CONTENTS People’s hero makes the case for class actions ...Ambush, or guerilla marketing is any...

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Lawyers look out for ambush marketing 2 IBA Quiz 2 Delegates warned of wireless dangers 3 The House of Blues 4 The challenge of leadership 6 Chicago Symphony Orchestra 7 Age of enforcement 8 Today’s schedule 10 Law firm networks 12 A privileged position 14 Clients’ tips on getting hired 15 The new age of private equity 15 CONTENTS Chicago Conference 2006 Wednesday, September 20 Sponsored by Published by “J ohn Travolta made more money playing me than I ever made,” joked Jan Schlichtmann talking about the Woburn toxic tort litigation in a session yesterday. Schlichtmann, a high profile plaintiff lawyer as well as the subject of feature film A Civil Action, joined other litigators including Melvyn Weiss, the so- called king of class actions, in a ses- sion on whether these cases are “necessary… evil… or a necessary evil”. The debate comes at a time when class action litigation is stretching outside the US, explained speakers. Schlichtmann spoke first to defend the use of class actions. “The financial benefits of bringing cases and the social good that comes from them are mutually compatible,” he said. “That’s the beauty of capitalism.” He did acknowledge, though, the need for plaintiff lawyers to improve their public image and “answer the claim that this is all about lawyers and not about clients or justice”. Class actions can have benefits even when you lose, said Schlichtmann. In the Woburn case, for example, it was his team rather than a government body or corporate that first brought together the neces- sary scientists to discuss the possible effects of industrial toxins that had been leaked into the town’s local water supply. “Class actions are not about fight- ing power,” he concluded. “They are not about revenge. They are not about abusing power. They are not about any of those things. They are about civilizing power and we civi- lize power through the law.” Weiss, of Milberg Weiss in New York, argued in his address that fewer class actions are frivolous than are presented as such by the media, while emphasizing the costs that firms take on when pursuing actions. Seventeen years after the Exxon Valdez scandal his clients are yet to receive any payment despite winning a $6 billion jury verdict, he told dele- gates. The firm itself spent millions in billable time on that case. Looking ahead to afternoon ses- sions in which the trend towards class action-type legislation in Europe and elsewhere was discussed, Weiss said “there is not a society in the world that doesn’t need class actions”. Responding to the case put by Weiss and Schlichtmann, Robert Giuffra of Sullivan & Cromwell opened after coffee by joking that he felt inclined to stand and cheer dur- ing their session. “It’s amazing that you can have justice without class actions,” he added wryly. But the picture of class actions painted by his colleagues in the morning was far from complete, he said. In fact, argued Giuffra, the “cowboy justice” that is made possi- ble by class action legislation leads to an increase in the cost of capital, discourages entrepreneurial risk tak- ing, distracts management and has small benefits for class members but big benefits for their lawyers. Plaintiff counsel often turn to a small stable of clients, said Giuffra, with those clients holding tiny num- bers of shares in a large number of companies. Few cases reach trial because of the costs of discovery, particularly in the age of email and the proliferation of documents it cre- ates, he said. That means defendants are often forced to settle, whether a case has merit or not. Speaking specifically about securi- ties litigation, Giuffra pointed out that company stock prices can rise and fall for many reasons. “That’s capitalism,” he said. M edical and legal profes- sionals at yesterday’s all- day session on assisted reproductive technologies (ART) dis- cussed the ins and outs of having children by artificial means. Panellists identified the reasons for the public’s growing desire for access to ART in recent decades as infertility due to delayed childbear- ing and later marriages, as well as the heightened visibility of same-sex couples. Since the birth of Louise Brown via in vitro fertilization (IVF) in 1978, there have been over 1,000,000 babies born as a result of ART. However, the ethical questions raised by the procedures – which involve surgically removing eggs from a woman’s ovaries, combining them with sperm in the laboratory, and either returning them to the woman’s body or donating them to another woman - have made ART an increasingly controversial issue over the last two decades. IBA delegates get a lesson in ART People’s hero makes the case for class actions FAMILY LAW “John Travolta made more money playing me than I ever made” Jan Schlichtmann Continued on page 2

Transcript of CONTENTS People’s hero makes the case for class actions ...Ambush, or guerilla marketing is any...

Page 1: CONTENTS People’s hero makes the case for class actions ...Ambush, or guerilla marketing is any technique through which organizations attempt to associate themselves with a sponsored

Lawyers look out forambush marketing 2IBA Quiz 2

Delegates warned ofwireless dangers 3

The House of Blues 4

The challenge of leadership 6

Chicago SymphonyOrchestra 7

Age of enforcement 8

Today’s schedule 10Law firm networks 12A privileged position 14Clients’ tips on getting hired 15The new age of private equity 15

C O N T E N T S

C h i c a g o C o n f e r e n c e 2 0 0 6 W e d n e s d a y , S e p t e m b e r 2 0

S p o n s o r e d b yP u b l i s h e d b y

“John Travolta made moremoney playing me than Iever made,” joked Jan

Schlichtmann talking about theWoburn toxic tort litigation in asession yesterday. Schlichtmann, ahigh profile plaintiff lawyer as wellas the subject of feature film A Civil

Action, joined other litigatorsincluding Melvyn Weiss, the so-called king of class actions, in a ses-sion on whether these cases are“necessary… evil… or a necessaryevil”.

The debate comes at a time whenclass action litigation is stretchingoutside the US, explained speakers.Schlichtmann spoke first to defendthe use of class actions. “The financialbenefits of bringing cases and thesocial good that comes from them aremutually compatible,” he said.“That’s the beauty of capitalism.”

He did acknowledge, though, theneed for plaintiff lawyers to improvetheir public image and “answer theclaim that this is all about lawyers andnot about clients or justice”.

Class actions can have benefitseven when you lose, saidSchlichtmann. In the Woburn case,for example, it was his team ratherthan a government body or corporatethat first brought together the neces-sary scientists to discuss the possibleeffects of industrial toxins that hadbeen leaked into the town’s localwater supply.

“Class actions are not about fight-ing power,” he concluded. “They are

not about revenge. They are notabout abusing power. They are notabout any of those things. They areabout civilizing power and we civi-lize power through the law.”

Weiss, of Milberg Weiss in NewYork, argued in his address thatfewer class actions are frivolous thanare presented as such by the media,while emphasizing the costs thatfirms take on when pursuingactions.

Seventeen years after the ExxonValdez scandal his clients are yet toreceive any payment despite winninga $6 billion jury verdict, he told dele-gates. The firm itself spent millions inbillable time on that case.

Looking ahead to afternoon ses-sions in which the trend towardsclass action-type legislation inEurope and elsewhere was discussed,Weiss said “there is not a society inthe world that doesn’t need classactions”.

Responding to the case put byWeiss and Schlichtmann, RobertGiuffra of Sullivan & Cromwellopened after coffee by joking that hefelt inclined to stand and cheer dur-ing their session. “It’s amazing thatyou can have justice without classactions,” he added wryly.

But the picture of class actionspainted by his colleagues in themorning was far from complete, hesaid. In fact, argued Giuffra, the“cowboy justice” that is made possi-ble by class action legislation leadsto an increase in the cost of capital,

discourages entrepreneurial risk tak-ing, distracts management and hassmall benefits for class members butbig benefits for their lawyers.

Plaintiff counsel often turn to asmall stable of clients, said Giuffra,with those clients holding tiny num-bers of shares in a large number ofcompanies. Few cases reach trialbecause of the costs of discovery,

particularly in the age of email andthe proliferation of documents it cre-ates, he said. That means defendantsare often forced to settle, whether acase has merit or not.

Speaking specifically about securi-ties litigation, Giuffra pointed outthat company stock prices can riseand fall for many reasons. “That’s

capitalism,” he said.

Medical and legal profes-sionals at yesterday’s all-day session on assisted

reproductive technologies (ART) dis-cussed the ins and outs of havingchildren by artificial means.

Panellists identified the reasons

for the public’s growing desire foraccess to ART in recent decades asinfertility due to delayed childbear-ing and later marriages, as well as theheightened visibility of same-sexcouples.

Since the birth of Louise Brown

via in vitro fertilization (IVF) in1978, there have been over1,000,000 babies born as a result ofART. However, the ethical questionsraised by the procedures – whichinvolve surgically removing eggsfrom a woman’s ovaries, combining

them with sperm in the laboratory,and either returning them to thewoman’s body or donating them toanother woman - have made ART anincreasingly controversial issue overthe last two decades.

IBA delegates get a lesson in ART

People’s hero makes thecase for class actions

FAMILY LAW

“John Travoltamade moremoney playingme than I evermade” Jan Schlichtmann

Continued on page 2

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“Science is ahead of the law,” said ses-sion moderator Stephen Komie, who alsochairs the IBA Family Law Committee.“Lawyers are notoriously bad scientists, sowe have to join in partnership with themedical community.”

In the US, family matters are committedto the states, a reality that panellists said hasresulted in widely varying laws concerningART-related issues. Illinois, for example,recently passed a statute requiring insurancecompanies to cover IVF procedures, whilejust one state away, in Wisconsin, there areno laws regulating ART.

Much of the legal debate over ART stemsfrom questions concerning the point at whichlife begins. According to panellist NanetteElster, assistant professor at the Institute forBioethics, Health Policy and Law at theUniversity of Louisville School of Medicine,“the status of the embryo has been found tolie somewhere between person and proper-ty,” except in the state of Louisiana, where

embryos have been officially defined as peo-ple. Such definitions can cause conflict withART procedures such as Pre-implantationGenetic Diagnosis (PGD), which can help toscreen for genetic disorders such as Down’sSyndrome or allow parents to choose the sexand even eye colour of their baby. “There isdefinitely a certain segment of the populationthat considers what we do immoral,” saidpanellist Dr Randy Morris of the Society forReproductive Endocrinology and Infertility.

During the morning session, medical pro-fessionals discussed the processes involvedwith procedures such as egg donation, surro-gacy and PGD, while later in the day, attor-neys representing the UK, Canada, Spain andthe US compared their legal systems’ varyingapproaches to ART.

Domenic Crolla of Gowlings in Canadanoted that, in light of the fact that ART isstill widely uncharted territory for legal pro-fessionals, “there is a huge need to shareexperiences across the globe on regulatoryprocedures.”

The IBA’s ART lessonsFAMILY LAW

Law firms need to get creative to pro-tect corporate clients’ interests againstrivals’ marketing campaigns, delegates

were warned yesterday. Ambush, or guerillamarketing is any technique through whichorganizations attempt to associate themselveswith a sponsored event or product. Theaudience at the Legal Practice Division ses-sion was shown examples of ambush market-ing campaigns from companies including air-line Lufthansa and Viagra-producer Pfizer,but given a serious warning from panelmembers that creative thinking is required toprotect clients’ interests.

“Marketers are clever and highly cre-ative,” said Richard Wirthlin, partner atLatham & Watkins in Los Angeles. “Theyare aware of the dangers of breaching intel-lectual property rights and will conduct

campaigns that do not infringe formal legalrights.”

So lawyers are faced with a situation wereclients have paid substantial sums to sponsorevents such as the Olympics Games or thesoccer World Cup but are left without directlegal redress in the event of ambush by arival unofficial sponsor. The answer is tosecure the commitment of event hosts toprotect exclusivity against third parties, saidWirthlin. Lawyers must ensure that licenceagreements with host organizations such asFifa and the International OlympicCommittee contain adequate undertakings toprotect sponsors’ interests.

The panel drew a distinction betweenstrict legal rights and wider commercialinterests, and advised that lawyers must pro-tect both. Jorg von Appen of sports rights

marketing company Sportfive in Germanyused examples from the recent Fifa soccerworld cup to illustrate how creative ambush-ers can be. Von Appen drew laughs fromdelegates with an account of how Fifaorganizers confiscated the trousers of thou-sands of Dutch supporters before their coun-try’s match with Ivory Coast this summer.The orange lederhosen-style trousers hadbeen distributed by brewer Bavaria, a rival ofofficial sponsor and Budweiser-makerAnheuser Busch. As a result, groups ofDutch supporters watched the game in theirunderpants. The panel cautioned that effortsto protect sponsorship must be exercised rea-sonably or face the prospect of becoming thesubject of legal challenge.

Soren Pietzcker of German firm HeukingKuhn Luer Wojtek told delegates that the

concept of ambush marketing dates back to adispute between photographic materialscompanies Kodak and Fuji during the 1984Olympics. “Ambush marketing is difficultfor lawyers as it encompasses both illegalinfringement and legitimate commercialexploitation,” said Pietzcker. “But leftunchecked ambushing threatens the financialfuture of many sporting events.”

Not all ambush marketing is threateninghowever. Examples extend beyond sportingevents and delegates heard that lawyers act-ing for rights holders need to appreciate thevalue of publicity. “The technique has beenwelcomed in other circles,” said Wirthlin,who pointed to a campaign run by Chevronassociating itself with the Pixar animationfilm Cars through the use of unofficialadvertisements.

Lawyers on the look out for ambush marketingMARKETING

EDITORIALManaging editor: Rob MannixE-mail: [email protected]: Simon CromptonE-mail: [email protected]: Ben Maiden, Dan Andrews, Eileen McDermott

PRODUCTIONProduction editor: Luca Ercolani

ADVERTISINGAssociate publisher: Leon WinghamTel: +44 20 7779 8379Fax: +44 20 7779 8665

Group publisher: Danny WilliamsDirector: Christopher Fordham

IBA Daily News is produced by Legal Media Group, and published by EuromoneyInstitutional Investor Publications PLC, London. The copyright of all editorial matterappearing in this newspaper is reserved by the publisher. No matter contained herein may bereproduced, duplicated or copied by any means without the prior consent of the holder ofthe copyright, requests for which should be addressed to the publisher. No legal responsibili-ty can be accepted by Euromoney Institutional Investor, Legal Media Group or individualauthors for the articles which appear in this publication. Articles that appear in IBA Daily

News are not intended as legal advice and should not not be relied upon as a substitute forlegal or other professional advice.

Directors: PM Fallon, chairman and editor-in-chief; The Viscount Rothermere, joint president; Sir Patrick Sergeant, joint president; PR Ensor, managing director; D Alfano;JC Botts; E Bounous; SM Brady; CR Brown; MJ Carroll; DC Cohen; CHC Fordham; J Gonzalez; CR Jones; RT Lamont; G Mueller; NF Osborn; CJFS Sinclair; JP Williams

Opinions expressed in IBA Daily News do not necessarily represent those of the IBA or anyof its members.

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IBA DELEGATE QUIZ

Join the funThroughout the week, the IBA will berunning a competition for IBA delegates.Winners will be announced each day inthe IBA DAILY NEWS.

Below is a list of questions which mustbe answered correctly, on the correctday. Answers should be written on theback of a business card and put in a bal-lot box on the IBA Marketing Stand.There will be a different prize every day.

WEDNESDAYPrize – Kenneth Cole Leather Luggage Bag1) Who is the managing editor of Chambers USA and

Chambers Global?

2) According to the July/August issue of Asialaw, whichinternational law firm has the most “LeadingLawyers”?

Quiz rules1) New prize Monday, Tuesday, Wednesday and Thursday 2) One entry per person per day – Entries each day must only answer

the questions for that day3) Prizes are non-refundable and non-exchangeable4) Winners will be listed in the IBA Daily News5) Winners will be selected at the IBA marketing stand each evening,

the main prize for the Hyatt vouchers will be selected on Thursday 21September at 5pm

6) Write your correct answer on your business card andpost in the ballot box on the IBA marketing stand

7) Answers will be found at the relevant exhibitor stands 8) Staff of the IBA and exhibitors cannot enter the com-

petition 9) IBA decision is final

and Tuesday’s winner is...

Jonathan Chu, EsqGolden Gate UniversitySan Francisco, US

Come and collect your prize at the IBAstand opposite the registration desks

Continued from front page

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www.legalmediagroup.comIBA Daily News - Wednesday, September 20 2006 3

Before you read this article you mightwant to check that your laptop issecure: someone close by could be

reading your or your client’s private data. At asession yesterday delegates were warned ofthe challenges to internet security, and in par-ticular the risks posed by new wireless tech-nologies.

Wireless applications, and particularly WiFicomputer networks, are rapidly becomingindispensable tools for the legal profession aslawyers try to stay in touch with clients, dealsand cases, often while on the move. But evenin the apparent safety of a gathering such asthe IBA conference you could be at risk fromhacking, and the results can be disastrous.

At yesterday’s meeting Daniel Preiskel ofthe London-based firm Preiskel & Co tolddelegates that in the conference centre onMonday his computer was able to detecteight or nine other laptops that weresigned on to vulnerable computer-to-computer systems. Anyone with basicIT skills would have been able toaccess these computers and removeinformation, he said.

Preiskel recalled a fellow lawyerwho recently had a laptopstolen from whichthieves took sensi-tive informationregarding a numberof high-profilecelebrity clients.He also pointed to

the dangers posed by using local wireless net-works while conducting negotiations with anopposing law firm, perhaps at a private clubused by that firm. While doing so may savetime and the use of awkward cables, saidPreiskel, it also leaves you exposed to poten-tial hacking by the opposing firm or a thirdparty who could then use price sensitive orpersonal information about your client in thenegotiations.

The thought of either of these scenariosshould send a shiver down any lawyer’s spine,but Preiskel suggested some practical tips forlimiting the risks. Firstly, lawyers should bearin mind that equipment such as PDAs, laptopsand Blackberrys can and will be stolen andtake appropriate steps. Firms should also gobeyond basic WEP-level security and useTemporal Key Integrity Protocol, or TKIP,

measures to encrypt laptops and officeWiFi networks. Law firms with

WiFi areas for clients to use insidetheir offices should make surethese cannot be seen or accessed

from outside the building.Particularly risky places to be

online include trains, where poten-tial hackers are in close prox-

imity and often havehours to get into yourmachine, and free city-wide WiFi networks.Lawyers should limit

the amount of timethey spend online

or with their laptop’s WiFi port activated,said Preiskel, as that is when they are mostvulnerable.

To limit or remove their liability, firmsshould (in addition to adopting technicalmeasures) ensure that clients who log ontotheir WiFi networks can only do so byaccepting terms and conditions. They shouldalso check the fine print of their contractswith clients to limit their liability as far aspossible. In-house counsel, meanwhile, shouldask their outside lawyers what security meas-ures are in place to prevent hacking, if possi-ble get a demonstration, and again look to thecontract to make sure they have recourse tosue the firm if there is a problem.

The dangers of internet security are by nomeans limited to wireless systems, and arerapidly becoming front page concerns forgovernments and regulators around the world.Speaking at yesterday’s session, StevenWernikoff of the US Federal TradeCommission (FTC), which is charged withconsumer protection, highlighted the extentof the problem. According to Wernikoff, loss-es to internet fraud in the US grew from$205 million in 2003 to $336 million just twoyears later.

Fifty-seven million people are on thereceiving end of phishing attempts, saidWernikoff, which have a 3% success rate.Spyware affects 18 million computers andaccounts for up to 50% of calls to IThelplines. Globally, spam is estimated to cost$50 billion in lost productivity, 70% to 80%

of which is sent through hijacked, or so-calledzombie, computers.

Bodies as diverse as the Council ofEurope, the OECD, the G8, the UnitedNations, Interpol and the ICC are all intro-ducing committees, rules and collaborativeteams aimed at tackling consumer protectionissues such as spam and phishing, online secu-rity and privacy and child safety.Governments are also starting to introducelegislation. Of the more recent developments,California’s state assembly has passed a lawtargeting wireless technology. Assuming gov-ernor Arnold Schwarzenegger signs the law ineffect, from October 2007 providers of WiFirouters in the state will be required to attachclear labels or other signals to warn consumersof security risks and the dangers of havingunsecured wireless networks.

But while these efforts are moving for-ward, and enforcers such as the FTC arebringing successful cases, they have so far hadlittle effect on the explosion in internet-relat-ed crime. “There’s no silver bullet to thisproblem, you have to take a multi-prongedapproach,” said Susan Schorr of theInternational Telecommunication Union.Schorr argued that technological, industry-based, regulatory and enforcement approacheswill all be required to stay ahead of the phish-ers, spammers, hackers and traffickers. In themeantime, the simplest and quickest way toavoid any nasty surprises might be to makesure that WiFi connection on your laptop isturned off.

Delegates warned of the dangers of wireless INTERNET SAFETY

Daniel Preiskel, Preiskel & Co

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At 329 North Dearbon, Marina City sitsChicago’s House of Blues. Whetheryou want to eat a meal, watch a band

or just drink a few beers in atmospheric sur-roundings, the House of Blues is a popularplace to be. You are just as likely to bump intoa blues legend at the bar as you are to catch aset by bands or popstars who wish to add anelement of authenticity and credibility to theirtours. Only last month Justin Timberlake pre-viewed songs from his new album at thevenue. In contrast, BB King and ArethaFranklin are lined up for the coming months.

Chicago has always been heavily connectedto many forms of music. Jazz, gospel,Dixieland, blues and hip-hop all have stronglinks to the Windy City. From the piano riffsof Big Maceo Merriweather to the chart top-ping beats of Kanye West, “Chi-town” hasbeen integral to the development of Americanmusic and it is no surprise that the ownersdecided to place a House of Blues here.

However, there is no larger brother to thecity (bar Jake and Elwood) than MuddyWaters. He may have been born inMississippi, but Waters moved to Illinois in1943 and is now perceived by many as thefather of Chicago blues.

Aside from his music, it is well known thatWaters was an excellent southern style cook.According to his website, “he often enter-tained friends and family at his suburban

Chicago home and it was certain thathe would be in his kitchen preparinga feast to keep his guests satisfied.”

Southern food goes hand in handwith the spirit of the blues and it istherefore an essential addition to themusic at the House of Blues. Therestaurant and the main stage areseparated, but they are by no meansmutually exclusive. Indeed, musicspills into the restaurant where liveblues is performed on the BackPorch Stage every night at 9.00pm.Jessica Yell of the House of Bluesexplains that “there is a covercharge of $7 at the bar and mostpeople on hectic business trips loveto relax and watch an authenticChicago blues band.”

It is hardly a surprise that manypeople flock to the restaurant andattached bar. On top of the first ratemusic on offer, the restaurant’sexcellent menu caters for those witha taste for the south. Naturally seafood, chick-en and ribs are high on the agenda, but allyour other favourites are expertly cookedwith a sense that it has been homemade fromscratch. This is especially the case on thestarter menu where options from the StockPot come highly recommended.

On the face of it, you may not believe thata trip to Chicago’s House of Blues will bringback memories of last year’s IBA Conference.But you would be wrong. The venue’s

www.legalmediagroup.comIBA Daily News - Wednesday, September 20 20064

The House of BluesNicholas Pettifer invites you to try out one ofChicago’s famous music venues

LOCAL ATTRACTIONS

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humbly titled Music Hall is modelled on theEstavovski Opera House in Prague, a fact thatwill no doubt be a topic of conversation at theconference closing party on Friday evening.

This is not to say that the décor is entirelyeastern European. Indeed, the themes of dif-ferent areas are as diverse as the bands thatplay the venue today. Gothic design is mixedwith East Indian themes and Moroccanundertones fuse with Asian aspects and, ofcourse, styles from the southern US states.

This hotchpotch of cultural influencesblends well to create a surprisingly homelyatmosphere, where what hangs on the wall isjust as interesting as the music played, thefood served or the drinks poured. For theclosing party, the IBA has hired the wholevenue, so Friday night will be the ideal timeto explore the House of Blues yourself.

In particular, this is a special opportunityto visit the exclusive Foundation Loungewhich is usually reserved for members only.

Shooting off this luxurious area are multiplethemed Prayer Rooms for groups to speakprivately. These rooms provide quiet, seclud-ed islands amidst the noise of the rest of thevenue – the perfect place to round off thatlast bit of business before the end of theweek.

But make sure you do not miss out on allthe entertainment provided. The IBA hashired a steel guitar trio, a blues quintet, aFlemenco guitar duet and a Sitar, Tanpura

and Tablas trio to play in all areas of thevenue on Friday evening. The undoubtedhighlight will be on the main stage, where theFrank Catalano Jazz Quartet will perform.

Why wait until Friday? If you want to make a

reservation at the restaurant, call 312.923.2000

and then select option two. The House of Blues can

be found at 329 North Dearborn, Marina City,

Chicago and there is valet parking available. Visit

www.hob.com for directions and further details.

www.legalmediagroup.comIBA Daily News - Wednesday, September 20 2006 5

Why not catch a band in the Music Hall this week? This week’s line up is as follows:

Wednesday September 20: Sugarcult with The Spill Canvas, Halifax, Maxeen and So They Say

Thursday September 21: Three Dog Night

Friday September 22: IBA Closing Party

Saturday September 23: Peter Frampton with The Elms

It is advisable to book tickets for the 1300 capacity Music Hall inadvance. For a unique experience you may wish to rent one of theOpera Boxes that flank the stage. They hold between 10 and 25 peopleand come with their own cocktail server.

Ticketline: 312.923.2000 (then select option one)

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Guy Beringer is speaking to The IBA Daily Newsfrom home in the UK before he flies out toChicago for this year’s conference. He is excited

about the weekend’s Rule of Law Symposium, but has somewords of caution for law firm managers.

“The legal world is changing,” says Beringer. “There ismore consolidation coming and there is only going to bespace for a limited number of global law firms.” Beringersays that this consolidation will involve transatlantic mergersand will go ahead at some point in the next five years,though no one can say when. The message is that thischanged legal world will accommodate both globaland national (or niche) firms, but nothing inbetween. “National firms can prosper, providedthey are correctly managed,” says Beringer.“There is room for both types of firm, in factthey compliment each other. The trick is notto get caught in the middle.”

Beringer identifies one other big challengefacing large firms, how to attract and retain thebest people. The current generation have differ-ent expectations and ambitions than thosethat have gone before them, saysBeringer. Their experiences aremore diverse than ever beforeand they will seek outcareers that match thesedemands. All firms arestruggling with this shift inexpectations, he says. There

is no magic bullet but firms have to adapt to cope with thedemands or the profession as a whole will miss out.

Beringer thinks that the IBA has a big role to play in thisrespect. No other organization can produce the breadth offirms in one place and make combined knowledge on bestpractice available to all.

Turning to the challenges facing the legal profession as awhole Beringer is keen to emphasize the importance ofengagement. “The profession needs to be better at lookingahead. The right to self regulation has to be earned and wemust be more proactive in promoting change.” Beringer

admits there is no historical basis for this sort of engage-ment with government and regulators, but this issomething he thinks needs to change. “It would be amistake to continue to fight tooth and nail overevery piece of regulation,” he says. “Instead, theprofession should be offering its own solutions,dealing with issues and promoting change beforeregulators are moved to act.”

On the issue of effective regulation, Beringerthinks the focus needs to be moved from the exclu-

sively individual to an acknowledgement that firmshave a big role to play in the quality of legal serv-

ices provided to clients. “Regulators havetraditionally concentrated on qualificationrequirements and offering means of

redress,” he says. “But firms are effec-tively proxies to quality and systemsdetermine the quality of adviceclients receive.” Beringer thinks that

regulators have been slow to pick up on this and that it isone instance where law firms can be proactive in offeringsolutions.

Ethics is another theme Beringer likes to concentrate onduring IBA conferences, where lots of time is spent lookingat different codes. He thinks codes need expanding to incor-porate a duty on the profession as a whole to provide careerdevelopment for its individual members. “Without a com-mitment to training and progression the profession will notattract the best people,” he says. The case for change here isthe same as that for quality – duties need to be placed onfirms as well individuals. Beringer thinks that training is onearea in which government will regulate unless the professiontakes the initiative.

As evidence for a change in approach to outside regula-tion, Beringer points to the European Commission’s reporton competitiveness and the debate over the ServicesDirective. The profession has fought the Commission overthis but Beringer thinks constructive engagement will ulti-mately prove more satisfactory than belligerent opposition.

In terms of what it takes to be successful in the micro-management of a global law firm, Beringer is reluctant tosteal too much of his own thunder ahead of Wednesday’sleadership session. But he does reveal that active engagementis the key not just to dealing with regulators, but also withmatters in-house. “The partnership model demands engage-ment,” he says. “A dictatorial position does not work.” Hethinks that a set of clearly articulated objectives is vital, butthat this is just the start. Momentum will only be generatedif you take people with you, he says. “Management mustencourage and win others over. This requires a lot of workand effort, but with consensus the partnership model isstrong, without agreement it is weak.”

The challenge of leadership Daniel Andrews speaks to Guy Beringer, Allen & Overy’s senior partner, onthe challenges of law firm leadership

PROFILE: GUY BERINGER

www.legalmediagroup.comIBA Daily News - Wednesday, September 20 20066

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Atrip to the Symphony Center of theChicago Symphony Orchestra shouldnot only be on the to-do list of classi-

cal music lovers across the globe, but also onthose of any visitor to the city wanting toabsorb all of the vibrancy that it has to offer.

Within the striking architecture of theCenter lives an orchestra that continues to be areal musical force, greeting the music worldwith some of the greatest performers in the US.

Designed by the famed Chicago architectDaniel H Burnham and completed in 1904,Orchestra Hall, now a component of theSymphony Center complex and the orches-tra’s main home, is located at 220 SouthMichigan Avenue.

For some 90 years the orchestra has offeredthe world its glittering performances, withmany noted recordings – the orchestra hasamassed a discography totalling more than 900.In fact, as early as 1916, the year that the poetCarl Sandburg announced the “stormy, husky,brawling…City of big shoulders”, the Chicagosymphony became the first American orchestrato record under its regular conductor. But atrue measure of their success is that recordingsby the orchestra have earned 58 GrammyAwards from the National Academy ofRecording Arts and Sciences – a haul which noother orchestra can match. No surprise thenthat broadcasts and recordings are an importantpart of the CSO’s activities, with performances

so well received that they are offered on over200 radio stations across America.

Over the years, guest conductors have nat-urally flocked to the orchestra. Such house-hold names as Richard Strauss, Camille Saint-Saëns, Edward Elgar, Leonard Slatkin, AndréPrevin, Michael Tilson Thomas, LeonardBernstein, Leopold Stokowski, MortonGould, Erich Leinsdorf, Walter Hendl,Eugene Ormandy, George Szell and CharlesMunch have all visited.

The Chicago Symphony Orchestra has alsoperformed music for various movies, includ-ing Immortal Beloved (conducted by SirGeorg Solti) and Fantasia 2000 (conducted byJames Levine).

The Orchestra has gone from strength tostrength over the past year or so, with two ofthe world’s most celebrated conductors assum-ing titled positions for the 2006-2007 season.The foremost Dutch conductor Bernard

Haitink has been handed the role of principaldirector and the revered French composer andconductor Pierre Boulez, the CSO’s HelenRegenstein principal guest director since 1995,will assume the role as its conductor emeritus.

As for tonight’s performance, Myung-Whun Chung, principal conductor of theSeoul Philharmonic Orchestra and musicdirector of the Orchestre Philharmonique de Radio

France, leads the Chicago Symphony Orchestrain works by Beethoven and Shostakovich.Born in Seoul, Korea, in 1953, Chung madehis conducting debut in 1971 with the KoreanSymphony Orchestra. Carlo Maria Giuliniappointed him assistant conductor at the LosAngeles Philharmonic in 1978 and two yearslater promoted him to associate conductor. In1989 he became music director of the OpéraBastille, a post he held until 1994.

This September, music lovers around theworld celebrate the 150th anniversary of Dmitri

Shostakovich’s birth. The Fifth Symphony isone of his most beloved works. Written afterhe was toppled almost overnight from his posi-tion as the leading light of Soviet music afterStalin denounced his Lady Macbeth of Mtsensk,the Fifth Symphony was his successful rehabili-tation and was reported as “a Soviet artist’spractical creative reply to just criticism”.

The champagne reception and gala perform-ance takes place tonight at 18:15, in aid of theIBA’s Human Rights Institute. Start the eveningoff in style with a glass of champagne whileadmiring the theatre’s spectacular interior design.The performance begins at 19:00. Local lawyerswho do not register for the conference will havethe opportunity to purchase concert tickets for$35. For further information on this please con-tact the IBA office for a booking form.

The IBA would like to thank the follow-ing firms for kindly hosting the concert: DLAPiper Rudnick, Kirkland and Ellis LLP,Mayer Brown Rowe & Maw LLP,McDermott Will & Emery LLP, Sidley AustinLLP and Winston & Strawn LLP.

Michael Kibblewhite previews tonight’s galaperformance by the Chicago Symphony Orchestra

www.legalmediagroup.comIBA Daily News - Wednesday, September 20 2006 7

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The founder and head of Doughty Street Chambers,Justice Robertson boasts an impressive résumé, actingas counsel in a number of landmark cases in constitu-

tional, criminal and media law in the courts of Britain andthe Commonwealth, frequenting the Privy Council and theEuropean Court of Human Rights. In 2002 his expertisewas called upon to act as appeal judge for the UN warcrimes court in Sierra Leone, where he served as the Court’sfirst president.

As for this conference, Geoffrey Robertson’s primary rea-son for speaking is to discuss his recent critically-acclaimedoffering, The Tyrannicide Brief. In this work, Robertsonassesses the execution of Charles I though an alternative lens,that of the radical barrister John Cooke, holder of the title ofthe “bravest barrister in British history”. Skilfully reapprais-ing the events that actually led to the trial and execution ofCharles I, Robertson has brought an almost forgotten agentof history into the light, one “who was the only barristercourageous enough to take on the prosecution of the king”.

Cooke is presented as “a man ahead of his time”. Alawyer that even in the mid-1600s was advocating the limi-tation of capital punishment, suggesting the link betweenpoverty and crime, calling for an end of imprisonment fordebt and the end of Latin in the courtroom.

Robertson also highlights the fact that unfortunatelyCooke brought about another great reform – that of the so-called cab rank rule. He was the “first barrister to takeadvantage of that rule, although this was no advantage tohim because he was disembowelled,” says Robertson.

The Tyrannicide Brief is also particularly pertinent for anAmerican audience. Robertson enthuses that the work is“very appropriate given the American failure to recognizetheir own intellectual input into the civil war and the parlia-mentary side”. The author reveals that the input ofHarvard’s graduation class – Hugh Peters and Henry Vainduring their puritan colonial experience – proved consider-able in moving the country towards a republic, somethingthat still holds considerable strength now. “The basic west-ern democratic values that we all revere today were allfought for by these men,” he says.

Justice Robertson is also keen to assert that practitionersin this age can learn a great deal from John Cooke. “Insearching our conscience for the root of our professionalethics, we need to go back to Cooke and his writings on thevindication of the legal profession and those who profess it.He was writing in defence of it at a time when many practi-tioners were crooked and corrupt, yet he was able to defineand argue for a legal good life.”

Finally, Robertson reiterates the fact that Cooke in hiscapacity in prosecuting Charles I successfully made tyranny acrime, representing a charge that set the precedent for cen-turies after. Sacrificing his life, Cooke ensured that tyrantswere not above the law; a message that the court currentlyhousing Iraq’s chief despot will continue to articulate.

Robertson is also the author of what is considered thehandbook of the human rights movement; coinciding withthe developments in this arena, it offered an argument forthe international criminal court. The new instalment, thethird edition of Crimes Against Humanity: The Struggle for

Global Justice, has taken into account the invasion of Iraq,Darfur and the early days of the international criminal court.“It is still subtitled The Struggle For Global Justice because it is

still a struggle and hasn’t become any easier since the lastedition,” he says. Although there have definitely beenadvances in global justice mechanisms, Robertson insists thatwe are only at an early point in a long march.

Elsewhere, he believes that the much-criticised Milosevictrial was a great milestone in what is considered the age ofenforcement (as opposed to the previous age of ideas), butexposed the need for fine tuning in the procedures of theinternational court. Robertson believes that beginning at therudimentary, procedural level is the place to start, makingsure that the courts run on time.

Clearly there was an overwhelming demand for anotheredition in the wake of more international trials - a furtherinstalment of the “book to stop another holocaust” (The

Observer). Moreover, the law remains agonisingly unclear.

And in this age of enforcement, where international trials areoften a daily fixture portrayed on numerous platforms,understanding of the protocol has to be “comprehensible tomillions of people”.

Overall, the aim was “to write a text book that could beunderstood by ordinary people and make these momentouschanges comprehensible to people whose support for them isvital”.

He proceeds to enthuse that, “the members of AmnestyInternational (now over one million) have to understandwhat it’s all about and I don’t think the cause is helped bynon-lawyers or by complicated Latin phrases…internationallaw is gobbledegook even to other lawyers too often and isvery academic”.

As for the future of human rights, naturally Robertsonacknowledges that history will judge the UN (as chiefenforcer) on whether it succeeded in its “vital role”.Critical of the UN code of conduct in the past, he hasrecently “willingly” worked with them as a judge and morerecently on a complicated report on its internal justicemechanisms, arguing that “when looking at the justice that itprovides for its own staff, you have to recognize that it’soften not practicing what it preaches”.

But as there is no alternative, “one has to try and make ita more effective force in the world”. Robertson believesthat a police force is a necessary start because peacekeepingis such a vital role, particularly after the handling of theDarfur debacle by the African Union. But so is setting upcourts and justice systems.

He says that the wars of the 21st century will be consis-tently fought in the court room, because of the persistentcriminal elements (which “surface in the end”) where aquick-fix deal by diplomats can be nothing more thansmoke and mirrors. In a sense, with the consolidation of thehuman rights movement and the rise of mass media, theworld is getting closer to understanding what a just societymay look like.

Therefore “sooner or later you will get demands to dealwith those who man the death squads or the torture cham-bers” as opposed to the forgive-and-forget rhetoric of timespast. What is more, Robertson says he is “unforgiving wherecrimes against humanity are concerned and [I suspect] thatno matter what deals may be patched together to promote a

particular peace it will be useless unless there is a measure ofaccountability”.

Universal declarations such as the Geneva and genocideconventions came into force in the 1940s, only to disappearduring the Cold War until the setting up of courts in theearly 1990s. To continue the progress, “all lawyers todayhave a duty and interest to support human rights, but also tostudy it and see in practical ways how it can be adapted andenforced. We are now in the age of enforcement, whichdoes mean that as lawyers we ought to be very aware of it”.Robertson remains confident that the problems associatedwith previous cases will be rectified.

Throughout his career, Justice Robertson has been astaunch opponent of capital punishment, with long standingdissent in courts and in books. In his own words, “this cameto the crunch when I was involved in the training of thejudges to try Saddam, and the Americans were very support-ive of the death penalty. I was not”. It is obvious thatSaddam cannot remain in Iraq at the pleasure of its govern-ment. Without extradition, execution is the only option, butfrom a diplomatic point of view, this is a murky compro-mise.

Robertson emphasises that he “tried to persuade govern-ment ministers that we should do what was done withNapoleon and put him on St Helena; but the people of StHelena want to turn themselves into a tourist resort anddon’t want international convicted criminals there”. Everflexible, Robertson suggests that the Falkland Islands wouldmake a good alternative.

Geoffrey Robertson enters the conference this weekintent on remaining indefatigable in his attempts to widenthe footprint of justice. In his own words he has “fairlymajor responsibilities”, with commitments in Africa as anappeal judge for the UN war crimes court, reforming theinternal workings of the UN and continuing to head thehighly regarded Doughty Street Chambers, which now hasover 80 barristers and 20 silks.

Age of enforcementGeoffrey Robertson QC will speak this week about his recently publishedwork, which links present-day Iraq with Britain in the 1600s. MichaelKibblewhite profiles a career spent advocating human rights

PROFILE: GEOFFREY ROBERTSON

www.legalmediagroup.comIBA Daily News - Wednesday, September 20 20068

“All lawyers today have a duty and interest to support humanrights, but also to study it and see in practical ways how itcan be adapted and enforced. We are now in the age ofenforcement”

“The Tyrannicide Brief isparticularly pertinent for an American audience given the American failure to recognize their own intellectual input into thecivil war”

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TODAY’S SCHEDULE09:30 – 17:00Law firm leadership: transitioning your firm from ‘good’ to ‘great’ Room N426cApres moi – le deluge Room S504dBreaking down barriers to justice Room S503aExpert witnesses: outstanding issues Room S503bLeadership in law firms Room N426c

09:30 – 12:30Career development and management for the new generations Room S504aDoing business with indigenous peoples Room S502bTransfer pricing arbitration Room S401dThe emergence of condominium hotels converted from traditional hotels Room S404dEntrepreneurship and the lawyer: understanding the power of entrepreneurship in the context of the closely held company Room S403aCorporate governance Room S501International trade in art – earning a living dangerously Room N426aUnlocking the value of intellectual property rights Room N427bcCrisis management – how to handle the media Room N427dBig brother is helping you:how space will support your business Room N427aThe basics of international franchising Room N426bUpdate on WTO/GATS and Developing Bar Leaders meeting Room S504bcPro Bono Session – Who’s doing the best international pro bono work? What models are being developed? How can they be adapted? Room S502a

11:15 – 12:30Guidelines for setting up a national young lawyers’ association Room S505a

12:30 – 14:00Public and Professional Interest Division lunch Room N227abcAntitrust Committee Lunch Pane CaldoCapital Markets Forum Lunch Bistro 110

14:00 – 17:00Arbitrator disclosure, conflicts of interest and challenges to arbitrators – IBA Guidelines on Conflict of Interest Room S401a‘Everything should be made as simple as possible but not simpler’ – the drafting of commercial legal contracts and the drafting Room S504aGeneral Interest – Increasing your value to current and future clients: the RAINBOW strategy Room N229CSR: outsourcing and offshoring under NAFTA – corporate social responsibility and the role of in-house counsel Room S501aLawyers in lobbying in the United States and Europe Room S502aCross-border loss recognition Room S404bcAboriginal gaming: a roll of the dice Room S502bCompetition law compliance in the shipping industry Room N427aInvestment banks as gatekeepers in structured finance transactions Room S404d‘Hot topics’ roundtable: burning issues affecting investment funds around the globe Room S404aRecent developments in M&A law Room S403aLitigators’ forum for corporate counsel Room S504bcDamages calculations – cross-border aspects Room S401dEquator Principles and other bank guidelines for financing mining projects Room S505aEntry into the US market: agency, distribution or franchising – pros and cons Room N426bInternational adoption: a US perspective – the good, the bad and the ugly Room S501bcSpecialised intellectual property courts and tribunals: challenges and recent developments Room N427bcThe future of international terminating access Room N427d

18:15 – 20:00Chicago Symphony Orchestra Champagne Reception and Gala Performance Symphony Centre,

220 South Michigan Avenue

20:30Arbitration Committee Dinner Mid-America ClubInsolvency, Restructuring and Creditors’ Rights Section dinner EverestInternational Construction Projects Committee dinner Union League Club of ChicagoCommittees on International Sales and Product Law and Advertising joint dinner NineIntellectual Property and Entertainment Law Committee dinner Bistro 110

All locations in McCormick PlaceConvention Center unless stated

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As in nature, the survival of the fittest decides whosurvives in the legal industry. Firms may call itextending their global network, but the principle is

the same: big fish eat, little fish get eaten.Of course, rules are there to be broken. Just as fish learn

to swim in shoals to create the image of something muchlarger, the rise of the law firm network, consisting of inde-pendent firms working on a sometimes exclusive referralbasis, has been a challenge to the idea that bigger is better.

The appeal of networks is that their members can retaintheir identity, autonomy and culture, while exploiting abroad international base. And their clients benefit too – theyreceive the individual attention and local knowledge offeredby an independent firm, without having to go through thelocal telephone directory looking for a high-quality practice.Furthermore, the chance of a conflict of interest, an increas-ingly common obstacle to international legal work, is greatlyreduced.

But which network to join? Although there’s no clearanswer to that, there are numerous strategies on offer, and itis worth considering your priorities before making a com-mitment. All alliances involve a trade-off which is more sig-nificant than just a joining fee, but if they are well chosenand maintained, relationships with other firms can be fruitfulfor all parties.

Stay independentLex Mundi, Terralex, TAGLaw and their ilk emerged in the1980s and 1990s in response to the relentless growth of firmssuch as White & Case and Sullivan & Cromwell. Thesefirms made (and continue to make) huge profits, but thepressure on individual offices to generate those profits isintense. James Fisher of FSB Corporate Counsel, a networkof in-house lawyers, says: “Each one of the offices [in aninternational firm] is its own profit centre. There’s an incen-tive to capture as much of the billing as possible locally.”

In addition, running a global law firm drives up fees:“There’s just a ton of inefficiencies in the large law firmmodel,” says Fisher, citing the rental of premium officespace and excessive employment of support staff. “Everyoneknows the fees are too high – clients complain about it allthe time. They also complain that they can’t get access tothe type of lawyers they want. What the clients pay for iswhat’s between our ears, not the mahogany desks or theivory towers.”

The networks, by contrast, offer independence, both cul-tural and financial. Balázs Máthé, a Hungarian corporatelawyer who left magic circle firm Linklaters to join localoutfit Hayhurst Robinson, and subsequently set up his ownpractice when his new firm announced a merger with CMSCameron McKenna, says: “I certainly see the advantage ofan independent practice in a country like Hungary, whichwill never be like New York, Shanghai or London.”

Instead, small practices with low overheads, high flexibili-ty and local expertise are more suited to smaller markets,says Máthé. “That’s the future I’m betting on. Foreigncounsel need, more than ever, the solid hand of a reliablename.”

According to Carl Anduri, the president of Lex Mundi,the idea of a tiny regional office becoming a one-stop shopis often a fallacy. Rather, the small scale of the business issomething to be harnessed: “The huge benefit is that themember firm can respond to the local situation and culture.”

Joining a prestigious network is a boon for a small prac-tice, but complacency doesn’t pay: most networks systemati-cally review their members for quality and are not afraid toact on their findings. Besides simply being good practition-ers, members are also expected to demonstrate their com-mitment to the network. Anduri says: “The biggest chal-

lenge for all networks is to increase participation by memberfirms… The most important thing they can do is to beactive in the network. The cliché is that you get out whatyou put in, but with us you also get out what others putin.”

There are plenty of opportunities for member firms toshow willingness. Lex Mundi holds several annual confer-ences, including one held exclusively for managing partners,which was attended by 108 of members’ top brass last year.In addition, the network runs professional developmentcourses, which combine important face-time with thechance to exchange practical knowledge and experience.

Terralex’s new chairman, Charles McCallum, has plans toincrease the contact between the network’s more specializedmembers. Rather than relying on just big events, he feelsthese members are likely to respond better to informal get-togethers, such as a Terralex event within the annual intel-lectual property conference organized by the InternationalTrademark Association (Inta).

“The people who meet there are not necessarily the peo-ple who would come to our regular or annual meetings,”explains McCallum. Instead, their networking tends to takeplace at school reunions, sports clubs and other social events,a mood Terralex aims to replicate. McCallum says: “Theonly way you can forge a meaningful network is by forgingopportunities for direct and personal contact.”

But not all networks are so cosy. As Máthé, who says heis considering joining a network, observes: “Some of themare really close to being one firm; others are like a Yellow

Pages with one name in every country.”

Best friendsAlthough they have many advantages over the homogeneousglobal firms, networks typically have one serious drawback:they lack a strong, unifying brand. The familiarity factorcannot be underestimated, particularly in countries where astrong marketing strategy means the firm has a web page.

In an effort to capture the best of both worlds, UK firmSlaughter and May has developed the so-called best friendsstrategy. Rather than simply buying out foreign offices, thefirm has established informal referral relationships with localheavyweights including Hengeler Mueller in Germany,Bredin Prat in France and Uría Menéndez in Spain andPortugal. This arrangement differs from global firms andmore traditional alliances in that its members are not obligedto keep work within the group.

“We have no formal network as such,” says David Frank,a partner at Slaughter and May. “Whereas 10 or 15 years agoit was perfectly adequate simply to say ‘I know HengelerMueller’, that’s not possible any more. It’s not a question ofus referring work; it’s a question of us doing the work inanother jurisdiction with the help of a firm there.”

The obvious drawback is that even best friends haveother friends too. In 2000, Cravath Swaine & Mooreappointed Herbert Smith, rather than best friend Slaughters,as UK counsel in the mammoth merger of AOL and TimeWarner, worth more than $160 billion. Other dalliancesbetween Davis Polk & Wardwell and Ashurst have alsohighlighted the non-exclusivity of the best friends relation-ship.

Nevertheless, the combination of what-you-see-is-what-you-get branded services with the cultural sensitivity andlocal knowledge of independent firms is potent. “They[clients] can use a law firm they’re familiar with,” says Frank.“At the same time, they’re getting local quality across theboard.”

Not to be outdone, German firm Gleiss Lutz has estab-lished what it describes as a “very best friends” relationshipwith UK firm Herbert Smith and Stibbe, a firm based in the

Benelux region. In fact, business exchanges such as theAOL/Time Warner deal showed that the two networksshare more than just a resemblance. Gerhard Wegen, a part-ner of Gleiss Lutz who helped forge the alliance in July2000, is surprisingly candid about the link between the twogroups: “The concept is the same. The Herbert Smith ringand the Slaughter and May ring are complementary.”

Unlike the Slaughters network, however, Herbert Smith,Gleiss Lutz and Stibbe share a logo style and colour scheme,and all three of their websites trumpet their affiliation via aprominent badge of alliance.

The effect on clients’ experience is the illusion of deal-ing with a single firm. “For me, as a client, [the network]was more or less invisible,” says Kent Rose, chief legalcounsel of Beam Global Spirits & Wine, which consultedHerbert Smith and its affiliates on the company’s purchaseof 20 alcoholic drinks brands from Pernod Ricard. “Therewas a consistency of approach, of management, and of riskanalysis.”

So why not just merge?In the past, the firms have considered becoming a singleentity, even going so far as to perform due diligence. “We

Not every lawyer harbours plans for world domination – some ofthem are happy to conquer just a part of it. Many internationalalliances carve their global networks up into bite-size regions, whichhelps to retain their members’ local cultures as well as making thenetwork easier to manage.

James Davies, a partner of ius laboris member firm LewisSilkin, says: “The Holy Grail is to say: ‘We’ll be your globalemployment lawyers.’ But it’s much more common to do thingsin regional blocks. What we envisage in five years’ time is thatour prospective Chinese member will be working more closelywith our prospective Japanese and Singaporean members thanwith us.”

There are already plenty of networks that exist to serve a spe-cific geographical area, ranging in size from the south of England tothe Asia-Pacific region. These networks are in a better position torespond to specific regional issues, such as the needs of firms inemerging markets, which can get sidelined by the more pressingissues of a global strategy.

The map shows a selection of the larger general practice net-works covering each region. In addition, there are countless spe-cialized regional alliances, networks covering only part of aregion, and networks covering two or more regions.

www.legalmediagroup.comIBA Daily News - Wednesday, September 20 200612

A firm friendshipNot everybody wants to wear white shoes or step into the magic circle.Joining a network is a way to be part of something big without giving up yourindependence, writes Ben Lewis

LEGAL NETWORKS

When the world is too much…

Law firm networks swim together like a shoal of fish

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didn’t find any structural hin-drances, but we didn’t find thenecessity either,” says Wegen.Like many network members, hedescribes quality as the litmus testof a good business model. “Weare more robust because we needthe extra level of energy. Wehave to prove ourselves in everyinstance,” he explains. “In a cen-trally controlled firm you aretempted to heavily prescribequality controls which becomethe lowest common denominator.The clients’ reactions make surewe are, quality-wise, up to date.”

On the other hand, Wegentakes care not to dismiss the pos-sibility of a future merger: “Wewould never say no,” he says.“It’s a question of the market-place. If the market said the bestthing was to merge, we wouldmake an informed decision.”

The focus narrows – or widens“The global law firms are great at what they focus on, butthey’re not interested in employment law,” says JamesDavies, a partner of Lewis Silkin, a firm which is part of spe-cialist labour law alliance ius laboris. The same, claimsDavies, can often be said of the standard law networks: “Ifyou go to a more generalist alliance, you’re not going tonecessarily get the leading practitioners in that practice area.”

Specialist legal networks exist in most practice areas, fromimmigration (such as Immlaw) to estate planning (such as theNational Network of Estate Planning Attorneys). There arealso industry-specific networks, catering for firms and theirclients in the pharmaceuticals, technology and insurance sec-tors, among many others. Besides access to a targeted sourceof business, members can expect more autonomy: “For firmskeen on retaining their independence, joining an alliancewhich focuses on their particular area of practice compro-mises that independence a lot less,” says Davies. There isalso, he claims, more affinity between members: “We findkindred spirits who have normally resisted the overtures ofthe global firms. Therefore, you do get quite a high com-munality of spirit.”

It is easy to paint such an alliance as a clique for bou-

tiques, but this is not necessarily so. Only roughly a quarterof ius laboris’s member firms are niche firms – the rest areclassed as semi-niche (general practice with a focus on labourlaw) or full-service firms – and the alliance appreciates thecultural differences between them. On the other hand, thenetwork’s head office creates consistency by managing a vir-tual brand across its membership, and is now workingtowards a system of shared document templates which usesimilar headings and typefaces. Ius laboris also monitorsaspects of its members’ service such as responsiveness, withthe aim of creating a network-wide seal of quality.

“It’s necessary to get to the next stage and be more thanjust a referral network. Our competitors are really thosefirms that are operating ostensibly as a single firm withoffices in different jurisdictions,” explains Davies. “I thinkpeople looking under the surface of the alliance would besurprised at the level of integration.”

Specialization, though, isn’t always the ideal. Catering forthe other end of the spectrum are a number of networkscomprising not just lawyers, but also accountants and otherprofessionals, such as offshore specialists.

MSI Legal & Accounting Network Worldwide is onesuch group. The network’s client target is small and medi-um-sized enterprises, which often have a single person incharge of obtaining both financial and legal counsel. As such,it shuns specialization in favour of general practice, althoughmany of its members offer specialized services.

As with the other networks, the priority of its members isindependence: “We get firms coming to us saying: ‘We rec-ognize that the market is demanding a national, regional oreven international coverage, but we don’t want to sell oursouls,’” says James Mendelssohn, the network’s chief execu-tive.

MSI is so keen to preserve its small-scale focus that itrecently asked one of its largest US members to resignbecause it was planning to expand. The split was amicable,but it underlined the alliance’s rigid commitment to amodel in which the members know each other on a per-sonal level. Says Mendelssohn: “We feel the personaltouch is vital.”

Selling the networkLegal partnerships have come a long way since the days ofthe informal referral network, when a meeting, a handshakeand a glass or two of wine were a good substitute for a bind-ing contract. Nowadays competition is fierce, and the net-works are raising their gameaccordingly.

“One of the greatestchallenges is sellingourselves,” says Davies.While their membersmust prove themselvesby passing regular quali-ty reviews and generatingpositive client feedback,the networks themselvesalso need to

demonstrate their effectiveness to attract the top firms.For example, many offer training programmes and sec-ondments for lawyers, which can also go some waytowards improving members’ level of English, often aproblem when there is no central headquarters fromwhich to distribute native English speakers among theoffices.

Maintaining a high profile is just as important within thenetwork itself. A high level of participation is crucial to thealliance’s success. Lex Mundi regularly sends out directories,newsletters and resource guides to all of its members, theaim being to increase communication and keep the networkin the forefront of their minds.

There is some way to go before the network modelmatches the international firms’ reputation for seamlessnessand consistency. For one thing, they are battling against tra-dition – their global rivals have built sturdy relationshipswith blue-chip clients, and winning them over is no meanfeat.

But according to Gerhard Wegen, the hardest act fornetworks to follow is their own: “We have proven ourcase,” he says. “The strategy for the future is to keep themomentum.”

US & CANADA

•• Primerus• Toledo Conference Group• United States Law Firm Group

LATIN AMERICA

• • The Bomchil Group

ASIA PACIFIC & AUSTRALASIA

• • Advoc Asia• • Australian Legal Network• • Pacific Rim Advisory Council

MIDDLE EAST

• • Arab Legal Network

AFRICA

• • Lex Africa

EUROPE

• • Advoc Europe• • The Association of European Lawyers• • Eurojuris• • JCA International• • Libralex• • The Parlex Group of European Lawyers• • Trans European Law Firms Alliance (Telfa)

www.legalmediagroup.comIBA Daily News - Wednesday, September 20 2006 13

“The cliché is that you get out what you put in, but with us you also get out what others put in” Carl Anduri, president of Lex Mundiwww.bigfoto.com

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“Lawyers are the priests of the legalprofession,” Microsoft senioranti-trust counsel Greg McCurdy

told delegates at a session organized by theCorporate Counsel Forum yesterday. “Andpriests must be available to hear confession.”Without the protection of attorney-clientprivilege, the role of in-house lawyers is fun-damentally undermined, said McCurdy.

Delegates heard, from a panel consisting ofboth private practitioners and in-house coun-sel, that the principle of privileged communi-cations between attorney and client is underthreat in both common and civil law jurisdic-tions. Denying in-house lawyers the sameprivilege protections as outside counsel, saidMcCurdy, will act as a deterrent to full andfrank confession on behalf of companyemployees and an incentive to concealment.McCurdy said that without the benefit of in-house privilege, companies will be forced torely on outside counsel more often and beless inclined to communicate in writing.

Legal advice privilege protects disclosureof communications between a legal adviserand his client provided that they are confi-dential and in relation to seeking legal advice.

The audience also heard, from John Heapsof UK law firm Eversheds, that legal privilegeis an ancient right that is fundamental to therule of law. But privilege is a complex area oflaw and it is under attack said Heaps. Lawyershave a duty to ensure their clients are fullyapprised of the pitfalls of privilege said Heaps,

who explained that he operates “morningsfrom Hell” workshops with his clients toclarify their position in the event of a surpriseinvestigation, or dawn raid, by investigators.

Earlier delegates heard that the problemsfacing in-house counsel in relation to privi-lege stem from the dual nature of theirresponsibilities. “Courts often presume thatin-house counsel is acting in a business ratherthan a legal capacity,” said VincentWalkowiak of Fulbright & Jaworski.

Meanwhile, delegates heard from experi-enced general counsel on the panel about whatit takes to be a successful in-house lawyer at aglobal corporation. “General counsel is nowincreasingly likely to have a prosecutorial ratherthan transactional background,” said WilliamLytton, general counsel at Tyco International.“This reflects the rise in high-stakes litigationand a media culture that demonizes big busi-ness while lionizing prosecutors.”

Lytton told delegates that corporate scan-dals in the US had resulted in prosecutorsportraying in-house lawyers as “villains in apopulist novel”. Those wishing to pursue acareer in-house need a range of skills andcharacteristics. On the one hand, said Lytton,counsel need the tough investigative qualitiesassociated with trial lawyers, but on the otherthey need the more subtle and nuancedattributes common among successful transac-tional advisers. “General counsel is expectedto become both an expert crisis manger and abusiness adviser in one,” said Lytton.

A privileged position IN-HOUSE COUNSEL

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Attendees at yesterday’sEuropean Forum session heardthat lawyers in central and

eastern Europe (CEE) are failing to liveup to the challenge presented by a newage of private equity that sees invest-ment firms drive into emerging markets.

Session chair Dariusz Wasylkowski ofPolish firm Wardynski & Partners said thatthe private equity sphere is experiencing ahuge shift away from the developed mar-kets that dominated in the “golden age”of the 1990s. Now the focus is on newmarkets such as the EU Accession States,hence the decision to present a joint ses-sion between the IBA European Forumand the Private Equity section.

However, Khai Tan of private equityfirm Advent International in Warsawsaid that one of the problems with thesenew deals is that local law firms aren’talways up to the job. Tan, who couldnot attend the session in person but hadrecorded a DVD of his presentation andwas on speakerphone to take questions,said often local advisors were too for-malistic and impractical. Around a halfof the audience was from CEE.

“We are always very lucky if we seepeople on the other side that we know,”said Tan. “Often firms come along to

meetings and fan out the whole law onthe table, refusing to discuss anything untilthe relevant legal provisions have beenread through. That’s not very helpful ifyou’re preparing a 100-page document.”

Although younger staff at law firms areoften more flexible and approachable, theturnover is very high among non-partnersso it is rare that one ends up working ontwo deals with the same lawyers. “Theresult is you have to have three or four

potential law firms lined up for every deal,which is not ideal,” said Tan.

This is a problem not limited to lawfirms, however. CEE companies face sim-ilar problems with impractical manage-ment and high staff turnover. “Managerstend to be followers, not leaders, and pro-ducers, not sellers. They are often entre-preneurs with their own, highly-central-ized management that isn’t suited to themore aggressive world of private equity.Many have lost staff to western Europe inrecent months. One company we worked

with lost 40% of its call centre staff toemigration in a month,” said Tan.

Both Tan and Justin Bickle ofOaktree Capital Management inLondon identified a few elements thatmake private equity in CEE different towestern Europe. Besides obvious factorssuch as smaller deals (around a tenth ofthe west) and fewer players (around aneighth), they pointed out that propri-etary deals, rather than auctions, are the

norm, as is a smaller amount of debtleverage. “One of the reasons we likeCEE is the number of proprietary deals,which suits our approach,” said Bickle.“And there tends to be less debt, moreequity, meaning you have to put moreof yourself into the company. The onlytrouble for us at the moment is thatalthough many deals are now closingwith the kind of speed expected else-where, local lawyers often don’t under-stand or can’t cope with the urgency ofthe process.”

Lawyers need to adapt to anew age of private equity

EUROPEAN FORUM

There was standing room only in asession yesterday devoted to howlawyers can win new clients and

get more business from those theyalready have.

A panel including in-house counselfrom Reed Elsevier, Motorola andMetaldyne gave the audience tips rang-ing from how to dress for pitch meet-ings to the intricacies of pricing.

Getting feedback from clients afteran unsuccessful beauty parade figuredfrequently as the main suggestion forfirms about how to get better at gettingbusiness.

Consultant Ann Lee Gibson listedfailing to ask for feedback as the numberone mistake in her top five ways not toimprove performance in beauty parades.Gibson said firms should consider askingclients if they are happy to give feedbackbefore even beginning a pitch process.

Henry Horbaczewski, NorthAmerican general counsel for ReedElsevier, pointed to the increasingimportance of formal pitches in a chang-ing market, with “client mobility at anall time high and client loyalty an alltime low”.

“The three Rs are the key to gettingnew clients,” he said: “Relationships,referrals and reputation.” Keeping clientsis different, though. There the emphasis ison quality of service and responsiveness.

As few as a third of corporate counsel saythey would be willing to recommend afirm from their own roster to anothercorporate, he revealed, saying: “Life is abeauty contest that never ends.”

Horbaczewski went on to share his“pet peeves” with the audience, whichincluded nasty surprises that deny himtime to condition the expectations ofmanagement, failure by firms to allowhis team prior input on key decisions,and any big diversions from the budget.

Smaller irritants include billing that isconfusing and the failure of outsidecounsel to return phone calls and emails.These can “build like barnacles on thehull of a ship,” he warned. “Eventuallythey will bring it to a dead stop.”

According to session chairman,Logan Robinson, general counsel atMetaldyne here in the US, lawyersshould get better at exploiting personalcontacts to win business.

Speaking to IBA Daily News ahead ofthe session, Robinson said personalitycounts as much as anything when select-ing outside counsel. Because corporatelegal departments increasingly are keen tokeep parts of work in-house, even onmatters where they have also sought out-side advice, it is necessary that lawyersworking on a specific matter get on well.

Outside firms need to develop anaffinity with the client, said Robinson.

That means researching the backgroundsof individuals at the client and evenselecting specific partners from the firmwith matching interests or experience topresent in a beauty parade to that client.

It is quite probable that firms willhave lawyers already who have workedwith or gone to law school with anindividual at the client company. “Thatis something that most firms overlookcompletely,” said Robinson.

The process by which external coun-sel are appointed has changed completelyduring the working lifetime of today’sgeneral counsel, he said. In the past therewere no real negotiations when workwas awarded. “That model has largelybeen replaced. This has forced firms tobe more like suppliers of other services.”

Turning to advice for in-house counselhiring outside firms, Robinson’s top tipfor clients running a beauty parade is tofocus attention on the initial request forproposal letter to outside firms. Clientsneed to be precise about what exactlythey are looking for and should ask firmsto give details on those points, he said.

For example, staffing is often a con-tentious point: “Clients don’t want tosubsidize inefficiency.” So in-house coun-sel should ask firms to specify how theyplan to staff projects and what controlsthe client will have over any variation onthose plans once the work is underway.

Clients’ tips on getting hiredBEAUTY PARADES

“Local lawyers often don’t understandor can’t cope with the urgency of theprocess” Justin Bickle, Oaktree Capital Management

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