking at metadata—presumably on the principle that gentlemen don't read other gentlemen's mail.  To my mind, the only conceivable rationale for such (a feckless) rule of "Enforced Ignorance" is that the children can't be trusted near the liquor cabinet.

Is there hope?  Point of Law writes about "Merit-Based Judging" and urges all of us (is the MSM listening, here?) to get the notion out of our heads that judicial decision-making is a clone of the legislative process, where all that matters are results.  Ted Frank comes out decisively in favor of hoping Alito will truly judge matters strictly on the merits, and even though Frank is confessedly pro-business, he argues correctly that "business is better off in the long run with a judge and judiciary that decides cases on the merits"  rather than "a hack judge who makes his or her decisions based on the identity of the parties in the caption." 

Wouldn't it be nice if a greater proportion of the American public (and again, the American media) understood that "decisions based on the identity of the parties" enjoys a one-for-one identity with being "a hack."

Finally, we can all breathe a sigh of relief—inbetween chuckles, anyway—at the extremely welcome news that The Bitch is Back. 

Practice, Practice, Practice

Lest you begin to form the impression that lawyers never get any real work done, we have an eclectic roundup of practitioners opining on their specialties.  I'm not sure any one of this exactly qualifies for an "EM," being, as they are, proudly technical and rational self-contained essays, you hey, you might learn something; I surely did.

• Ever wonder about the extraterritorial application of US Antitrust Laws?  You understand, of course, that ever since Alcoa (1945), it's been settled that they do have some such reach.  Law & Society sets us straight (and I'm personally a sucker for their banner image).
• Patent Baristas educates us on the USPTO's proposal to limit continuations, which have "become the current whipping boy."  (Who knew?!)  PB opines that "this has not been thought through very well," and as part of their argument to that effect notes (and trust me, I quote):

  "Note that proposed Rule § 1.78(f)(2) provides that for applications that fall under set proposed § 1.78(f)(1) above, there will be a rebuttable presumption that the nonprovisional application contains at least one claim that is not patentably distinct from at least one of the claims in the one or more other pending or patented nonprovisional applications. In that case, [etc.]"

  I'm willing to take them at their word.
• Staying in IP-land for a moment, The Invent Blog notes that David Allen's "Getting Things Done" (a collection of techniques I heartily endorse), which relies upon tabbed folders for organization, wouldn't be possible without the handiwork of one James Newton Gunn, who in 1897 obtained a patent for tabbed folders and index cards.  Respect your ancestors, I always say!
• My e-friend Ingo Forstenlechner has just completed his Ph.D. thesis titled "Impact of Knowledge Management on Law Firm Performance - An Investigation of Causality across Cultures" and wants to let you know that you can get a copy directly from him.  I'm sure Joy London already has hers.  Here's an excerpt from Ingo's abstract of the thesis: 

  "The set of cause and effect relationships at the heart of the [balanced] scorecard - referred to as the success map – is at the core of this research, which aims to investigate if the link between managing knowledge and financial performance really exists and – if it does – how it can be influenced." [And his conclusion?] [...]  "This thesis provides the empirical evidence for a link between KM and organisational performance."

• Carolyn Elefant at My Shingle offers very practical advice (##'d 1 through 5, in fact) for people seeking contract work from local attorneys or solos.
• And last, both Carolyn and I contributed to the launch of Law.com's "Career Center" earlier last week.

And The Final Word Goes to The Economics of Law Firms

I hope you all saw that coming.

Patrick Lamb, at  In Search of Perfect Client Service, essays upon "The Essence of Leadership."  The first thing he does, with a hat tip to Tom Peters, is distinguish leadership from management:  "Management has a lot to do with answers.  Leadership is a function of questions. And the first question for a leader always is "what do we intend to be?""

Those of you who were comparative lit majors may be interested to know that I took off from the same Harvard Business School paper Patrick is launching from, in a post of my own, here.

The anonymous Wired GC kicks off the New Year by turning his thoughts to New Ventures, and to the pilot fish that invariably accompany them in schools, your friends the Venture Capitalists, and The Top 10 Lies of VC's as recounted by Guy Kawasaki, who's in a position to know.  My personal favorite is #9 (EM included) :

"Do you know why we all know about Google's amazing return on investment? The same reason we all know about Michael Jordan: Googles and Michael Jordans hardly ever happen. If they were common, no one would write about them. If you scratch beneath the surface, venture capitalists want to invest in proven teams (eg., the founders of Cisco) with proven technology (eg., the basis of a Nobel Prize) in a proven market (eg., ecommerce). We are remarkably risk averse considering it's not even our money."

Gerry Riskin at Amazing Firms, Amazing Practices (who I know well, whom I hope to have breakfast with in New York this coming week, and who deprived the world of stand-up comedy of a potential ace when he stuck to law-land) turns the kleig lights on "old-fashioned bad management" at Dorsey & Whitney's London office, leading the en masse departure of 8 associates. What, Gerry asks rhetorically, does it cost to recruit 8 associates? And what firm would "dare subtract that number from the billing revenue of some maniac in order to determine compensation?" Another rhetorical question.   But the EM is this:  Thanks at least in fair measure to the blogosphere, dysfunctional people cannot remain anonymous.

Finally, the question you've all had in the backs of your minds, especially those of you contemplating hosting another Blawg Review of your own some day: Am I glad I did it?

Yes, I thoroughly enjoyed it!  I had the chance to delve deeper into some old friends, to meet some new ones (as it were), and finally, to point you all towards two of my own post-children of the past week:

• Five Questions (Or Is It Only One?) For Your Firm in 2006, and
• Build on Your Strengths or Tackle Your Weaknesses?

It's good to be King For A Day.  Still, I hope I've done justice to Blawg Review #38's 10 Resolutions for Better Blogging.

And to all a good night, and a most merry and enjoyable 12 Days of Christmas next year.

Blawg Review has information about next week's host, and instructions how to get your blawg posts reviewed in upcoming issues.   Final Note: I'm also interviewed there.

"Blawg Review #39" Coming Soon

"Blawg Review #39" will be hosted right here at "Adam Smith, Esq." this coming Monday, January 9th.   If you're not familiar with the concept, Blawg Review is the legal blogosphere's iteration of what's becoming a happy, entertaining, and valuable custom among the digerati:  Creating a weekly digest of some of the "best of" posts of that week in whatever specific topical area is in question.

Many of the weekly topical digests are called "Carnival of the [insert topic here]" for reasons now lost in the mists of internets past.  One of my favorites, which will surprise no one, is "Carnival of the Capitalists."

So I'm asking for reader participation. 

• Legal bloggers:  Send me a link to what you consider one of your smartest, sassiest posts of this week.
• Loyal readers:  Send me a link to posts from your travels in the legal blogosphere that you either think I ought to see, wish you had written, or both.

And thanks in advance to one and all for checking out Blawg Review #39 this coming Monday.

Law.com Launches "Career Center" With a Familiar Face

In case you haven't seen the home-page of Law.com today, they are launching their "Career Center":

And this is the article that I'm up there, as it were, alluding to.

"The Wall Street Journal Online, Esq."

As of this morning, there's a noteworthy new kid on the legal blogosphere block: "The Wall Street Journal Online, Esq."

Well, not quite—actually, they're calling it simply their "Law Page," but a "centerpiece" of their new coverage is their new Law Blog.  Grab the feed.

Who's behind this?:

"We've beefed up our legal team with two great journalists: Ashby Jones, our legal editor, was a reporter at The Deal and American Lawyer Media. A former litigator and clerk to a federal judge, Ashby is a graduate of Haverford College and the University of Michigan Law School. He'll be writing The FLaw column.

"Peter Lattman will be writing our law blog. Peter joined the Online Journal from Forbes Magazine. Before becoming a journalist, he was a litigator at a law firm and worked on Wall Street. He is a graduate of Harvard University and Fordham University Law School. The blog will also include contributions from reporters at The Wall Street Journal and Dow Jones Newswires."

A heartfelt "Welcome" to the blawgosphere is in order!   And you thought blogging was going to turn out to be a fad....

So You've Made Your New Year's Resolutions....

What are your New Year's resolutions?  And, of greater interest, what makes you think you might really observe them?

Let's take a step back:  Isn't there something fundamentally irrational about New Year's resolutions to begin with?  After all, if you want to start running five miles a day, getting to work earlier, or cutting out the cheesecake, you shouldn't wait until January 1st to start.

Prof. Thomas Schelling, this year's Nobel prize-winner in economics for his work on conflict, has something to tell us about this:  He's written at some length about the archetypal situation in which a "resolution" may come in handy to change your actual behavior.  He posits a divided self:  One part of us wants to stop smoking, the other part wants to reach for the cigarette after dinner.  One part of us wants to get up earlier, the other part wants to hit the snooze button.  So far, so familiar.

The insight he adds is that these two parts of ourselves exist at different times.  The Angel Part is in control before the decision is actually made; the Devil Part takes over at the moment of truth.  So the question becomes:  Are there tools/techniques/strategies we can employ to strengthen the Angel's ability to constrain the Devil when push comes to shove?  There are some.

• The very fact that you have made A Formal (Written, I hope) Resolution raises the price of non-compliance; if you've also made the commitment public with a spouse or loved one, posted it on the refrigerator and above your desk, so much the better.  Shame doesn't always trump temptation, but you can give it a fighting chance.
• Make bright-line rules, not vague incantations of improvement.  So:  Rather than "eat less," specify "zero carbs."  Rather than "only one cigarette after a meal" (what exactly is a "meal" in today's grazing/snacking society?), "one cigarette only at 1pm and 7pm."
• Physically remove temptation:  If you have to go out to buy dessert, the Angel may have time to reassert control, but had it been ready to hand in the freezer, the Devil starts out on top.
• Bargain with yourself and promise a reward for the pain inflicted by compliance with the Resolution:  If you lose 10 pounds, you can buy a new dress.  Just make sure the incentive is something you really want; make it meaningful, so that its loss would be painful.

So what are my New Year's Resolutions? 

• To connect with more readers of "Adam Smith, Esq." in the real, off-line world—one of the greatest rewards of this site, to me.
• To try to make "Adam Smith, Esq." ever more insightful, carefully reasoned, and just plain intrinsically interesting.  And
• To celebrate everyone's entitlement to one vice of their choosing.

Merry Christmas

Venus

Limits to Capitalism: The New York City Subways and When Public Benefits Private

Aside from law firms and the business thereof—my genuine professional passion—I must occasionally share a personal passion, but only if it touches upon economics.  One personal passion is the almost unimaginable centrality of the subway system to New York City as it exists today.

Today's threatened subway strike in New York (which was averted by "stopping the clock" for four more days, at which point we'll be on the brink again barring a settlement), is such an occasion for breaking the rules about what you come to "Adam Smith, Esq." expecting.

What on earth do the subways have to do with economics and business?  Plenty.

If you look at a map of downtown New York in 1900, before the subways were built, there were no skyscrapers.  Look at the same map 10 years later (the first, primary, branch of the IRT opened in 1903, from City Hall to Harlem), and you will see a virtual curtain wall of skyscrapers down Wall Street and Broadway.  Did engineering technology change?  No—what changed was the ability of the subways—the physical infrastructure of the city—to deliver the throngs of office workers from Brooklyn, Queens, and the Bronx needed to make those skyscrapers economically viable.  

The same is no less true today. 

New York could not live without it.

Courtesy of the WSJ:

FAST MTA FACTS

BlawgWorld 2006 (The Non-Virtual Dimension)

Despite the fact that there's been a minor dust-up in the blogosphere over "BlawgWorld 2006," I thoroughly enjoyed myself at Brandy Library in Tribeca and again thank Neil Squillante, his ace assistant Sara Skiff, and TechnoLawyer in general for dreaming up and bringing to life what I consider an enlightened and creative way to expose non-blog readers to the legal blog community. 

We Were Experiencing Technical Difficulties

My humblest and most sincere apologies, but for about the past 24 hours "Adam Smith, Esq." was, alternately, not rendering correctly in Mozilla Firefox or Internet Explorer.

The issue, for the geeks in the audience, had to do with how those browsers differently interpret CSS (cascading style sheets, which I rely upon to format the site). A sympathetic reader put it best:

I know what it is and that it's complicated, that's about it.

And IMHO the move to the new three-column layout has been worth the pain.

New Three-Column Layout

As you've doubtless noticed (unless you're an RSS subsriber), we're rearranging the site's layout, by splitting into three columns vs. the original two.

The goal is to put more material "above the fold" (i.e., above the scroll-down part of the screen).

Conceptually, the new left-hand column contains information about "Adam Smith, Esq." itself, including all the archival links.  The right-hand column is "other stuff," such as ads, the blogroll, etc.  And of course the middle column is the heart and soul of "Adam Smith, Esq."

At the moment, the  site width is fixed at 900 px, so if  your browser window is narrower than that you'll have to scroll horizontally--big bummer, but we're working on it.

Our goal is to make the site expandable so that it will fill to fit your browser window.

Announcing "BlawgWorld 2006: Capital of Ideas"

With pride I would like to announce the release this morning of "BlawgWorld 2006," the first in what is promised to be an annual series of "e-books" comprising the best of the blawgosphere, brought to you by our friends at TechnoLawyer.  In their own words:

"According to various studies, approximately 80,000 new blogs launch every day, including dozens of legal blogs (blawgs). No one knows how many blawgs exist, but whatever the number, monitoring them would amount to a full-time job.

"For this reason, we've published BlawgWorld 2006: Capital of Big Ideas, a TechnoLawyer eBook designed to take you on a journey through 51 of the most influential blawgs.

"You cannot buy a copy of BlawgWorld 2006. It's free, but available exclusively to TechnoLawyer members. To receive your free copy, please use the form on this page."

The inaugural issue contains "best of" posts from 51 separate blawgs, and I am honored that the "sampler" from "Adam Smith, Esq." was chosen as the illustrative post featured on the BlawgWorld 2006 home page.

I encourage you all to take a look; clearly a lot of hard work has gone into this endeavor.  And in the true original spirit of the 'Net, it is, I repeat, completely free.

Unfortunately, I cannot offer all of you the free drinks I and other contributors will be enjoying tonight courtesy of TechnoLawyer to celebrate the launch of BlawgWorld 2006.  But if you're ever looking for a snappy bar in Tribeca, check out "Brandy Library," where we'll be congregating tonight.

A Little Humor Never Hurts

And I quote from today's "BlawgReview #34" hosted by Douglas Sorocco of PHOSITA fame ("phosita" stands for "persons having ordinary skill in the art," which in turn is part of the standard for granting or denying a patent—the subject invention must be "nonobvious" to the hypothetical PHOSITA):

"I really feel bad about putting the Adam Smith, Esq. blog in the ‘terrorism-like’ section, but since I am a small firm kinda guy, anything that has to do with the AmLaw 100 and especially about the fact that “two tier” partnership firms have lower profits per partner is automatically a “terrorism-like” subject. Sorry, Bruce!"

Hey, Doug, it's OK:  I consider this a distinguished first for "Adam Smith, Esq."

And it contains a seed of wisdom:   For all the rigor, seriousness, and energy with which I pursue analyzing the strategy and behavior of "BigLaw," it never hurts to be reminded to bring your sense of humor to the table.

Happy Thanksgiving

...From the Upper West Side.  (The night-before balloon-inflating beats the parade itself, for our money.)

Announcing The First Ever "Adam Smith, Esq." Podcast

Bloomberg Radio interviewed me live early yesterday afternoon in connection with the release of the 2005 National Law Journal 250 rankings—and specifically about the reasons behind the 4.4% jump in headcount (the largest year over year increase since 2001).

The interview is brief (less than four minutes), but for all of you whom I've never met, you get to hear me, as it were, in person.

Are Your Lawyers Blogging Yet?

Does your firm permit or prohibit lawyers and staff to blog?

IBM's unofficial "blogger in chief," Christopher Barger, condenses the benefits of blogging as follows:

“This is a way to get our expertise out there, not by shoving it down people’s throats, but by just starting conversations.”

“The broadcast model of a centralized voice saying this is our one voice out to the world isn’t realistic anymore.”

Isn't the risk that people will "leave the reservation," becoming totally unbuttoned and unglued?  Well, do they act that way in the office, at their desks or in meetings?  Why should you assume a personality transplant comes with a keyboard and a blog platform on-screen?  (My wife reliably reports she sees no such effect with yours truly.)

Better yet, give employees guidelines:  IBM's were developed collaboratively, using an internal wiki, in all of ten days.   Arcane they are not:

• Try to add value; correct your mistakes; don't pick fights.
• Respect copyright.
• Identify yourself truthfully.
• Take responsibility for what you say.
• Don't reveal trade secrets or mention customers without their permission.
• &c.

None of this should come as a surprise.  Lawyers are nothing if not information junkies (near the top of all professions in their use of Google); given that, how much longer does it make sense for your firm to attempt to bottle up the conversation? 

Be bold; share your expertise; have the nerve to start a conversation.

London in Five Days

More on my London journey: 

The raison d'être of the trip, as mentioned, was to meet the other partners of Edge International:  That meeting was this past Saturday and Sunday at the Naval & Military Club hard on St. James' Square in London.  Virtually everyone made a presentation, including me, and at least insofar as the others go, I can say at an unsurpassed level of intellectual and professional stimulation. 

The scope and depth of the presentations was far too varied to summarize, so let me tantalize.  One presentation focused on the cross-cultural differences among countries, always something germane for global law firms, and awareness of which is too often honored in the breach.  Here's a hypothetical question:

"Which way of perceiving a company would you regard as the most “normal”:

"A.  A company is a system designed to perform functions and tasks in an efficient way. People are hired to perform these functions, sometimes with the use of machinery or other equipment. They are paid for the tasks that they perform.

"B.  A firm is a group of people working together. They have social relations with other people in the organization. The functioning of the organization is dependent on these relations."

Consider your answer.  Ready? 

I have the advantage of having seen the chart first-hand, so here's how to decode it:  In the US and UK (the two bottom bars), 90% of people think the "normal" view of a company (note the question is "normal" not "desirable" or "ideal") is as a system to perform functions.  But in China, Japan, and India (bars 2 through 4), roughly 80% think the normal view is as people dependent upon social relations working together.  Next time you're tempted to ignore cultural differences and barge ahead assuming they'll all come out in the wash, think again.

Sincere and public thanks to all the Edge-ites who were so welcoming.

Friday morning, thanks to an introduction from Bruce Marcus, I met Nadia Cristina, managing editor of professional marketing, "the worldwide journal for marketing professional services."  We talked largely about blogs in the context of professional service firm marketing, and I learned that blog adoption in the UK is like text-messaging adoption here:  Almost nowhere.   Americans blog; Brits text-SMS—but not the reverse.  The venue was near the Bank tube stop in The City, near the "gherkin" (a/k/a the Swiss Re headquarters, designed by Sir Norman Foster).

Finally, Monday afternoon into early evening I spent nearly two of the most professionally luxurious hours I've enjoyed recently with Tony Williams, founder of the Jomati consultancy in London, and former global managing partner of Clifford Chance and, subsequently, the late Andersen Legal, where he earned the UK's Partner of the Year award in 2001 for personally seeing to it that virtually 100% of the lawyers and staff were successfully relocated to new positions elsewhere in The City after the Enron implosion brought this early experiment in MultiDisciplinary Practices to a screeching halt through no fault of its own. 

Does Tony share the view that running a law firm like a business is an unprofessional approach?  "Arrant Nonsense!  Arrant Nonsense!"  Glad I asked.

If You Come to London, Bring Your Own WiFi

Dateline London (Has a nice ring to it, no?)

My apologies to all for the blogging drought, but I will try to make up for it with a full report on my affairs in London when I return to NYC. (I arrive late-ish evening NYC time tomorrow/Tuesday, so Wednesday with any luck.)

For now, I can report with delight that the trip has exceeded my expectations on all fronts: On the business front, I have gotten tremendous enjoyment--and intellectual and professional stimulation--from my new best friends at Edge International. (Prior to this trip, the only one I could credibly claim to know reasonably well was Gerry Riskin, whose decision to pursue a career as a legal consultant deprived the world of an otherwise truly gifted stand-up comic.

An unexpected bonus was making the acquaintance of the remarkable Alan Hodgart, a McKinsey alum (and not a lawyer) who is to strategy consulting for law firms as Thomas Edison was to inventing--they don't get much better.

On the personal side, the couple of extra days I squeezed in mean that I'm now fully comfortable thinking of London as a second home, and there's tremendous emotional, cultural, and aesthetic reward in being able to notch another world-class City into one's mental image-map.

Until later, thanks for your forbearance.

London Calling

Reminder:  I'm off to London this afternoon for a week (back in the States Wed 26 Oct). 

The main business purpose is to meet all the good people at Edge International that I have not yet had the fortune to get to know in person.

As a bonus, I'm going to meet the famous Tony Williams of Jomati.  Tony, an underachiever, was merely managing partner of Clifford Chance during the period it merged with Rogers & Wells in New York and Punder in Germany, following which he became worldwide managing partner of Andersen Legal.   Earlier this year, I had this to say about Jomati.

Blogging while across the pond?  No promises, alas.  While, as always, I will try my best to be diligent, I will be at the mercy of the gods of WiFi hotspots, who can be miserly or generous.

Don't Forget to Vote

Remember to exercise your franchise and vote in this week's reader poll, about the future of the billable hour (scroll down the right-hand column a little ways).

And if you're reading this via RSS or otherwise aren't on the site's home page, you'll need to go there. The poll comes down on Wednesday.

Thanks!

Introducing the Weekly "Adam Smith, Esq." Reader Poll

Introducing a new feature here on "Adam Smith, Esq.:"  Our Weekly Poll.  Just scroll down the right-hand column a little ways and you'll find it.

With luck, I'll come up with something thoughtful, intriguing, or just plain whimsical to ask you, dear readers, every week.

The kickoff question asks your views on the future of the billable hour.

Rules of the Poll Road:

• Only one vote per visitor per week, please (a/k/a no ballot-box-stuffing).  Allegedly the software I'm using enforces this, but the honor system is always a good first resort.
• I reserve the right to have poll-free weeks—as I hope you've come to expect here on "Adam Smith, Esq.," we insist on quality over quantity and if I can't come up with something worthwhile I won't come up with a mere placeholder.
• Reader suggestions are very welcome!
• I anticipate doing a quick recap of the results each week, and reserve the right to speculate on whether they actually might mean something.

And of course for those of you reading this through RSS or as a direct link to this post alone, remember you have to actually go to the site to find the poll.

Enjoy.

Jury Duty Down; London Up

Well, that was quick; I'm back from jury duty.  Actually, not "back," rather "deferred" (until some time in January).

The issue, about which they give you eminently fair and civilized warning, is that there's an outside chance one could end up on a trial lasting as long as two weeks (beyond two weeks, I infer although they did not say, is a "special circumstance" which judges will deal with individually outside the normal parameters of jury duty).  Since I'm going to London for 5 days a week from tomorrow, that ruled out my ability to promise I could serve.

London?, you ask:  Indeed.  My good friends at Edge International are convening for an all-hands meeting on the 21st and 22nd, and they have graciously invited me.  I will be doing a presentation about the use of blogs, wikis, and RSS in professional service firms.  The estimable Gerry Riskin, of course, already has one. 

Extracurricular events may include a concert at the Royal Albert Hall, and will certainly include The British Museum, The Tate, and extravagantly long walks in one of the world's greatest pedestrian cities.   Stay tuned for photos.

Jury Duty Starting Tomorrow

Jury duty starts tomorrow for me.  (Lawyers used to be exempt in New York State, but lovely as that was while it lasted I cannot quarrel with the decision to put us back in the pool, as it were.)

Needless to say, I have absolutely no clue how long I will be serving, but suffice to say don't expect frequent, or perhaps any, postings until I come up for air.  No, no WiFi in court, alas.

Wish me luck.

"Good Lawyers Write Well, Quickly, and Clearly..."

Obligatory, I suppose:

• While lawyers are less than 1% of the population, we evidently make up 5—6% of blog writers and readers, putting us behind computer professionals and students.
• "It's all words, that's all the law is."—Scott Turow.  And, my favorite:
• "Blogs break down the barriers."—Denise.

Once something is in The New York Times, with its own patented reality distortion field, that something is True.

Heading to San Francisco for Four Days

I'm heading to San Francisco this afternoon for four days (back Wednesday night on the red-eye):  Mostly business, but a bit of pleasure as well in my second-favorite City, and I'll be staying with friends in the East Bay. 

If the business part goes as hoped and planned, you'll be reading about it here in the near future (and if not, kindly forget I mentioned it).

Blogging will be sporadic if extant at all, and largely dependent on the whims of the WiFi connectivity gods.

On the Internet, Nobody Knows You're a Dog

For the Community, From the Community

"This one's for you," dear reader:

Courtesy of my site-stats server, you can see that "Adam Smith, Esq." enjoyed over 90,000 visitors during the month of July and at this rate should be easily over 100,000 visitors/month by Labor Day.

I am humbled and deeply appreciative of the implicit endorsement this constitutes.  But that doesn't mean you shouldn't still tell all your friends and colleagues if you continue to like what you see here!  

Many thanks.

Google Ads: An Experiment

I'm experimenting (as you can see!) with Google AdSense.

While I have every hope that the ads will be tasteful and germane, I don't know that I can guarantee it. Here's what Google has to say about it:

Google combines advanced technology with editorial staff to ensure the highest quality standards in our ad program, but we recognize that you may not want certain ads.

Feedback is always welcome! Please email me personally with any reactions.

Gerry Riskin

The Fight Over Sandra Day's Replacement

Will not be covered in these pages.

In case you were worried.

Happy 4th of July

Belated Happy 4th of July to one and all.   Around here we tried to keep the celebration very traditional and low-key:  Took in a Mets game at Shea (the Yankees were in Detroit losing to the Tigers), had Central Park virtually to ourselves, and made sure Venus was flying the colors.

Get An Early Preview of the AmLaw 100 Right Here

Sign up for an email update, subscribe by RSS, or just come back here Tuesday evening. I for one will be all eyes.

"Adam Smith, Esq." Finalist Among Practice Management Blogs

Congratulations are in order to Jim Calloway for winning the "Favorite Practice Management" blog award over at TechnoLawyer (complete list of winners and finalists).  

I'm also pleased to report that "Adam Smith, Esq." and Dennis Kennedy were chosen as finalists. 

There's always next year....

"Managing Partner Magazine" Anybody Know This Pub?

"Managing Partner Magazine?"  Calling all readers who may be familiar with this publication, which I have seen occasionally but perhaps not often enough, or not enough of—primarily because their website appears to hide all the good stuff. 

But past the spam filter arrived this afternoon a promotion to subscribe (reproduced verbatim in the extended portion of this post).  Any advice from any of you who know the publication?  Worth it?  Too pricey?  On a scale of 1 to 10, it's a [_____]?  As always, bruce at adamsmithesq dot com is happy to hear from you.

Results of the Readership Survey

The long-awaited results (speaking for myself, at least) of the famous first-ever "Adam Smith, Esq." Reader Survey are now in, and I hasten to share them with you, dear reader, as audience participation was extremely strong, and gratifying.   My version of Excel had steam coming out of its ears over the long weekend, but the results have now been thoroughly sliced, diced, and charted, if not yet pivot-tabled.  

Are the results reliable or accurate?  My crack panel of market research experts (that would be Janet) advises that, if the question is whether the responses are likely to constitute a representative cross-section of the actual readership of "Adam Smith, Esq.," the answer in all likelihood is yes—it should be accurate. 

Why?  First, the absolute number of responses was gratifyingly high.  My stats server reports that lately the site has been enjoying about 50,000 visitors per month (this means hundreds and hundreds of thousands of "hits," a different measure),  and while the survey scarcely got that many "visitors" (for one thing, you can visit here more than once a day but the survey locks you out, other than to make changes, once you've responded), it got a more-than-decent response.   Second, it was up for a month and thus exposed to a random cross-section of visitors.  Finally, and most importantly from a "research design" perspective, there is no plausible reason to think those willing to respond have a different profile than those who didn't.

So, without further ado:

Question #1:  Who You Are

I'm pleased at the high proportion of people living and working in law firms, as it is to the enhancement and enlightenment of their world that this site is, when all is said and done, devoted.   And among "other," what roles were specified?

• precisely 25% of all "other" are legal industry consultants;
• we have a more than respectable smattering of CIO's, heads of knowledge management, headhunters, judges, and law professors (not so many law students, evidently—perhaps the issues we cover seem remote to them?);
• along with the self-deprecating sprinkling of "interested reader--not a lawyer," "just interested," and "just a private (so-called) citizen," and finally my very favorite;
• "ESQ Wife."  (Please do not be desperate, ma'am.)

Question #2:  Where You Are

So about 77% are here in the USA and, according to my site-stats server, if you can believe IP addresses you're concentrated in the Northeast and California.  With respect to those in "Asia" who were asked to specify where they are, the top answers were:

• India
• Korea
• Phillipines, and again my very very favorite (maybe even better than "ESQ Wife"):
• Kyrgyzstan (!)

Question #3:  If You're in a Law Firm, It Is

Again, I'm gratified to see that what I view a my day to day core target audience—the AmLaw 200 and firms of similar size abroad—is well represented.  And lest those of you in regional or single-office firms, or even solo's, feel left out, please be assured that I try to cover issues such as leadership, strategy, and cultural considerations that cut across all sizes and shapes of firm.  What about "Not in the US?":

• About 20% of this segment is each in the UK [top 20 UK firms well represented], Canada, Australia/New Zealand, and India.
• The remainder are simply far-flung including Chile and the broadband-friendly Finland and Norway.

Question #4:  How Do You Read "Adam Smith, Esq."?

So I credit you for candor--"purely by chance," while trailing all other choices, makes a non-trivial showing.  I don't know why, but my intuition going in would have guessed RSS feed penetration would be higher.  The good news here is you seem by and large to be loyal.   Thank you!  Sincerely.

Question #5:  What You Wish I Would Write More About

No pie charts on this open-ended question, which 31.7% of you actually took the time to respond to.  Some of the highlights/themes that emerged from this "visitor request" opportunity, in no particular order other than that all were mentioned more than a few times:

• technology, especially as it impacts the economics of the practice of law; and [the lack of] technology training
• the differences between US and UK/European firms
• leadership and cultural issues, including lateral recruitment and entry-level associate hiring, development, and retention
• flaws of the billable hour system and alternative billing in general
• knowledge management--"what else!"
• along with a truly gratifying number along the lines of "n/a, doing good," "keep it varied," carry on--you're doing fine," "is just right," and the blushworthy "anything you want - you have great insights."

But I would be remiss not to leave you with our champion in this category, which wins going away:

• "tax law and how to smuggle money out of the country."

Question #6:  What You Wish I Would Write Less About

30.4% of you responded here, and of those responses 40% were to the effect of "nothing," including a generous reader who volunteered "I cannot think of a thing you shouldn't write about ;-)"

Of the 60% who had a recommendation, many duplicated issues that (I hope!) others had cited under #5, including technology, KM, alternative billing, and leadership issues.  Much as I try to be responsive, dear readers, this presents a difficulty; I think I shall probably continue to try to keep the content varied, although I will take your collective counsel reflected under #5 to heart.

Do we have a winner in this category?  Indeed we do—a reader who, having seen "Adam Smith, Esq." branded in the banner as "...an inquiry into the economics of law firms," requests that I spend less time on:

• "law firm economics."

Question #7:  The Most Pressing/Frustrating Legal Business Issue Facing You/Your Firm

44.6% of you responded to this, indicating perhaps a distressing degree of pain.  Interestingly, the single most oft-cited problem issue can be reduced to one word:  Management.   Although it was expressed in different ways from various perspectives, some of the representative comments here included:  "work overload [because of] lack of efficient management;" "total hands-off management style that causes chaos for associates and paralegals;" "lawyers who are managers thinking they can direct people;" lawyer managers finding/using time to actually do the management part of their job;" "poor quality of life for associates/poor management by partners;" "indecisiveness/inaction;" and finally, one that constitutes perhaps the cardinal sin, entitling the offender to immediate admission to Dante's innermost circle of Hell:  "lack of vision from the top."

A strong theme also emerged centered on the difficulty of achieving cultural change.  "Figuring out how to shepard [sic] change in the legal profession" expressed it most clearly, but it also arose in what might be called the obverse, such as:  "The complete inability of old school lawyers (who constitute 95% of all decision makers) to grasp technology-related issues as it relates to litigation.  It is debilitating!"

A group of ever-present issues also made a strong showing here, including:

• marketing and business development;
• work/life balance, the relentless pressure to amass billable hours, and the haziness of padding and client expectations; and
• profitability in general, usually expressed as a desire for more revenue or, as one pithily put it, less "COST."

Interestingly, certainly to me, was that knowledge management came up repeatedly.   It sounds as though firms know they need it.

But the most intriguing by far speaks to tectonic changes that may be taking place in the structure of the industry at large:  A surprising number of respondents worried about the consolidation trend among law firms, expressed variously as:

• "Uncertainty as to the future for mid-size (AmLaw 200 but not 100) firms, especially outside NY;"
• "[being] national, specialized and staying profitable and independent;"
• "staying competitive without having to bulk up in size like everyone else;"
• "growth (industry consolidation);"
• "how to respond to globalization;" and lastly, a comment evidently from the UK about client-generated pressures in the brave new world of "panels" and "preferred providers:"
• "variable growth as a result of increasing tenders; you are either on the panel with lots of work (and needing to quickly hire staff), or suddenly off the panel with corresponding overstaffing."

All in all, a basket full of serious, thorny, deeply challenging issues.  I humbly give you all enormous credit.

The final question, asking for the "unvarnished truth" in terms of other editorial comments/suggestions/critiques, I will save for a separate post.  Stay tuned.