The elastic tournament: A second transformation of the Big Law Firm

Stanford Law Review

Volumn 60, Issue 6, 2008, Pages 1867-1929

  Galanter, Marc ^a,b   Henderson, William ^c,d  

^a UNIVERSITY OF WISCONSIN LAW SCHOOL   (United States)

^b LONDON SCHOOL OF ECONOMICS   (United Kingdom)

^c INDIANA UNIVERSITY   (United States)

^d AMERICAN BAR FOUNDATION   (United States)

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[No Author keywords available]

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EID: 46749135819     PISSN: 00389765     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Review

References (312)

1. CLARA N. CARSON, THE LAWYER STATISTICAL REPORT: THE U.S. LEGAL PROFESSION IN 2000, at 6 tbl.6 (2004). This is a serial publication of the American Bar Foundation, which compiles the data on a regular five-year cycle. The following table summarizes lawyers by practice setting: (Table Presented)
2. See id. at 7 tbl.7 (showing the proportion of attorneys in solo private practice declining from 64% in 1960 to 48% in 2000). In urban areas, the decline in solo practice is even more pronounced. See JOHN P. HEINZ ET AL., URBAN LAWYERS: THE NEW STRUCTURE OF THE BAR 100-01 & fig.5.1 (2005) (reviewing evidence that the proportion of solo practitioners in Chicago diminished from 21% to 15% between 1975 and 1995).
3. See, e.g., Conference on the Commercialization of the Legal Profession, 45 S.C. L. REV. 875 (1994) (two of four articles focus on large law firms);
4. Symposium, Empirical Studies of the Legal Profession: What Do We Know About Lawyers Lives?, 84 N.C. L. REV. 1415 (2006) (six out of eight articles focus on large law firms);
5. Symposium, The Future of the Legal Profession, 44 CASE W. RES. L. REV. 333 (1994) (all seven articles focus on large corporate firms or using them as a point of contrast). Recognizing their disproportionate influence (and, presumably, their appeal to aspiring lawyers), many symposia specifically focus on large law firms.
6. See, e.g., Symposium, Attorney Well-Being in Large Firms: Choices Facing Young Lawyers, 52 VAND. L. REV. 869 (1999);
7. Stein Center Conference: Professional Challenges in Large Law Firm Practices, 33 FORDHAM URB. L.J. 1 (2005);
8. Symposium on the Corporate Law Firm, 37 STAN. L. REV. 271 (1985);
9. Symposium, The Growth of Large Law Firms and Its Effect on the Legal Profession and Legal Education, 64 IND. L.J. 421 (1989);
10. cf. RICHARD L. ABEL, AMERICAN LAWYERS 182 (1989) (reporting that as of 1980, only 9.2% of lawyers worked in law firms with more than twenty lawyers, yet "such firms have become the most conspicuous feature in the American legal landscape").
11. See, e.g., HEINZ ET AL., supra note 2, at 144 fig.6.2 (reporting that in 1975, 5% of Chicago lawyers commenced their careers at a firm of one hundred or more lawyers, compared to 19% in 1995); RONIT DINOVITZER ET AL., AFTER THE JD: FIRST RESULTS OF A NATIONAL STUDY OF LEGAL CAREERS 25-27 & tbl.3.1 (2004) (reporting that 28% of recent law school graduates works in large firms (>100) compared to 8% of all lawyers).
12. Aric Press, The New Reality, AM. LAW., Aug. 2007, at 91.
13. Id.
14. See MILTON C. REGAN JR., EAT WHAT YOU KILL: THE FALL OF A WALL STREET LAWYER 22-23 (2005) (discussing how recruitment and training of Cravath associates was an "attempt[ ] to establish a distinctive brand in the legal services marketplace" and thus set it "apart from its potential competitors");
15. Lawrence J. Fox, The End of Partnership, 33 FORDHAM URB. L.J. 245, 245 (2005) (noting as a law firm partner that large firms perpetuate the myth that they only interview at "the very best schools and seek to recruit the very best law students").
16. Press, supra note 5.
17. William D. Henderson & Andrew P. Morriss, Student Quality as Measured by LSAT Scores: Migration Patterns in the U.S. News Rankings Era, 81 IND. L.J. 163, 195 (2005) (discussing how higher salaries accompanying higher debt loads at elite schools result in "an effective transfer [of wealth] from the large firms (and so from their clients) to elite and semi-elite law schools");
18. see also Randolph N. Jonakait, The Two Hemispheres of Legal Education and the Rise and Fall of Local Law Schools, 51 N.Y.L. SCH. L. REV. 863, 864-65 (2007) (discussing deleterious consequences of local law schools trying to emulate elite counterparts without the lifeblood of large firm jobs).
19. See HEINZ ET AL., supra note 2, at 287 (attributing large law firm size to greater corporate demand and positing several likely explanations); John P. Heinz, Robert L. Nelson & Edward O. Laumann, The Scales of Justice: Observations on the Transformation of Urban Law Practice, 27 ANN. REV. SOC. 337, 342 (2001) (same);
20. Randall S. Thomas, Stewart J. Schwab & Robert G. Hansen, Megafirms, 80 N.C. L. REV. 115, 136-52 (2001) (same);
21. see also Marc Galanter, Planet of the APs: Reflections on the Scale of Law and Its Users, 53 BUFF. L. REV. 1369 (2006) (noting increasing share of corporations as consumers of legal services).
22. See, e.g., HEINZ ET AL., supra note 2, at 166-67 & fig.7.2 (reporting declines, from 1975 to 1995, in real income for equity partners in firms of two to one hundred lawyers but a 44% rise within firms of 101 to 299 lawyers and "the highest incomes of all" among partners in largest firms); William D. Henderson, Financial and Billing Survey of ISBA Lawyers, Presentation to Indiana State Bar Association Solo & Small Firm Conference (June 1, 2007) (on file with author) (reporting linear relationship between firm size and growth in real income over the last five years).
23. Larry Kramer, From the Dean, STAN. LAW., Fall 2007, at 1.
24. Id. One Stanford Law alumnus referred to Kramer's observations as "nonsense on stilts." See Adam Smith, Esq., http://www.bmacewen.com/blog (Oct. 31, 2007, 11:57 EST). However, the alumnus works as management consultant to law firms.
25. See MARC GALANTER & THOMAS PALAY, TOURNAMENT OF LAWYERS: THE TRANSFORMATION OF THE BIG LAW FIRM 99-102 (1991). During the last fifteen years, the promotion-to-partner tournament has provoked a lively and provocative literature.
26. See, e.g., Marc Galanter & Thomas Palay, A Little Jousting About the Big Law Firm Tournament, 84 VA. L. REV. 1683 (1998);
27. Bruce M. Price, How Green Was My Valley? An Examination of Tournament Theory as a Governance Mechanism in Silicon Valley Law Firms, 37 LAW & SOC'Y REV. 731 (2003);
28. David B. Wilkins & G. Mini Gulati, Reconceiving the Tournament of Lawyers: Tracking, Seeding, and Information Control in the Internal Labor Market of Elite Law Firms, 84 VA. L. REV. 1581 (1998);
29. Frederick W. Lambert, An Academic Visit to the Modern Law Firm: Considering a Theory of Promotion-Driven Growth, 90 MICH. L. REV. 1719 (1992) (book review);
30. Kevin A. Kordana, Note, Law Firms and Associate Careers: Tournament Theory Versus the Production-Imperative Model, 104 YALE L.J. 1907, 1923-33 (1995).
31. See infra Part II.
32. Drawing upon the framework developed by Gilson and Mnookin, this outcome has occurred because of the erosion of "firm-specific" capital. In earlier years, clients were strongly wedded to specific law firms, due in part to high switching costs for clients and to professional norms that discouraged mobility. As a result, corporate law firms could credibly offer entry-level associates the prospect of lifetime employment. See Ronald J. Gilson & Robert H. Mnookin, Sharing Among the Human Capitalists: An Economic Inquiry into the Corporate Law Firm and How Partners Split Profits, 37 STAN. L. REV. 313, 353-71 (1985) (discussing advantages and sources of firm-specific capital).
33. ROBERT L. NELSON, PARTNERS WITH POWER: SOCIAL TRANSFORMATION OF THE LARGE LAW FIRM 5 (1988) (observing that "the organizational rationalization of the firm will be controlled by the partners with power," which is "inextricably tied to 'control of clients'").
34. Cf. REGAN, supra note 7, at 37 (noting "the irony: large firms a generation ago were loosely organized but tightly integrated, while today's firms are more formally organized but only loosely integrated.").
35. See William D. Henderson, An Empirical Study of Single-Tier Versus Two-Tier Partnerships in the Am Law 200, 84 N.C. L. REV. 1691, 1742-44 & nn. 188-89 (2006) (discussing instability of firms that permit cross-subsidies between productive and nonproductive partners).
36. Press, supra note 5 ("[T]here is a price point [for associate salaries] that not all Am Law 200 firms will be willing to match. We're confident that that number begins with a 2.").
37. See, e.g., Marisa McQuilken, Students Seek a More Reasonable Law Firm Life - Before They Even Start, LEGAL TIMES, Sept. 3, 2007, at 26 (discussing how several Stanford Law students organized "Law Students Building a Better Legal Profession" in reaction to a "law firm culture bereft of work-life balance").
38. For example, in the late 1960s and early 1970s, law students pressed corporate law firms for progressive reforms remarkably similar to the current generation. See Ralph Nader, Law School and Law Firms, 54 MINN. L. REV. 493, 497-500 (1970) (discussing how students "have considerable leverage" and that "[w]hatever the outcome, the big firms will never be the same").
39. See generally GALANTER & PALAY, supra note 14. Of course, the definition of "large" has continuously changed as the size of the largest units has grown. One recent story asserted that midsized firms "range from 180 to 500 attorneys firmwide." Lynne Marek, Chicago's Midsize Firms Look to Stay Independent, NAT'L L.J., July 9, 2007, at 10. Applying this definition to the 2007 NLJ 250, 84 U.S.-based law firms are large (i.e., more than 500 lawyers), 151 are midsized (180 to 500), and 15 are small.
40. See, e.g., Peter D. Sherer, Leveraging Human Assets in Law Firms: Human Capital Structures and Organizational Capabilities, 48 INDUS. & LAB. REL. REV. 671, 672-75 (1995) (discussing the evolution and success of the large law firm and attributing core features to the widespread adoption of the "Cravath Model").
41. See generally GALANTER & PALAY, supra note 14, at 37-76 (reviewing how the tournament structure adapted to a wide range of systemic changes that affected the legal profession).
42. See, e.g., Marc Galanter & Simon Roberts, From Kinship to Magic Circle: The London Commercial Law Firm in the 20th Century (Aug. 6, 2007) (unpublished manuscript, on file with author) (chronicling the adoption of the U.S. tournament model by British solicitors in the middle decades of the twentieth century).
43. See, e.g., Bryant G. Garth, Legal Education and Large Law Firms: Delivering Legality or Solving Problems, 64 IND. L.J. 433, 433 (1989) ("Large law firms are the most successful institutional component of the American legal profession according to the criteria of economic prosperity, proximity to the corridors of economic and political power, and the influence exerted on the legal profession generally."); Gilson & Mnookin, supra note 16, at 313, 386-89 (acknowledging inevitable changes in market for corporate legal services but predicting continued growth and stability for the nation's largest firms);
44. Robert L. Nelson, Ideology, Practice, and Professional Autonomy: Social Values and Client Relationships in the Large Law Firm, 37 STAN. L. REV. 503, 545 (1985) ("[T]he large law firm has been hugely successful as an economic enterprise, commanding increasingly larger proportions of the revenues paid for private legal services and growing far more rapidly than the legal profession as a whole.").
45. See generally GALANTER & PALAY, supra note 14, 37-76 (observing that in a more competititive environment, firms respond to increased mobility by shifting from equal shares and seniority as the basis of partner compensation to formulas that emphasize reward for productivity and business-getting).
46. The lexicon for these non-partner positions is large. See, e.g., George P. Baker & Rachel Parkin, The Changing Structure of the Legal Services Industry and the Careers of Lawyers, 84 N.C. L. REV. 1635, 1641 n.11 (2006) (analyzing the Martindale-Hubbell Law Directory and classifying the following positions as "off-track": attorney, associate counsel, counsel, consultant, of counsel, senior attorney, senior counsel, and special counsel).
47. For a detailed discussion of the advent, development, and incentive structures of two-tiered partnerships, see Henderson, supra note 19, at 1699-713.
48. As noted by Erwin Smigel in his seminal study of Wall Street law firms, "Custom and power have ordained that the senior partners generally have the largest rooms . . . . Courtesy and the recognition that inevitably everyone grows old guarantees that a very old partner, no longer in power, retains his large office, even though he is not currently 'earning' it." ERWIN O. SMIGEL, THE WALL STREET LAWYER 209 (1969).
49. Cf. Fox, supra note 7, at 247 ("[E]levation to partnership no longer comes with any sense of tenure. . . . [Because of shifting norms,] law firms are now free, with little, if any, guilt to ease out partners who are viewed as less than productive (productive being defined by criteria that were far different from the standards that were applied when these folks were admitted to the partnership . . . .)").
50. Although most large firms have mandatory retirement policies, a vibrant lateral partner market is increasingly undercutting their intended effect. See Elizabeth Goldberg, Desperately Seeking Seniors, AM. LAW., Sept. 2007, at 17.
51. See REGAN, supra note 7, at 34-35 (noting how firms have embraced the lateral market as a way to acquire specialized lawyers or practice groups and that "an increasingly large percentage of law firm partners are not associates who are promoted from within, but arrivals from other firms"); Fox, supra note 7, at 248 (observing that a partner's true worth is now determined by the lateral market).
52. See JOHN C. COFFEE JR., GATEKEEPERS: THE PROFESSIONS AND CORPORATE GOVERNANCE 227 (2006) (reporting the "decline in law firm stability as 'star' attorneys increasingly practice in a free agent market").
53. Compare REGAN, supra note 7, at 25 (reporting that promotion to partner formerly denoted "a share of the firm's profits, a voice in the firm's governance, and considerable independence from supervision by other lawyers"), with Fox, supra note 7, at 248 (noting that "real partners" at any firm are "those whose books of business exceed a very significant number - say a million, two million, or three, depending on the firm and the city").
54. See, e.g., REGAN, supra note 7, at 37 ("[T]oday's large firm has many more formal organizational controls, such as hierarchical chain of command, more professional managers in positions of authority, distinct practice departments, and detailed financial management and reporting systems," partially because "firms no longer are able to rely on informal social norms to regulate behavior . . . .").
55. See Henderson, supra note 19, at 1710 (noting empirical evidence of a "perpetual tournament involving both associates and partners"); see also REGAN, supra note 7, at 37 (same).
56. See infra notes 85-86 and accompanying text (discussing the rapid growth of non-equity partners as the total number of equity partners leveled off).
57. For a statistical overview of the age-related demographics of the legal profession, including the imminent retirement of a large number of boomer lawyers, see Marc Galanter, "Old and In the Way": The Coming Demographic Transformation of the Legal Profession and Its Implications for the Provision of Legal Services, 1999 WIS. L. REV. 1081, 1084-86 (presenting statistical evidence that the proportion of older (older than 50) to younger (younger than 40) lawyers is increasing over time, with a sharp increase expected after 2005).
58. Drawing upon reports of group movement in a weekly newsletter distributed by Hildebrandt International, Inc., we counted 249 instances of multi-lawyer movement between January 2005 and May 2007, averaging 7.5 lawyers per multi-lawyer movement). See HILDEBRANDT HEADLINES (Research & Analysis Group, Hildebrant In'l, Somerset, N.J.), Jan. 2005-May 2007.
59. See infra Part II.A.
60. See GALANTER & PALAY, supra note 14, at 71 (discussing the birth of the legal press in the aftermath of the Supreme Court's decision in Bates v. State Bar of Ariz., 433 U.S. 350 (1977)).
61. See JOHN P. HEINZ & EDWARD O. LAUMANN, CHICAGO LAWYERS: THE SOCIAL STRUCTURE OF THE BAR 319-33 (1982). We do not know whether there is an analogous change within the personal services hemisphere.
62. See GALANTER & PALAY, supra note 14, at 70-73 (discussing the effect of Bates on lawyers' willingness to share information).
63. The American Lawyer has contributed to the sweepstakes atmosphere through its monthly Big Suits, Big Deals column, which culminates in an annual ranking of elite firms and lawyers.
64. See generally ROBERT H. FRANK & PHILIP J. COOK, THE WINNER-TAKE- ALL SOCIETY (1995) (arguing that high incomes at the top have drawn too many talented people into the legal profession). Longitudinal data from the Chicago Lawyers I and II data provided tentative support for this claim, though primarily among practitioners with the lowest concentrations of business clients.
65. See Rebecca L. Sandefur & John P. Heinz, Winner-Take-All Markets for Legal Services and Lawyers ' Job Satisfaction (Am. Bar Found. Working Paper No. 9906, 1999). This may be changing, however. Since 1995, when the Chicago Lawyers II data was collected, profits per partner have risen dramatically for large law firms, and fewer lawyers are making it into the equity tier. See infra Part II.
66. See FRANK & COOK, supra note 47, at 47 (asserting that "the most profound changes in the underlying forces that give rise to winner-take-all effects have stemmed from technological developments in two areas - telecommunications and electronic computing").
67. See GALANTER & PALAY, supra note 14, at 7-8 (reviewing how changes in technology have consistently had large impacts on the organization and functioning of law firms).
68. See Heinz, Nelson & Laumann, supra note 10, at 348-49. They argue that the ascendancy of inside counsel reduced the practice of outside law firms referring cases to friendly out-of-town firms and observe that "[s]ince Chicago firms were then no longer dependent upon the goodwill of New York firms for referrals (and vice versa), there was less reason to refrain from direct competition." See also HEINZ ET AL., supra note 2, at 299 (arguing the same).
69. See supra Part I.
70. See GALANTER & PALAY, supra note 14, at 100. In recent years, the average time period to promotion has elongated. See Baker & Parkin, supra note 29, at 1670-72 & tbls.9 & 10 (reporting that between 1998 and 2003, the average time for promotion to partner for all firms in the Martindale-Hubbell Law Directory increased from 9.13 to 9.65 years).
71. See Marc Galanter & Thomas Palay, The Many Futures of the Big Law Firm, 45 S.C. L. REV. 905, 909-12 (1994) (discussing mutually reinforcing economics that underlie the promotion-to-partnership tournament);
72. see also Leonard Bierman & Rafael Gely, So, You Want to Be a Partner at Sidley & Austin?, 40 HOUS. L. REV. 969, 978-86 (2003) (applying Internal Labor Market theory to a law firm partnership context and arguing that the promise of long-term security as a partner can induce younger lawyers to make firm-specific investments that benefit the firm).
73. See, e.g., supra note 14; see also George Rutherglen & Kevin A. Kordana, A Farewell to Tournaments? The Need for an Alternative Explanation of Law Firm Structure and Growth, 84 VA. L. REV. 1695, 1696 (1998) (arguing that the promotion-to-partnership tournament has become "only one factor among many that contribute to the organizational structure of the large law firm");
74. Robert L. Nelson, Of Tournaments and Transformations: Explaining the Growth of Large Law Firms, 1992 WIS. L. REV. 733, 748-49 (book review) (suggesting that tournament theory does not fit all of the empirical data and suggesting the need for other explanations).
75. Of course, the proliferation of the non-equity partnership is a significant development, which we address shortly. See infra Part II.B.
76. See generally NALP DIRECTORY OF LEGAL EMPLOYERS 2005-2006 (2005) (providing detailed information on over six hundred corporate law firms, including the length of the partnership track and whether the firm has a single or multi-tier partnership structure).
77. For fiscal year 2006, the average starting salary in an NLJ 250 firm (weighted by number of associates) was $131,400 with a standard deviation of $14,900. Calculation by authors from data provided by the Law Firms Working Group.
78. Academic commentators and journalists often discuss large law firms as if they comprise a single unitary category. In fact, different endowments of reputational capital are associated with differences in clients, practice area concentrations, incentives for specialization, recruitment strategies, utilization of non-equity partnership structures, hours worked, and remuneration for associates and partners. See William D. Henderson & David Zaring, Young Associates in Trouble, 105 MICH. L. REV. 1087, 1096-102 (2007) (book review) (using multivariate regression and descriptive statistics to explore differences between large firms).
79. We used the natural log of the growth rate based on our assumption that the marginal benefits of growth taper off at higher levels. The comparison group here consists of 117 firms who appeared on the NLJ 250 in 1978 and 2007 (to calculate growth rate of partnerships) and were listed on the Am Law 200 for fiscal year 2005 (to make financial comparisons).
80. See Henderson, supra note 19, at 1728-29 & tbl.7 (summarizing data).
81. See Gilson & Mnookin, supra note 16, at 356 (opining that partners at firms with high levels of reputational capital are less likely to make higher income elsewhere, thus providing "glue" to hold the partnership together); Henderson, supra note 19, at 1703 (same).
82. Cf. NELSON, supra note 17, at 49 (observing that highly prestigious firms experienced slow growth during the time period studied); Heinz, Nelson & Laumann, supra note 10, at 352 (theorizing that the slow-growth strategy appeals to firms with concern for maintaining quality personnel and confidence in their ability to keep clients).
83. The slower growing partnerships have an average of 399 attorneys at 6.0 branch offices; in contrast, the remaining 107 firms averaged 620 attorneys spread over 9.7 offices. Calculation by authors from data provided by the Law Firms Working Group.
84. This firm contains a single office and is based in a city that is home to many high-tech companies, according to data provided to the authors by the Law Firms Working Group.
85. Using an independent sample t-test, the PPP for the ten slowest-growing partnerships was statistically different from the mean of the rest of the sample at p <0.000 (t-statistic = 4.364).
86. Using an independent sample t-test, the ratio of associates to partners for the ten slowest-growing partnerships was statistically different from the mean of the rest of the sample at p <0.000 (t-statistic = 4.451).
87. See Deborah Graham, Branch Offices Crucial in Firm's Growth Strategies, LEGAL TIMES, Sept. 21, 1981, at 29 (reporting how Cravath, Swaine & Moore is bucking the trend of adding branch offices and partners). The article quotes the Cravath's David Owen Brownwood, who states: "[We have] a different view as to the structure of the law firm and the role of the partner. . . . [Our] ability to grow is limited by the number of people we can effectively train." Id.
88. Thomas, Schwab & Hansen, supra note 10, at 144 (describing how Wachtell Lipton has defied the authors' "megafirm" model through "its dominant market position as the premier defense firm in the mergers and acquisitions business").
89. The Cahill Way, AM. LAW., July 2003, at 92 (reporting on Cahill Gordon & Reindel's highly lucrative junk bond practice, how it has spurned growth in firm size and partnership, and how it has achieved profitability on par with Wachtell Lipton and Cravath, Swaine & Moore).
90. Thomas, Schwab & Hansen, supra note 10, at 142-43 (arguing that Skadden Arps "reacted to client demand for more services by first expanding into more domestic practice areas, and then internationally to open offices in other countries" and noting that "many other rival large firms acted (or reacted) in the same way").
91. See LINCOLN CAPLAN, SKADDEN: POWER, MONEY, AND THE RISE OF A LEGAL EMPIRE 282-86 (1993) (reporting a detailed account of the firm's decision to open offices in several key international cities). In a memo, managing partner Peter Mullin explained that, "[t]his expansion makes sense if we are going to be a major international player, which I strongly believe we should and must be." Id. at 286.
92. Id. at 295 (noting that the same work at Cleary Gottlieb was called "throwaway work" because the process of identifying and quantifying its value was "so difficult that it wasn't done").
93. See, e.g., Edward A. Adams, No 'Cold Calls,' NAT'L L.J., Dec. 11, 1989, at 2 ("Skadden is thought to hire the largest number of lateral associates of any firm in the nation.");
94. Alison Frankel, Who's Going Global?, N.J. L.J., Nov. 6, 2000, at 33 ("Using its own successful national expansion to Chicago and Los Angeles as its guide, Skadden plans to continue to grow overseas . . . by hiring established lateral partners in cities where Skadden's expertise in mergers and acquisitions and capital markets can be exploited.");
95. Michael Orey, Capitalizing on Structured Finance, AM. LAW., Apr. 1987, at 12 (noting that Skadden Arps "built its structured-finance practice through aggressive lateral hiring").
96. CAPLAN, supra note 71, at 250-53 (reporting on tightening of partnership promotions and perceptions among associates that "Skadden's [partnership] was far less accessible to them than what the firm's leaders, and its recruiting videotape, had portrayed").
97. Stated mathematically, if an associate is risk neutral, a 10% chance of a $2 million per year partnership is valued the same as a 40% chance of a $500,000 per year prize - both have an expected value of $200,000 per year.
98. See NELSON, supra note 17, at 8 (discussing opening branch offices to defend a client base).
99. For locations in the United States, our definition of markets relies upon metropolitan areas rather than municipal boundaries. Under the system adopted by the Census Bureau in 2003, metropolitan areas are delineated by Core-Based Statistical Areas (CBSA). Where more than one CBSA are adjacent to one another and commuting patterns suggest interrelated labor markets, the CBSAs are bundled into a single Consolidated Statistical Area (CSA). If the location fell within a CSA, it was coded accordingly; otherwise, we used the CBSA code. Foreign offices were coded using a scheme we created.
100. See D. Daniel Sokol, Globalization of Law Firms: A Survey of the Literature and a Research Agenda for Further Study, 14 IND. J. GLOBAL LEGAL STUD. 5, 11 (2007) ("U.K. firms are under attack by U.S.-based competitors, particularly for high-end deal work that requires medium rather than large resources.").
101. See, e.g., Heather Smith, Branch Office Basics, AM. LAW., Oct. 2003, at 57 ("New offices and practices are expensive to establish, and if they don't become profitable, they can be big drains [on firm resources].");
102. Sherry R. Sontag, Opening Offices Overseas: Does the Payoff Warrant the Huge Expense?, NAT'L L.J., Feb. 12, 1990, at 1 ("[M]any firms opening [overseas] offices can expect to lose money for more than five years. By contrast, new U.S. branches are often profitable within two to three years.").
103. Thomas S. Clay, Branch Economics: The Decision to Open a New Office Should Be Based on Hard Data, LEGAL TIMES, Mar. 18, 2002, at 48 (reporting on how economic performance of branch offices is a source of discord within large firms).
104. We calculated this figure using a file of lateral partners maintained by American Lawyer Media. We coded branched offices using the U.S. Census Bureau FIPS codes for each metropolitan area. An electronic newsletter published weekly by Hildebrandt International, Inc. corroborates the relationship between new branch offices and heightened local competition. See HILDEBRANDT HEADLINES, supra note 41 (reporting 249 examples of lateral movement involving two or more lawyers with an average of 7.5 lawyers per movement between January 2005 and July 2007).
105. See, e.g., WILLIAM G. JOHNSTON, INTERNATIONAL, INC., ANATOMY OF LAW FIRM FAILURES 14-16 & ex. A (2004) (concluding that partner defections were catalysts in numerous large firm dissolutions between 1998 and 2004).
106. We begin the analysis with fiscal year 1984 because from that year forward, at least 231 firms in any year also appeared on the NLJ 250 for the prior year. Prior to 1984, the largest number of repeat NLJ 250 firms was 194. In 1994, the NLJ began collecting data on non-equity partners.
107. Note that this figure probably understates the true magnitude of the shift to non-equity partnerships. Since 1994, approximately two dozen NLJ 250 firms have declined to provide a breakdown between equity and non-equity partners. We suspect this is because it would reveal significant changes in the firm's internal structure toward a larger non-equity tier. See also Henderson, supra note 19, at 1695 (documenting rapid movement toward two-tier partnerships).
108. See Kimberly Kirkland, Ethics in Large Law Firms: The Principle of Pragmatism, 35 U. MEM. L. REV. 631, 694 & n.227 (2005) (quoting law firm equity partner who said that "the first question" that is asked in the partnership decision is whether the lawyer would leave if not made an equity partner).
109. See ROBERT W. HILLMAN, HILLMAN ON LAWYER MOBILITY: THE LAW AND ETHICS OF PARTNER WITHDRAWALS AND LAW FIRM BREAKUPS § 1.2 (1998 & 2004 supp.); see also REGAN, supra note 7, at 47 (discussing how de-equitizations at Milbank Tweed in 1987 reflected a sea change in the firm's culture);
110. Lynne Marek, Jenner and Block Takes Some Partners off Equity Level, NAT'L L.J., June 11, 2007, at 10 (reporting that between fifteen and twenty Jenner & Block attorneys would be moved to the non-equity tiers and that Chicago-based competitor Mayer Brown recently de-equitized forty-five partners);
111. Gina Passarella, De-Equitization Persists Despite Better Economic Times for Firms, RECORDER, Oct. 11, 2006, at 2 (reporting on persistence of de-equizations despite strong economy and law firm growth).
112. REGAN, supra note 7, at 25 (discussing benefits of Wall Street law partnerships during the 1950s and 1960s).
113. See Henderson, supra note 19, at 1710 (citing 2004 Altman Weil Survey of Law Firm Economics).
114. Indeed, at $160,000 per year, a slacking associate can pay off his or her entire legal education before firm management broaches the issue of underperformance. See, e.g., KERMIT ROOSEVELT, IN THE SHADOW OF THE LAW (2005) (suggesting that large paychecks entice many young lawyers to take large firm jobs with the clear intention of shirking and leaving).
115. See Henderson & Zaring, supra note 58, at 1102 & tbl.5.
116. Id.; see also Amy Kolz, Can You Hear Me Now?, AM. LAW., Oct. 2005, at 107 (reporting results of annual survey of third,
117. See Henderson & Zaring, supra note 58, at 1100-01 & tbl.4 (discussing results of a multivariate analysis of law firm profitability that used the same Am Law midlevel associate data).
118. LESLIE D. CORWIN & ARTHUR J. CIAMPI, LAW FIRM PARTNERSHIP AGREEMENTS (1998).
119. Leslie D. Corwin, Response to Loyalty in the Firm: A Statement of General Principles on the Duties of Partners Withdrawing from Law Firms, 55 WASH. & LEE L. REV. 1055, 1056 (1998).
120. See, e.g., ANTHONY T. KRONMAN, THE LOST LAWYER 277 (1993).
121. Access to key benchmarking information is not limited to The American Lawyer and the National Law Journal. For example, the Law Firm Group at Citibank, which often has negotiated access to law firm information systems, conducts a detailed annual benchmarking process for law firms. In the most recent survey, over 90% of Am Law 100 firms participated. See Citi Private Bank: The Law Firm Group, http://www.citibank.com/privatebank/ law_firms_9.htm.
122. See GALANTER & PALAY, supra note 14, at 33-34.
123. SOL M. LINOWITZ, THE BETRAYED PROFESSION: LAWYERING AT THE END OF THE TWENTIETH CENTURY 186-87 (1994) (discussing how higher legal costs cause many large corporations to build rather than buy necessary legal inputs, thus leading to many large firms "sprout[ing] within the Fortune 500 companies"); Heinz, Nelson & Laumann, supra note 10, at 347-48 (discussing how bureaucratization of the in-house lawyer role reduced the role of outside law over corporate decision making).
124. See GALANTER & PALAY, supra note 14, at 50 ("In their relationship with outside law firms, today's enlarged corporate legal departments impose budgetary restraints, exert more control over cases, demand periodic reports, and engage in comparison shopping among firms."); Mark C. Suchman, Working Without a Net: The Sociology of Legal Ethics in Corporate Litigation, 67 FORDHAM L. REV. 837, 856 (1998) (reporting large in-house departments have turned corporations into "unprecedentedly informed consumers of professional services").
125. REGAN, supra note 7, at 33 (noting that companies are now "more concerned with retaining individual lawyers than specific firms"); Gilson & Mnookin, supra note 16, at 385 ("The catchphrase now is: 'Shop for a lawyer, not a law firm.'").
126. See CAPLAN, supra note 71, at 63-73 (discussing rise of mergers-and acquisitions-practice and reluctance of established Wall Street firms to get involved, even when clients were under siege by corporate raiders).
127. On the demise of the barriers against Jewish lawyers in the world of large New York firms, see Eli Wald, The Rise and Fall of the WASP and Jewish Law Firms, 60 STAN. L. REV. 1803 (2008).
128. CAPLAN, supra note 71, at 71.
129. Id.
130. 433 U.S. 350 (1977).
131. See GALANTER & PALAY, supra note 14, at 71 ("Bates liberated lawyers to talk to the press about their practices, for they no longer feared being accused of advertising."); LINOWITZ, supra note 98, 31-33 (former general counsel for Xerox Corporation blaming Bates for the erosion of professional values and the excessive focus on law firm finances).
132. See Russell G. Pearce, The Professionalism Paradigm Shift: Why Discarding Professional Ideology Will Improve the Conduct and Reputation of the Bar, 70 N.Y.U. L. REV. 1229, 1254 & n.133 (1995) (reporting on emergence of these publications and sources about their origins).
133. CAPLAN, supra note 71, at 80.
134. Id.
135. This list began in 1985 as the Am Law 50. It was expanded to the Am Law 75 in 1986, the Am Law 100 in 1987, and the Am Law 200 in 1999.
136. This systemic change between 1975 and 1995 is observed in the Chicago Lawyers II study. See HEINZ ET AL., supra note 2, at 297-99 ("A key factor in weakening the ties between law firms and their clients was the changing role of corporate inside counsel [who by 1995 increasingly came to] mediate the relationships between outside lawyers and corporate management, monitor and evaluate the performance of outside lawyers, review billings from law firms, and exercise judgment about whether . . . charges [were] excessive."); see also LINOWITZ, supra note 98, at 82-83 (asserting that proliferation of legal issues during the post-World War II era meant "no single outside lawyer" could answer executives' legal questions and the perceived answer was in-house general counsel as a mediator between management and outside lawyers).
137. See HILLMAN, LAWYER MOBILITY, supra note 866, § 1.1 & n.12 (supp. 2007) ("[I]ncreased mobility has permitted lawyers with the ability to transport clients and revenues to demand a larger share of firm income.").
138. See CAPLAN, supra note 71, at 99 (reporting on the firm's shrewd use of legal press). Further, profiles of successful lawyers at other firms were often used as a means of identifying lateral candidates "for acquisition." Id. (quoting firm managing partner); see also PAUL HOFFMAN, LIONS OF THE EIGHTIES: THE INSIDE STORY OF THE POWERHOUSE LAW FIRMS 340 (1982) (noting the rise of the legal press in work by author who wrote two journalistic accounts of elite law firms in the early 1970s and 1980s);
139. Bruce E. Aronson, Elite Law Firm Mergers and Reputational Competition: Is Bigger Really Better? An International Comparison, 40 VAND. J. TRANSNAT'L L. 763, 770 n.11 (2007) ("Changes in the law firms' operating environment and the firms' responses to such changes can be conveniently tracked by the growth and expansion of the legal press. In the early 1980s, the legal press began to provide extensive coverage on what had generally been private matters within firms.");
140. Marc Galanter, The Legal Malaise; Or, Justice Observed, 19 LAW SOC'Y REV. 537, 547 (1985) (discussing advent of "National Law Journal, The American Lawyer, [and] Legal Times" during the late 1970s that provided details of law firms developments and finances that "all but a few insiders or dedicated students could have known a few years back.").
141. See CAPLAN, supra note 71, at 99-100.
142. See supra note 81 and accompanying text.
143. See Susan Saab Fortney, Soul for Sale: An Empirical Study of Associate Satisfaction, Law Firm Culture, and the Effects of Billable Hour Requirements, 69 UMKC L. REV. 239, 247 & n.40 (2000) (discussing the emergence of new software that tracks billable hours, collection rates, and profitability of specific matters);
144. Bruce A. Green, Professional Challenges in Large Firm Practices, 33 FORDHAM URB. L.J. 7, 21-22 (2005) (citing comments of law firm partner during conference proceedings).
145. The Du Pont Legal Model is a specific set of guidelines to assist large corporate legal departments in the management of outside counsel. See Du Pont Legal Model, http://www.dupontlegalmodel.com/competitiveedge.asp (follow "Information Technology - The EDGE" hyperlink) ("The heart of strategic partnering [with outside law firms] at DuPont is knowledge transfer and communication.").
146. See Milton C. Regan, Jr., Law Firms, Competition Penalties, and the Values of Professionalism, 13 GEO. J. LEGAL ETHICS 1, 53 & nn.277, 282 (discussing features and influence of Du Pont Model, including adoption of technology to facilitate information sharing).
147. See James Evangelista, Teresa Stange & Kelley Johnston, Electronic Billing Offers Advantages, NAT'L L.J., Sept. 26, 2005, at S1 (reporting on wide adoption of this technology by Fortune 100 companies and the use of electronic invoices by the vast majority of the top 200 U.S. law firms);
148. Rob Thomas, Managing Outside Counsel: New Survey Reveals Clients Are Imposing More Constraints on Their Law Firms, LEGAL TIMES, NOV. 17, 2003, at 22 ("An increasing number of in-house counsel are . . . requiring electronic billing, which gives them direct access to financial data for each matter and [enables] . . . automated systems to audit bills and compare actual spending with budgets.").
149. Kirkland, supra note 85, at 675 (reporting on pressures faced by lawyers who lose important clients and observing that lawyer's standing in firm is contingent on his relationship with his clients).
150. See Henderson, supra note 19, at 1743 (noting that primary benefit of two-tier partnership is not necessarily higher profits but heightened stability through a structure that privileges rainmakers).
151. Kirkland, supra note 85, at 675 ("This partner must either find new clients or resign and take his existing clients to a firm that charges lower rates [when rates exceed what clients will pay].").
152. See HEINZ ET AL., supra note 2, at 304 (observing that norms of cooperation and collegiality require a small number of ties and that law firm growth makes it unlikely that these norms will survive); REGAN, supra note 7, at 39 (noting that "sheer size" of modern law firms makes consensus impractical); Suchman, supra note 99, at 857 ("As law firms grow and diversify, informal social structures and face-to-face contacts no longer suffice to bind these organizations together, and a new regime of formal hierarchy, record-keeping, and evaluation has slowly begun to emerge.");
153. see also Paul C. Saunders, When Compensation Creates Culture, 19 GEO. J. LEGAL ETHICS 295, 296-97 (2006) (partner from Cravath, Swaine & Moore, which has a relatively small partnership that relies upon lockstep compensation, opining that the eat-what-you-kill system undermines "collegiality and partnership" and may even create an unethical culture).
154. ALM, Inc., is a media conglomerate that publishes The American Lawyer, the National Law Journal, and several regional and topical publications on the legal profession.
155. For an explanation of metropolitan area coding, see supra note 77.
156. See supra note 81 and accompanying text.
157. We theorized that some practice specialties, particularly those involving the capital markets, tend to be more remunerative and place those lawyers in direct contact with high-level corporate executives. Therefore, they commanded a price premium in the lateral market. Conversely, some practice specialties, such as labor and employment, may be more susceptible to price pressure from in-house counsel, which could generate tensions with partners in firm's marquee practices. See Kirkland, supra note 85, at 672-75 (discussing how tensions arise between practice groups over conflict checks and differing fee structures).
158. joined to eliminate estimation error associated with nonrandom distribution of errors (i.e., heteroskedacity).
159. There is also significant regional variation. Compared with the rest of the sample, lateral movement was associated with large gains in New York, Los Angeles, and San Francisco, and a more modest gain in Washington, D.C. In contrast, in Chicago, there was no price premium associated with lateral movement. This may be the result of the prevalence of two-tier firms in the Chicago market, see Cindy Collins, Anchoring Associates, OF COUNSEL, Nov. 2, 1998, at 17 (referring to Chicago as the "land of two-tier partnerships" because of its early adoption by many of the city's leading firms), and/or a disproportionate number of de-equitizations, which has prompted substantial downstream movement.
160. Note that the sample includes some small firm lawyers who joined a larger firm as the result of a merger or acquisition.
161. See supra notes 7-8 and accompanying text.
162. See, e.g., Press Release, Nat'l Ass'n for Law Placement (NALP), Salaries at Largest Firms Continue to Rise Rapidly, (Sept. 14, 2007), available at http://www.nalp.org/press/details.php?id=71 ("The prevailing salary in the largest firms rose to $145,000 in a number of cities: Boston, Chicago, Los Angeles, the San Francisco Bay and Silicon Valley areas, and Washington, DC. In New York, the prevailing salary was even higher, $160,000.").
163. Weighted average based on the number of equity partners per firm.
164. See Zusha Elinson, Howrey to Ditch Lockstep Compensation for Merit-Based Model, RECORDER, June 29, 2007, http://www.law.com/jsp/ llf/PubArticleLLF.jsp?id=1183107981391.
165. See Posting of David Lat to Above the Law, Skaddenfreude: Dechert DC's FSG Favoritism?, http://www.abovethelaw.com/2007/02/ skaddenfreude_dechert_dcs_fsg.php (Feb. 12, 2007, 22:21 EST).
166. See Kellie Schmidt, McDermott Will to Add Lower-Paid Associates, RECORDER, Nov. 2, 2007, http://www.law.com/jsp/llf/ PubArticleLLF.jsp?id=1193907832842. The article quoted a general counsel on the move: "I think McDermott is on a good mission: 'Let us find a way to the make the cost more reasonable so you'll continue to hire us.'" Id.
167. See Zusha Elinson, Thelen Reid Responds to Associate Raises with a Two-Tier Pay Scale, RECORDER, June 25, 2007, http://www.law.com/jsp/llf/PubArticleLLF.jsp?id=1182762353558. The article also noted that "Fenwick & West went to a similar system when it raised salaries in May, letting associates choose between an 1,800-hour or 1,950-hour pay scale." Id.
168. Lynne Marek, Chicago Firms Asks Associates to Choose Between Pay Levels, NAT'L L.J., Oct. 11, 2007 (reporting that firm declined to discuss specifics for "competitive reasons").
169. See Posting of David Lat to Above the Law, Associate Bonus Watch: Open Thread for Firms That Have Nixed Special Bonuses, http://www.abovethelaw. com/2007/12/associate_bonus_watch_open_thr.php (Dec. 18, 2007, 13:20 EST) ("We've heard complaints from numerous associates claiming that their law firms are using vague bonus policies to lowball them on bonuses.").
170. See Andrew Ross Sorkin, Lawyers Compete, Except in Bonuses, N.Y. TIMES, Dec. 2, 2007, at 8 (reporting how other New York "white-shoe" firms fall in line after Cravath, Swaine & Moore announced associates bonuses of $45,000 to $110,000, depending upon seniority, and commenting that this perennial "copycat mode" is "absolutely irrational, economically speaking").
171. Recent data suggests that graduates of elite law schools strongly gravitate toward more elite firms with higher partners per profits and higher midlevel salaries and bonuses despite longer workweeks and less family-friendly work conditions. See Henderson & Zaring, supra note 58, at 1099 & tbl.3.
172. See, e.g., Stephanie Francis Ward, The Ultimate Time-Money Trade-Off, ABA J., Feb. 2007, at 24. Susan C. Robinson, associate dean for career services at Stanford Law School, is quoted in the article: "The supposed characterization of the millennials is that they are not as willing to compromise life and family for work." Id. at 25.
173. See, e.g., MARY ANN GLENDON, A NATION UNDER LAWYERS ch. 2 (1994) (discussing transformation of large firm practice since 1960s and how emphasis on profitability has marginalized longstanding ideals of the profession); KRONMAN, supra note 95, at 4 (stating that explosive growth of law firms has "created a new, more openly commercial culture in which the lawyer-statesman ideal has only a marginal place"); LINOWITZ, supra note 98, at 31 ("Money is, of course, at the heart of the problem. Law as a profession can carry many burdens, but it cannot carry a code of values that ranks money very high among those virtues.");
174. DEBORAH L. RHODE, IN THE INTERESTS OF JUSTICE: REFORMING THE LEGAL PROFESSION 37 (2000) ("[P]reoccupation with the bottom line has squeezed out other values that are central to a satisfying professional life.").
175. One large law firm partner has made a similar observation. See MICHAEL H. TROTTER, PROFIT AND THE PRACTICE OF LAW xviii(1997) ("[E]fforts to revive the lost and lamented professionalism of the bar are doomed to failure, because the change in lawyers' behavior result from fundamental changes in the economics, structure, and functioning of the profession and changes in the business world to which it relates.").
176. GALANTER & PALAY, supra note 14, at 127-29; Marc Galanter & Thomas Palay, Large Law Firm Misery: It's the Tournament, Not the Money, 52 VAND. L. REV. 953, 967-68 (1999).
177. See supra note 12 and accompanying text.
178. As some commentators have noted, the problems spawned by lawyer mobility are made possible by longstanding ethics rules that forbid noncompete contracts among lawyers. See, e.g., Larry E. Ribstein, Ethical Rules, Agency Costs, and Law Firm Structure, 84 VA. L. REV. 1707, 1730-38 (1998) (discussing background of and rationale for the legal profession's ban on noncompete contracts between lawyers, now codified as Rule 5.6 of the Model Rules of Professional Responsibility, and its deleterious effects on firm loyalty and the creation of firm specific capital).
179. See, e.g., Leslie C. Levin, The Ethical World of Solo and Small Law Firm Practitioners, 41 HOUS. L. REV. 309, 310-12 (2004) (discussing efforts of the corporate lawyers in New York and Chicago, who dominated bar organizations, to use the ethics rules to police business-getting practices of ethnic, urban solo and small firm lawyers who practiced in areas such as personal injury and criminal law).
180. See, e.g., Stephen Daniels & Joanne Martin, "The Impact that It Has Had Is Between People's Ears": Tort Reform, Mass Culture, and Plaintiffs' Lawyers, 50 DEPAUL L. REV. 453, 466-72 (2000) (documenting insurance industry funding of an elaborate public relations campaign since 1970s to shape public opinion on tort reform, often casting the plaintiffs' lawyer as the villain);
181. Marc Galanter, An Oil Strike in Hell: Contemporary Legends about the Civil Justice System, 40 ARIZ. L. REV. 717, 749 (1998) (quoting president of the United States Chamber of Commerce on launch of a campaign against "class action suits and ambulance chasing trial lawyers, who suck billions of dollars out of consumers and companies.").
182. See generally WILLIAM HALTOM & MICHAEL MCCANN, DISTORTING THE LAW: POLITICS, MEDIA, AND THE LITIGATION CRISIS (2004) (marshalling overwhelming evidence that tort cases, litigation rates, and plaintiff success are dramatically exaggerated in the media, thus fomenting support for tort reform).
183. See Levin, supra note 148, at 312-15 (collecting large array of statistics and sources that document higher incidences of complaints and disciplinary action against solo and small firm lawyers and exploring reasons for disparity, including difference in client base, ability to detect unethical behavior, and institutional biases); cf. David B. Wilkins, Who Should Regulate Lawyers?, 105 HARV. L. REV. 801, 822-33 (1992) (analyzing relative effectiveness of other controls (reputations, malpractice) in dealing with under-serving of clients in corporate sector).
184. Lisa G. Lertnan, Blue-Chip Bilking: Regulation of Billing and Expense Fraud by Lawyers, 1999 GEO. J. LEGAL ETHICS 205, 227;
185. see also Magali Sarfatti Larson, On the Nostalgic View of Lawyers' Role: Comment on Kagan and Rosen's "On the Social Significance of Large Firm Practice", 37 STAN. L. REV. 445, 456 (1985) (arguing that professional ethics "have their best anchor and support" in large firms because "they can afford to be ethical" and "one of the main services they sell is legitimation");
186. Amy R. Mashburn, Professionalism as Class Ideology: Civility Codes and Bar Hierarchy, 28 VAL. U. L. REV. 657, 675-77 (1994) (discussing how prestige and power of large law firm practice has become conflated with "moral authority to make judgments about the standards of professional behavior that will bind others" in legal profession and citing studies that correlate large firm practitioners with perceptions of more ethical behavior).
187. See JEROME E. CARLIN, LAWYERS' ETHICS: A SURVEY OF THE NEW YORK CITY BAR 119-32 (1966).
188. Id. at 42-47 (describing construction and content of survey questionnaire). As a preliminary check on the questionnaire's reliability, Carlin's research team asked a group of lawyer-informants to rate ten to twelve colleagues as ethical or unethical. The ethics scenarios were then presented to several dozen of these "rated" lawyers. The questions on the final survey instrument were those in which the lawyer-respondents answers had a reasonable correspondence to the ratings of the lawyer-informants. Id.
189. Id. at 8-9 (discussing how sample was assembled).
190. Some of the behavior more likely to be deemed unethical by large firm lawyers included acceptance of a commission without telling a client, accepting a referral fee, the sending of Christmas cards to clients (then viewed as form of business solicitation), turning a blind eye to a client's bribe of a government official, agreeing to represent one of two partners he previously represented after a business controversy develops, or disregarding an oral contract with another lawyer on a real estate transaction. Id. at 51-57 & tbls.32-36.
191. Id. at 119-24.
192. Id. at 122. Moreover, Carlin found that the different ethical outlooks and behavior of lawyers from different religious and ethnic backgrounds were entirely a function of being channeled into specific legal contexts and practice settings. Id. at 124.
193. GALANTER & PALAY, supra note 14, 32-34 (citing Nat'l Indus. Conference Bd., Organization of Legal Work, 16 CONF. BD. BUS. REC. 463, 464 (1959)).
194. PAUL HOFFMAN, LIONS IN THE STREET: THE INSIDE STORY OF THE GREAT WALL STREET LAW FIRMS 76 (1973) ("[I]t's virtually impossible for a bank - even if it chose - to switch to another firm.").
195. Id. at 72.
196. CARLIN, supra note 152, at 66-67.
197. John M. Conley & Scott Baker, Fall From Grace or Business as Usual? A Retrospective Look at Lawyers on Wall Street and Main Street, 30 LAW & SOC. INQUIRY 783, 791 (2005) (applying this characterization to the narrative of REGAN, supra note 7); cf. REGAN, supra note 7, at 36 (discussing the "perpetual instability" experienced by modern day large firm lawyers); TROTTER, supra note 144, at 194 ("The number one problem faced by major business practice firm lawyers today is the increased uncertainty about what the future holds . . . .").
198. See Kirkland, supra note 85.
199. Id. at 675.
200. Id. at 676. Kirkland quotes a former managing partner, "Today, a lawyer needs to build skills. Yesterday, a lawyer needed to build a practice. A lawyer today is more of a hired gun, less the owner of a small business." Id.
201. Id. at 669.
202. Id. at 678. Kirkland later quotes another large firm lawyer: "The whole system is self-interest driven, but no one talks about it this way. Everyone talks about it as an altruistic system or talks about it in a communal sense. But so much of what partners are doing is being done to promote their own value." Id. at 702.
203. Id. at 672 ("When a conflict cannot be waived . . . decisions about which client to take and which to turn away are made at the highest levels of firm management.").
204. Id. at 675 (reporting that a partner squeezed by higher billing rates must either find new clients or move to another firm that charges lower rates).
205. Id. at 678. Kirkland quoted one equity partner: "[The firm needs to] cut out the dogs. Get rid of the partner whose practice has died. Every two or three years [the firm needs to] look closely and make the hard decisions - look at production versus salary. Nip the thing in the bud and de-equitize the couch potatoes." Id.
206. Id. at 690.
207. See, e.g., Ronald J. Gilson, The Devolution of the Legal Profession: A Demand-Side Perspective, 49 MD. L. REV. 869, 916 (1990) ("[A] necessary condition for professionalism is market power."); Regan, supra note 119, at 4 ("[S]ome respite from market demands is a necessary, but not sufficient, condition for fostering noneconomic values.").
208. SMIGEL, supra note 31, at 343.
209. Id.
210. Some commentators have expressed doubt. See, e.g., HEINZ & LAUMANN, supra note 44, at 365-73 (observing in a large-scale empirical study of Chicago lawyers during mid-1970s that corporate lawyers had less autonomy than their small firm counterparts).
211. See, e.g., GALANTER & PALAY, supra note 14, at 50 (reviewing evidence that routine legal work is now done increasingly by in-house lawyers while the relationship with outside counsel has been less exclusive and based on "more task-specific ad hoc arrangements"); GLENDON, supra note 143, at 83-84 ("[In emerging legal ethos, a] lawyer who takes his duties to the court and the legal system seriously will often be at a disadvantage against a less scrupulous adversary. . . . [G]ood ethics may not make for good business."); LINOWITZ, supra note 98, at 111 ("If current trends continue, the corporate counsel's job increasingly is going to be the purchase of legal services from what management considers more or less a commodity market of large law firms"); RHODE, supra note 143, at 9 (discussing erosion of longstanding and stable client relations, thus making it "risky for counsel to protest unreasonable demands or to deliver unwelcome messages about what legal rules or legal ethics require"); TROTTER, supra note 144, at 195 (large firm partner reporting on persistent "danger that the client will hire an ambitious counsel who will want to take more work in-house or to put your part of the company's business up for competitive bidding.").
212. See NELSON, supra note 17, at 271-72 (concluding at the end of a case study of four large Chicago law firms that retention of clients demands that lawyers "present themselves as zealous advocates"); Robert W. Gordon, The Ethical Worlds of Large-Firm Litigators: Preliminary Observations, 67 FORDHAM L. REV. 709, 728 (1998) (acknowledging, by researcher in American Bar Foundation's Ethics: Beyond the Bar Study, the primacy of zealous advocacy); Kirkland, supra note 85, at 718 (concluding, based on her own field work, that partners have strong incentives "not to act as autonomous counselors who serve as a check on their clients' desires, but as agents of their clients"); Suchman, supra note 99, at 854 (concluding, by researcher in American Bar Foundation's Ethics: Beyond the Bar Study after extensive interviews with large firm litigators, that zealous advocacy was viewed as "an affirmative moral obligation, even when it came into conflict with other ethical rules."); see also GLENDON, supra note 6, at 38 ("The traditional ideal of lawyers that has flourished most in the new atmosphere is client loyalty with its concomitant duty of zealous representation.").
213. See Gilson, supra note 172, at 913-15 (applying economic analysis to market for corporate legal service and concluding that the "best (and only) candidate for the next generation of private gatekeeper" is the inside lawyer).
214. See Robert L. Nelson & Laura Beth Nielsen, Cops, Counsel, and Entrepreneurs: Constructing the Role of Inside Counsel in Large Corporations, 34 LAW & SOC'Y REV. 457, 487 (2000) (concluding that in-house lawyers have "attempted to craft a new image within the corporation in which lawyers are team players, rather than cops.").
215. Id. at 490; see also LINOWITZ, supra note 98, at 84 ("Increasingly . . . CEOs want their general counsel to have the same exclusive loyalty to the company that they expect from employees who do not have professional responsibilities.").
216. Gary F. Torrell, How to Work with In-House Counsel, AM. LAW., July-Aug. 1992, at 32.
217. LINOWITZ, supra note 98, at 83 (opining how clients had changed during his sixty year career). Similarly, Mary Ann Glendon observes, "[m]ost lawyers these days are perfectly decent people who feel like they're trapped in a system that they don't really like, but a system that they don't feel safe trying to buck." According to Glendon, the new rules are simple: "[k]eep your head down, don't ask questions and bill as much as you can." David Segal, In the Business of Billing? Lawyers Say a Rush for Money Is Shaking Profession's Standards, WASH. POST, Mar. 22, 1998, at H1 (quoting Glendon).
218. MATTHEW PARSON, EFFECTIVE KNOWLEDGE MANAGEMENT FOR LAW FIRMS 4 (2004) (quoting chairman of an international law firm).
219. See HILLMAN, supra note 86, § 2.3.4 (reviewing formal strictures and case law on agreements discouraging lawyer competition); Ribstein, supra note 147, at 1731 & nn. 108-11 (discussing bar on agreement not to compete and collecting cases).
220. See supra note 123 and accompanying text.
221. See David B. Wilkins & G. Mini Gulati, Why Are There So Few Black Lawyers in Corporate Law Firms? An Institutional Analysis, 84 CAL. L. REV. 493, 541 (1996) (attributing the analogy to Ian Ayres).
222. See Wilkins & Gulati, supra note 14, at 1641-57.
223. Id. at 1643 ("Since training work involves a substantial investment of valuable partner time, firms only want to give this work to associates who are likely to have long-term careers with the firm . . . .").
224. Drawing upon her qualitative research in ten large law firms, Kimberley Kirkland aptly describes the dilemma: Although a powerful practice group leader may limit the autonomy of many lawyers within the group, profitable partners may be able to purchase a degree of autonomy that others in the group cannot. For instance, while a firm may officially require all partners to prepare a business plan, a practice group leader may ignore the requirement for a very profitable partner, or a highly profitable partner may be able to charge a client a lower hourly rate than other partners would be permitted to charge for a new matter. Lawyers at the highest levels of management identify one of the central tensions in large firms today as whether management is able to control decisions in the areas outlined above, i.e., whether management can decline to follow the wishes of a significant partner and still maintain power. Kirkland, supra note 85, at 673.
225. See id. at 680, 682, 691 (observing that "lawyers who work for other lawyers must understand that their supervisors are their primary 'clients'", that superiors "expect the lawyers who work for them to be responsive to clients needs '24/7,'" and that lack of accurate information reinforces the tendency among lawyers to "rely on perceptions [based on paper credentials and limited interactions] to make judgments about one another").
226. ELIZABETH CHAMBLISS, MILES TO GO: PROGRESS OF MINORITIES IN THE LEGAL PROFESSION 79 (2004) (quoting "a senior partner at a top law firm").
227. JANET E. GANS EPNER, VISIBLE INVISIBILITY: WOMEN OF COLOR IN LAW FIRMS 12-13 (2006); see also Wilkins & Gulati, supra note 14, at 566 ("Although managing partners understandably continue to deny that firms track incoming associates, more detached observers, as well as partners in more candid moments, report the contrary." (footnotes omitted)).
228. See Richard H. Sander, The Racial Paradox of the Corporate Law Firm, 84 N.C. L. REV. 1755, 1796-98 & tbl.16 (2006) (differences significant at the p < 0.05 level).
229. Id. tbl.17 (differences significant at the p < 0.05 level).
230. Id. tbl.18 (differences significant at the p < 0.05 level).
231. Id. tbl.19 (differences significant at the p < 0.05 level).
232. Id. tbls.19 & 20 (differences significant at the p < 0.05 level).
233. Id. at 1758-59 (reporting empirical evidence that minority candidates receive hiring preferences in large firms but "their opportunities to learn and perform once inside the firm are, in some ways, distinctly inferior"). Sander's "Racial Paradox" analysis has attracted a lot of criticism, primarily because of Sander's hypothesis that the disparate work assignments and mentoring between blacks and white is rooted in a skills deficit that arises in law school due to a mismatch of credentials. See, e.g., James E. Coleman, Jr. & Mitu Gulati, A Response to Professor Sander: Is It Really All About the Grades?, 84 N.C. L. REV. 1823, 1824-27 (2006) (praising Sander for "document[ing] how the experiences of black associates - in terms of key developmental factors such as mentorship, quality of assignments, and training - are perceived by them to be systematically worse than those of their white colleagues" but strongly disputing his conclusion, triangulated from multiple datasets, that these dynamics are driven by lower ability as allegedly measured by law school grades). Our analysis, however, does not depend upon this interpretation. Rather, the mere perception of lower ability based on stereotype is enough to reduce the flow of coveted work assignments and training opportunities. See, e.g., Wilkins & Gulati, supra note 14, at 569-70 ("[T]he decision about who is a superstar worthy of training will be made as an initial matter in the same way as it is done at the recruiting stage - based on a few easily observable signals such as law school status, academic honors, and grades. . . . Under these circumstances, background prejudices and preconceptions can lead white partners to believe that black associates are more likely to be average or perhaps even unacceptable.").
234. EPNER, supra note 192, at 12-13 & tbl.1.
235. Id. at 12.
236. Id. at 21. As a group, however, white and minority woman both fared worse than their male counterparts. Id.
237. D.M. Osborne, Diversity of Opinion, MINORITY L.J., Nov. 1, 2006, http://www.law.com/jsp/law/PubArticlePrinterFriendly.jsp?id=
238. See D.M. Osborne, Why Are Minority Female Associates Leaving Law Firms?, MINORITY L.J., Nov. 7, 2007, http://www.law.com/jsp/ article.jsp?id=1194343441401.
239. See, e.g., Karen Asner, Best Practices in Implementing Law Firm Diversity Programs, N.J. L.J., Apr. 30, 2007, at 32 ("Professional development staff . . . can monitor the work assignments of associates, ensuring that work is evenly distributed and that career-making opportunities are afforded to a diverse group of associates.");
240. Joseph W. Hatchett & Danielle T. Shannon, Firms That Don't Recognize the Value of a Diverse Workplace Will Lose Attorneys and Clients, BROWARD DAILY BUS. REV., June 4, 2007, at 14 (advising firms that want to retain minority associates to "[e]stablish a formal mentoring program," "[p]rovide professional skills development," and "[r]eview work assignments and hours billed to ensure that minority attorneys are not being excluded from key client matters");
241. Edgardo Ramos & Lynn Anne Baronas, What Works: Ways to Increase Diversity at Law Firms, NAT'L L. J., Jan. 16, 2006, at 13 (encouraging development of firm mentorship programs to monitor minority associates' hours and ensure professional growth through quality work assignments);
242. Karen Jackson Vaughn & Cynthia R. White, Winning the War for Talent, LEGAL INTELLIGENCER, Aug. 24, 2007, at 7 (advising firms seeking to retain minority associates to "provid[e] equal access to quality work assignments" and training in "business development, leadership development and presentation skills").
243. See, e.g., Leigh Jones, Law Firms Digging Deeper on Campus, NAT'L L.J., Dec. 15, 2005, at 1. The article reported that, in response to client demands, "most big law firms have boosted their efforts to diversify" and cited the example of Philadelphia-based Duane Morris, which acknowledged, "We target four or five schools with strong minority enrollments." Id.
244. See, e.g., Fortney, supra note 116, at 281-82 (reporting on economic pressures that cause partners to avoid "adequate mentoring, supervision, and communication" with associates); Green, supra note 116, at 14 (reporting consensus among large-firm practitioners that "high-quality-on-the-job training is on the wane" and citing pressure to bill, client expectations for rapid response time, and pressure to keep costs down); Wilkins & Gulati, supra note 186, at 538 ("[P]artners will have a preference for associates who need little or no training.").
245. At least one West Coast firm has linked partner compensation to diversity goals. See Jessie Seyfer, Color of Money: Diversity Isn't Just a Just a Slogan at Fenwick, It's Partner Pay Dirt, RECORDER, Dec. 5, 2006, at 1 (reporting that Fenwick & West "closely ties diversity goals to partners' compensation" by asking associates to evaluate partners on diversity efforts). One of the hazards of this approach is that partners can, in effect, pay a higher "tax" to avoid these responsibilities; and if the tax becomes excessive, they can leave. Cf. Wilkins & Gulati, supra note 7, at 538 ("Associate training is both a public good for the firm and a private good for individual partners.").
246. There is also pressure for law firms to diversify in order to attract and retain lucrative clients. See, e.g., David B. Wilkins, From "Separate Is Inherently Unequal" to "Diversity Is Good for Business": The Rise of Market-Based Diversity Arguments and the Fate of the Black Corporate Bar, 117 HARV. L. REV. 1548, 1557 (2004) ("[T]he 'business case' for diversity in the large law firms that seek to serve [Fortune 500] corporate clients appears compelling indeed."). Yet, in his interviews with large law firm partners, which covered the topic of client pressure to hire a more diverse workforce, John Conley observed that most firms appeared to mollify clients that they are doing their best in recruitment and that no large firm rivals are doing measurably better. Moreover, the partners pointed out that clients had strong incentives not to trade down in firm quality.
247. John M. Conley, Tales of Diversity: Lawyers' Narratives of Racial Equity in Private Firms, 31 LAW & SOC. INQUIRY 831, 851 (2006) (citing informants' belief that perceived quality and prestige, often signaled through high billing rates, bound clients to the firm).
248. See, e.g., EPNER, supra note 192, at 21 (reporting that among women, 44% of the minority lawyers and 39% of the white lawyers reported unequal distribution of work assignments, compared to 25% of the minority men lawyers and 2% of the white lawyers).
249. See, e.g., John P. Heinz, Kathleen E. Hull & Ava A. Harter, Lawyers and Their Discontents: Findings from a Survey of the Chicago Bar, 74 IND. L.J. 735, 748-49 (1999) (in study of the Chicago bar, finding that women lawyers are much more likely to report that personal or family obligations have affected their career choices or work opportunities);
250. Deborah L. Rhode, Gender and the Profession: The No-Problem Problem, 30 HOFSTRA L. REV. 1001, 1007 (2002) ("[Because of] substantial family commitments . . . many female attorneys . . . are not given enough challenging, high visibility assignments, nor are they included in social events that yield professional opportunities.").
251. Kenneth G. Dau-Schmidt et al., "The Pride of Indiana": An Empirical Study of the Law School Experience and Careers of Indiana University School of Law - Bloomington Alumni, 81 IND. L.J. 1427, 1448-51 & tbls.9 & 10 (2006).
252. Id. (delineating graduates by the proportion of spouses with "intense jobs").
253. Id. at 1451.
254. See Kenneth G. Dau-Schmidt et al., Gender and the Legal Profession: The Michigan Alumni Data Set 1967-2000, at 19-20 tbls.D1(5) & D1(15), 24-25 tbls.E1(5) & E2(15) (Sept. 27, 2007) (unpublished manuscript), available at http://ssrn.com/abstract=1017362.
255. See id. at 22, 24-25 tbls.E1(5) & E2(15), graphs 7 & 8.
256. See id.
257. See id. at 26 & graph 9.
258. Id. at 74.
259. Id. at 75.
260. Kirkland, supra note 85, at 680.
261. Id. at 683.
262. Id. at 685.
263. Green, supra note 116, at 20 n.55 (quoting Kenneth Standard of Esptein, Becker & Green P.C.).
264. Amelia J. Uelmen, The Evils of "Elasticity": Reflections on the Rhetoric of Professionalism and the Part-Time Paradox in Large Firm Practice, 33 FORDHAM URB. L.J. 81, 83 (2005).
265. Id.
266. The commentary that suggests that "firms" adopt more humane policy is simply too voluminous to cite. In just one example, Deborah Rhode suggests that firms adopt "reasonable billing standards that can accommodate significant family, pro bono service, and other personal commitments," "broad[en] eligibility for alternative schedules, including reduced time, flexible hours, compressed workweeks, and telecommuting," and create "monitoring structures designed to minimize the risks associated with alternative schedules, such as poor quality work assignments, lack of promotion opportunities, and workloads routinely exceeding agreed limits." Deborah Rhode, Profits and Professionalism, 33 FORDHAM URB. L.J. 49, 75 (2005).
267. See, e.g., Press Release, NALP, Few Lawyers Work Part-Time, Most Who Do Are Women (Dec. 5, 2007) (reporting that 98% of all law firm employers permit part-time employment, though only 5.4% actually use it).
268. See supra notes 90-92 and accompanying text (presenting multivariate regression results in which communication toward partnership and larger non-equity tier were factors reducing the likelihood of midlevel associate departure).
269. See, e.g., Dau-Schmidt et al., supra note 213, at 22 (showing that average hours worked per year for Michigan Law graduates five years out has increased 143 hours per year for men and 88 hours per year for women).
270. See, e.g., Fortney, supra note 116, at 283-84 (collecting sources that suggest higher associate turnover in recent years, primarily due to higher work demands).
271. See, e.g., Fox, supra note 7, at 246-47 ("[T]he profession is undoubtedly being collectively embarrassed by the fact that the career path to 'partnership' today provides neither a path nor anything that resembles real partnership."); Green, supra note 116, at 24 ("[B]ecoming a partner has lost some of its allure."); Rhode, supra note 225, at 72 ("Particularly in large firms . . . full equity partnership[] typically promises no reprieve from the punishing schedules that preceded it.").
272. See, e.g., Marci Krufka, The Young & the Restless, LAW PRACTICE, July/Aug. 2004, at 48 ("Many partners . . . are unsure about - even frustrated by - the new brand of associates.");
273. Kathleen J. Wu, Spoiled or Special, The Over-scheduled, Over-praised Generation Goes to Work at the Firm, TEX. LAW., May 22, 2006, at 25 ("[E]xperts in the human resources field [believe that Millennials are] not so keen on dues-paying and menial tasks - the kind that all associates, at least occasionally, are called upon to perform." );
274. Lynne C. Lancaster, A Snapshot of Generations in the Workplace Today, 1 COMPLETE LAW. (2005), http://www. thecompletelawyer.com/volume1/issue3/article.php?artid=21 (defining Millennials as those born after 1982 and discussing generational characteristics often at odds with modern large law firms, such as desire for more feedback, schedule flexibility, and additional training).
275. Krufka, supra note 231, at 49 (defining generational categories).
276. Id.
277. See supra note 142.
278. See Tricia Kasting, The "Millennial" Law Student Generation, N.J. L.J., Oct. 9, 2006, at 21 (suggesting that these impressions are rooted in mass media). At a forum of law firm managers, law firm consultant Bruce MacEwen chronicled how many law firm partners perceive Millennials: "The new generation of lawyers (Millenials, a/k/a Gen Y) are all about 'work/life balance,' or trying to have it all."; they "want constant feedback, a highly structured environment (not 'sink or swim') and are intolerant of drudgery"; "[t]hey have far less focus on a long-term career commitment to the firm"; "[b]ut are at least as smart, and far more worldly (study abroad, living abroad, etc.) than previous generations." Adam Smith, Esq., http://www.bmacewen.com/blog (Mar. 15, 2007, 08:34 EST).
279. Krufka, supra note 231, at 48-49 ("These children of the baby boomers have been raised to think independently and to express their beliefs openly. To an older generation of partners, this might be perceived as discourteous or disrespectful.").
280. See supra notes 4-6 and accompanying text.
281. For some historical perspective on similar demands made on corporate law firms by students of the late 1960s and early 1970s, see Nader, supra note 22, at 497-500.
282. See Law Students Building a Better Legal Profession, http://refirmation.wordpress.com; see also McQuilken, supra note 21 (discussing the origins of BBLP at Stanford Law and its goals).
283. See Law Students Building a Better Legal Profession, Our Rankings, http://refirmation.wordpress.com/our-rankings
284. The "About Us" webpage for BBLP reads: building a better legal profession is a national grassroots movement that seeks market-based workplace reforms in large private law firms, by publicizing firms' self-reported data on billable hours, pro bono participation, and demographic diversity, we draw attention to the differences between these employers, we encourage those choosing between firms - students deciding who to work for after graduation, corporate clients deciding who to hire, and universities deciding who to allow on campus for interviews - to exercise their market power and engage only with the firms that demonstrate a genuine commitment to these issues. Law Students Building a Better Legal Profession, About Us, http://refirmation.wordpress.com/ about-us.
285. See G.M. Fillsko, Students Aim for BigLaw Change, ABA J., Dec. 2007, http://www.abajournal.com/magazine/students_aim_for_biglaw_change.
286. See id. (reporting that after meeting with BBLP founders, Orrick, Herrington & Sutcliffe agreed to become a founding member of the Project for Attorney Retention at U.C. Hastings College of the Law).
287. The group's extensive media coverage, which includes the New Republic, the Wall Street Journal, and the L.A. Times, is collected at Law Students Building a Better Legal Profession, Recent Press, http://refirmation.wordpress.com/recent-press.
288. According to a memorandum written by one of BBLP's founders to William Henderson, the group's total page views jumped by over 70,000 during the prime of the fall recruiting season. See Memorandum from Andrew Canter to William Henderson 2 (Feb. 14, 2008) (on file with author).
289. Id. at 2.
290. See Principles for a Renewed Legal Profession, Law Students Building a Better Legal Profession, http://refirmation.wordpress.com/principles- for-a-renewed-legal-profession. This proposed policy mirrors a recent ABA Journal survey of law firm associates. Among 2377 respondents, 73.4% reported practicing law five or fewer years, a figure which suggests that Millennials comprise a large proportion of the total sample. The survey found that associates were dissatisfied with their long work weeks. 84.2% indicated that they would be willing to exchange lower pay for lower billable hour requirements. Moreover, the size of the reduction sought was relatively substantial: 59.7% favored a drop of at least 15%. The majority of respondents also reported that they would take a pay cut commensurate with their workload reduction. Ward, supra note 142, at 24-25.
291. Some commentators, including BBLP, have argued that associates with balanced lives produce a better work product. See Rhode, supra note 225, at 68 (reviewing management literature and concluding that "balanced lives boost bottom lines"); Costs to the Profession, Law Students Building a Better Legal Profession, http://refirmation.wordpress.com/ costs-to-the-profession (describing how long hours stifle creativity and promote inefficient work habits).
292. See, e.g., supra notes 219-23, and accompanying text; Fox, supra note 7, at 248 ("[T]he future model of the law firm . . . [based on] a now inevitable path is that law firms will include as partner only those whose books of business exceed a very significant number - say a million, two million, or three, depending on the firm and the city."); Green, supra note 116, at 20 n. 5 5 (quoting a law firm partner, "You can either practice a hundred percent or you can stop practicing. It is very hard to practice part-time"); Kirkland, supra note 85, at 683 (quoting one equity partner, "[T]he hours don't get any better for partners; partners have even more pressure than associates do.").
293. Henderson & Zaring, supra note 58, at 1099 & tbl.3 (presenting data that graduates of Top 10 law school are much more likely choose a Top 10 firm, with higher pay and prestige, despite significantly longer hours, less family-friendly working conditions, or worse communication toward partnership).
294. See William D. Henderson, Presentation at the 2006 Law & Society Annual Meeting, (July 8, 2006) (presenting statistical evidence of a strong negative relationship between hours, family friendliness, and a variety of desirable working conditions versus firm profits and location in a major market).
295. See supra Figure 8 (showing that ratio of associate to partner pay at firms at the 95th percentile of profitability was 13.9 to 1); see also Aaron S. Haas, The Rationality of Law Students' Career Choices (Harvard Law School Students Scholarship Series, Paper 8, 2006) (applying recent behavioral economics theories to explain why elite law school students eventually end up favoring large firm jobs over other options despite a sense that they will be unhappy with the choice).
296. For a persuasive economic analysis of the collective action problems that plague law firm associates, see Renee M. Landers, James B. Rebitzer & Lowell J. Taylor, Rat Race Redux: Adverse Selection in the Determination of Work Hours in Law Firms, 86 AM. ECON. REV. 329 (1996).
297. See supra Figure 8.
298. Green, supra note 116, at 22 (quoting Stephen Crane, partner at Proskauer Rose LLP and past president of the New York State Bar Association).
299. See supra Part II.D.
300. See supra notes 134-39, and accompanying text.
301. See supra note 7 and accompanying text.
302. See Ronit Dinovitzer & Bryant G. Garth, Lawyer Satisfaction in the Process of Structuring Legal Careers, 41 LAW & SOC'Y REV. 1, 12-13 & fig.2 (2007).
303. See id. at 23 ("[F]or many of the graduates of lower-tier law schools, gaining entry to the legal profession is part of the project of upward mobility.").
304. Ward Bower, The War for Talent and Starting Salaries, REP. TO LEGAL MGMT. (Airman Weil, Inc., Newton Square, Pa.), Apr. 2007, at 2, available at http://www.altmanweil.com/dir_docs/ resource/aa26ed0a-08e1-422b-8605-6e42e944bb92_document.pdf. Researchers who studied engineers at the world famous Bell Labs during the 1980s also discovered that the organization's most valuable engineers did not have higher measures of cognitive or social ability, but that several work habits (including intellectual humility) consistently produced the best results for the company.
305. See Robert Kelley & Janet Caplan, How Bell Labs Creates Star Performers, HARV. BUS. REV., July-Aug. 1993, at 128.
306. General counsel from elite Fortune 100 corporations are indeed aggressively looking for value propositions that are outside the traditional law firm business model. See, e.g., Posting of John Earnhardt to The Platform: The Official Cisco Blog, http://blogs.cisco.com/news (Jan. 25, 2007, 14:13 PST).
307. See, e.g., Dau-Schmidt et al., supra note 210, at 34 (analyzing lawyer satisfaction data for Indiana Law alumni and noting that corporate counsel positions may provide good income, job satisfaction, and work/life balance).
308. Corporate clients are definitely interested in high-quality legal services at a predictable price. See, e.g., Debra Cassen Weiss, Clients May Help End Billing by the Hour, ABA J., Jan. 2, 2007, http://www.abajournal.com/news/clients_may_help_end_billable_hours.
309. Cf. Kelley & Caplan, supra note 261, at 137 (discussing how women and minorities posted largest productivity gains as a result of training based on the work habits of the Bell Lab's most productive workers).
310. See supra Part III.B.
311. For a thought-provoking exchange on these developments by three veteran law firm observers, see Milton Regan, Larry Ribstein & Bruce MacEwan, Law Firms, Ethics, and Equity Capital: A Conversation, 21 GEO. J. LEGAL ETHICS 61 (2008), available at http://ssrn.com/abstract=985351.
312. See supra note 27.