Some law firms will die without quick cuts, consultant says

[DGUtley]

Some law firms will die without quick cuts, consultant says -- Which ones acted this week?
I previously reported about BigLaw cuts: http://thepoliticalforums.com/thread...ly-experts-say
On Thursday, it was discussed that firms should aggressively cut salaries or risk going under. Some law firms will die without quick cuts, consultant says; which ones acted this past week? At least a dozen more large and midsized law firms cut pay and furloughed employees in the past week because of the novel coronavirus pandemic. But it’s not nearly enough, according to a former BigLaw lawyer who once worked as a consultant. “The consensus estimate for 2020 revenue is a decline of 15% to 20% from last year,” Simons wrote. “And yet, as of April 26, less than a quarter of the Am Law 200 have reduced salaries or laid off personnel. This feels like a sluggish response given what the partner profit implications might be.” Simons looked at how such a revenue decline would affect profit margins at the nation’s 200 top grossing law firms. Last year, 126 of those law firms had profit margins of 40% or below. Yet no cuts had been reported at 81 of those 126 law firms as of April 26.

The lists of cuts in the article are staggering.

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[FindersKeepers]

I'm kind of surprised that a good number of companies are not healthy enough to survive for at least a couple of months. I'm even more surprised that law firms are having difficulty, because I would think they could still be bringing in money. I've been recruited to run a publicity campaign for a group of individuals (five of them) who were just sued for 35 million (a ridiculous amount) but the case was filed electronically just a couple of weeks ago. The two attorney firms who represent the five people are still working (from home, perhaps) and asking for more money almost constantly.

Court dates have been pushed back, but money is still rolling in -- albeit probably less than before. But, then I compare that to my niece who had to completely close her yoga studio. At least attorneys can work remotely.

What am I missing?

[Dr. Who]

I'm kind of surprised that a good number of companies are not healthy enough to survive for at least a couple of months. I'm even more surprised that law firms are having difficulty, because I would think they could still be bringing in money. I've been recruited to run a publicity campaign for a group of individuals (five of them) who were just sued for 35 million (a ridiculous amount) but the case was filed electronically just a couple of weeks ago. The two attorney firms who represent the five people are still working (from home, perhaps) and asking for more money almost constantly.

Court dates have been pushed back, but money is still rolling in -- albeit probably less than before. But, then I compare that to my niece who had to completely close her yoga studio. At least attorneys can work remotely.

What am I missing?

Many of the clients are unable to pay their legal fees because their businesses are closed or sources of income have dried up. Personal injury firms in particular may be seeing far fewer new cases, given the dearth of car accidents. In cases where prescription is not an immediate issue, many are probably waiting for the pandemic to pass before launching actions. I also imagine mediations are not taking place on a regular basis because not everyone is set up for video conferencing. All jury trials have been continued, so the big dollar fees from trial work is also not coming in, however non-jury trials may be proceeding via video depending on the state. The class action firms are busy however!

[Perianne]

Early on, when all this was just firing up, it occurred to me that I probably should get a last will and testament made. I contacted a Jew law firm on their website. It was over four weeks before anyone got back with me. To heck with them.

[carolina73]

I just got our notification of the deposit for PPP. Otherwise we were out of money in June.