April 17, 2007
Sub-Practice Groups: Adding Value or Just Marketing?
Posted by Christine Hurt

The WSJ Blog reports that Pillsbury Winthrop has announced that it has created a Subprime Industry Group, dedicated to representing clients in that industry facing investigation or regulation.  The question of the day for the Law Blog is whether "issue-focused" practice groups, such as back-dating sub-departments, are just marketing.  The comments are very cynical and decry these creations as mere marketing, but I disagree.

In the practice of law, new departments and sub-departments are created as the market evolves.  Pass sweeping new pension regulation and voila, you need an ERISA group.  You can think of numerous examples in the past 20-30 years.  I was part of the Project Finance Group at Skadden (actually, even more specialized, Project Finance - Energy).  This was not marketing.  That is all we did.  The attorneys in that group were dedicated almost 100% to serving clients in the energy industry with project finance transactions.  I like to think that with that expertise, we were able to serve our clients better, and in less billable hours, than a firm that did a few a year, with different attorneys working on each one.  Clients don't like to pay attorneys to reinvent the wheel, but they are willing to pay a little extra per hour for a firm they think invented the wheel.  Clients benefit from the institutional knowledge and don't have to pay even a very talented associate to learn all about X transactions.

I assume this is as important, if not more so, in litigation where every case requires attorneys to learn from scratch about a new industry and the laws applying to that industry.  If you can find a firm that regularly represents clients in that same industry, then those attorneys don't have to go up that learning curve.    Of course, these specialty groups can be more flash than substance.  If you look at some law firms' websites, they may seem to have 20 different corporate groups, but when you look at the attorneys assigned to each group, each group is 80% composed of the same attorneys.  Each attorney is assigned to about 13 groups.  That just says "our attorneys have been exposed to all these areas," which is not the same things as "our attorneys have gained expertise in particular areas."

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