by John Henry
Posted 6/8/2009 12:00 am
Updated 12 months ago
Arkansas law firms haven't experienced the level of economic pressure felt by some of the nation's larger firms, but that doesn't mean they're immune to the effects of the recession. Coping has involved mostly subtle changes.
Pay cuts and layoffs have hit many of the larger firms around the country, but that hasn't happened here, and lawyers interviewed by Arkansas Business don't expect to see such measures.
"We're not seeing here what's happening nationally," said Harry Hamlin, managing partner at Mitchell Williams Selig Gates & Woodyard PLLC of Little Rock.
Many of those firms, he said, had hundreds of lawyers and were heavily involved in mortgages, real estate transactions, mergers and private equity deals.
"We're fortunate here in Arkansas. We don't have any monster clients that we're dependent upon," he said. "We represent a lot of different industries."
But Hamlin said the firm had kept costs under control and some sections, such as those involved with bankruptcies and foreclosures, had been busy, while those lawyers who deal with bonds had seen less work.
Steve Joiner, managing partner at the Rose Law Firm of Little Rock, said he had noticed a discernible shift - a downturn - from transactional work to litigation, foreclosures and bankruptcies. The transactional side involved mergers and acquisitions. "There just aren't a lot of deals right now," Joiner said. Other than that, however, business is normal at the firm, he said.
Kutak Rock LLP of Omaha, Neb., the fourth-largest firm in the state, has been lucky this year, said Gordon M. Wilbourn, a partner who has management responsibility for the firm's two offices in Arkansas. The firm has grown steadily and this year has added more lawyers - four - than any other firm on Arkansas Business' list of largest law firms, bringing its total to 43 attorneys in Little Rock and Fayetteville.
"We've had more corporate work than we expected," Wilbourn said. "It was kind of surprising. I think a lot of companies looking to reduce fees paid to the big national firms turned to some of the smaller regional firms."
Wilbourn did say the firm was keeping a closer watch on expenses but hadn't laid off anyone and didn't expect to.
Byron Eiseman, managing partner for Friday Eldredge Clark LLP of Little Rock, said he was trying to keep the firm as efficient as possible in its operations. The firm, the largest in the state, hired three new lawyers during the past year, he said, and there have been no layoffs.
Most of the layoffs that have generated news across the nation, he said, have occurred in those large firms involved in private equity and Wall Street activity. "We have been fortunate, blessed," Eiseman said.
He has seen an uptick in the areas of bankruptcy and creditors' rights. "Hopefully, the economy will turn around soon," he said.
Nationwide, some law firms, especially the larger ones, have been offering flat-fee payment plans in a bid to better manage their budgets, but that's not the case in Arkansas.
The normal practice of billing by the hour still rules, although there are certain sectors in which flat fees traditionally have been charged, such as bond work, Wilbourn said.
Joiner said his firm deals in a lot of very complicated high-end work, making it next to impossible to charge a flat fee because the time involved in the case cannot be predicted. Some litigation can go on for a long time. "It's risky for both the client and the law firm," Joiner said of such cases.
"Clients are more cost conscious than in the past," Eiseman said. He sees more creative payment approaches ahead as clients simply cannot justify some of the high-dollar rates, citing a New York firm that passed the $1,000-an-hour barrier in 2007.
Friday Eldredge & Clark remains the largest law firm in the state with 94 lawyers. That's down from 95 the previous year, but no other firm is even within striking distance of overtaking it.
The Mitchell Williams firm remains second with 68 attorneys in Arkansas, one more than it had last year. The firm also has six lawyers in Austin, Texas, and another in New York for a total of 75.
Wright Lindsey & Jennings LLP of Little Rock continues in the No. 3 position with 58 lawyers, one fewer than the year before.
The Rose firm and Quattlebaum Grooms Tull & Burrow PLLC of Little Rock tied for fifth place on the list with 32 lawyers.