Solo Practice University® » Suzanne Meehle

Are You On Your Client’s Side (Part 2)

Suzanne Meehle — Thu, 26 Apr 2012 11:30:43 +0000

Last month's column on flat fee billing sparked a passionate debate. It also raised a lot of questions and had readers asking me for more details on exactly how I set my fees. So I am diving back int to he fray to go into more detail.

First and foremost, let me say that, while I am not a fan of hourly billing I also recognize that flat fee (or value-based) billing is not for everyone. Some people cannot get past the idea that if I provide a service that only takes me four hours and I bill in dollars what someone else might bill six hours for, I am "cheating" my client out of two hours. I prefer to think that I am being rewarded for being efficient, that my hourly rate would have increased along with my efficiency anyway, and that my client is paying for my level of service, not for a set number of hours of my time. But I get it. Like any system, flat-fee billing can be abused, made unethical and unreasonable. Here is how I actually set my fees, and how I do my best to avoid ethical complications with value-based billing.

I start with the Florida Bar Rules of Professional Conduct, and I suggest that you look at your state and local bar rules as well. Florida Rule of Professional Conduct 4-1.5 lists the following factors to be considered for determining whether your fee is reasonable:

the time and labor required, the novelty, complexity, and difficulty of the questions involved, and the skill requisite to perform the legal service properly;
the likelihood that the acceptance of the particular employment will preclude other employment by the lawyer;
the fee, or rate of fee, customarily charged in the locality for legal services of a comparable or similar nature;
the significance of, or amount involved in, the subject matter of the representation, the responsibility involved in the representation, and the results obtained;
the time limitations imposed by the client or by the circumstances and, as between attorney and client, any additional or special time demands or requests of the attorney by the client;
the nature and length of the professional relationship with the client;
the experience, reputation, diligence, and ability of the lawyer or lawyers performing the service and the skill, expertise, or efficiency of effort reflected in the actual providing of such services; and
whether the fee is fixed or contingent, and, if fixed as to amount or rate, then whether the client’s ability to pay rested to any significant degree on the outcome of the representation.

In my opinion, this is pretty much a road map for setting a flat fee for every matter that comes my way. First, I ask myself how much time and attention this will take, whether I have the skills to undertake the matter (and if not, what it will take to get me up to speed), and how difficult it will be for me to tackle the work. If I feel that I can do the work, that I can give the client the required time and attention, then I start with a baseline of what I think I would bill for the work if it was billing by the hour.

Next, I ask whether this matter is going to be ongoing month-to-month project or whether it is an isolated one-off project. For ongoing, months-long projects, I like to offer my clients the option of putting me on a monthly retainer for the duration of the project. If it is a one-off project, I break down the tasks of the project and determine what it will take for me to get them done. I have to make an educated guess as to how much time and attention the project will require. If the project will require most of my time and attention for a day/days/weeks/ a month, then I know I will be unable to accept other work, and I have to factor that into my fee.

The rate customarily charged for the same service in your geographic area is a factor you have to consider. That means that you need to be aware of what someone billing hourly for the same service is likely to charge. If I have done a lot of similar work for previous clients, I know I can charge what I have charged others in the past for the same work. If not, I ask other lawyers I know well enough to get a candid response to share how long they think this would take them and what their hourly rate would be for this particular service. That helps me to know if I am within bar guidelines. That is, is the total fee I am charging for the service reasonable compared to what others charge in my market area? I do not have to base my fees on what others charge, but it helps to know whether my original analysis is even in the same ballpark as my competitors.

Since I mostly do transactional work for small business, the significance of the subject matter to the client is generally a question of what impact my work will have on the client's business. However, this rule permits an attorney to offer a lower fee for litigation and a "success" fee if we are able to reach an early settlement or win in litigation – a higher fee for obtaining the desired result. More on that below.

Time limitations imposed by the client are the next factor. Basically, you can charge more for getting the work done more quickly if the client needs you to rush; or if the client needs you to drop everything to clean up a mess; or if the client just needs a lot of hand-holding. In any of those cases, you will be spending more time than you originally estimated on the project. Factor that in and charge appropriately.

Next, what is your history with this client? If you already have a relationship with the client, you know what to expect. Do they have a history of paying their bill on time? That saves you time and money in collections. Do they email you with a million little questions every time you do any work for them? Factor that in. Do you have trouble getting hold of them when you need something? Factor that in too.

The next factor is you. Where are you in your career? Just starting out? You probably can't charge what I can after six years of practice, and our colleagues with twenty years under their belts can charge more than we can. Your experience, reputation and skill have to be built, but you have to start somewhere. Be realistic about the value of your experience as well as the value of your time.

The final factor is whether the client's ability to pay rests on the outcome of the representation. The thought here is that fixed fee representation in litigation is often based on the success fee model in certain types of litigation, where you can charge a lower flat fee for each stage of representation, but a higher fee (a "success" fee) if you achieve a desired result. For example, if I undertake a litigation, I generally ask for $250-500 to send a demand letter, another $1000-1500 to file a complaint, and another $800-$1500 for each motion I file and argue. If we go to mediation or to trial, I charge a per diem for preparation and attendance. I could also charge a success fee for settling the matter (or winning a judgment) at or above a certain dollar amount.

Note that I do not charge success fees because I don't handle the kind of claims that are conducive to charging a success fee, such as personal injury or medical malpractice claims. I do not feel that the breach of contract and intellectual property litigation I sometimes handle lend themselves to success fees. I need my clients to make a business decision when it comes to settling or proceeding with litigation, without my fees being that big of an issue. It should also be noted that, if you could not take the matter on contingency, such as a divorce matter, then you should never take a success fee either.

So there you have it: a method for determining a flat fee that is fair to your client and ethical in practice, straight from the bar rules. I know that there are other factors that other attorneys consider, but this really is how I analyze my fees on a case-by-case basis.

Written by Suzanne Meehle

Are You On Your Client’s Side?

Suzanne Meehle — Thu, 29 Mar 2012 11:30:19 +0000

In case you haven't noticed, I have beef with the whole billable hours thing. I have heard all the arguments in favor of billing by the hour, and I have heard all the arguments against it, and at the end of the day it comes down to this: whose side are we on anyway? Under the Rules of Professional Conduct, we are to zealously represent our clients' best interests at all times. How can racking up higher and higher fees, with no end in sight, be in the clients' best interests?

At Big Law, my value was calculated in six-minute increments. The more .1′s and .2′s I put on my time sheet, racking up higher bills for my clients, the more valuable I was to the firm. Well duh! You HAVE to be a profit center in order to be a valuable employee to any business, much less a law firm. And if the law firm's model is billing by the hour, you are only as valuable as the number of hours you bill. There was not much incentive to be efficient, to do excellent work or provide value for each second that you billed. At the end of the day, no matter how good a lawyer I was, if my production of billable hours was not so good, I was considered not as good a lawyer as a coworker who did sloppy work but racked up the billable hours. That's the game.

I began to resent my time sheet and what it represented. My clients were almost uniformly unhappy with their bills. Some accused the firm of gouging them. Others fired the firm and went elsewhere. Some stayed with us, but were very guarded about how we billed our time. I watched others go out of business as they struggled to keep up with the mounting legal costs.

That's how I learned that the billable hour was the enemy of the lawyer who truly has the client's – rather than her own – best interests at heart. It was not in my clients' best interests to agree on an hourly fee with no idea of how much time it would take to do the work.Hourly billing is, by its very nature, open-ended and skewed in favor of the lawyer. The client never knows exactly what the bill will be until he gets it at the end of the month. The lawyer has a strong incentive to bill more hours to the client, not to get the work done quickly.

All of which is why I ditched the billable hour when I went out on my own. Never mind the freedom from having to track every second of my day. The true beauty of my billing method is that it is always an arms' length negotiation. I tell the client what I am willing to do for what fee, and if the client disagrees with the fee they have a choice: go elsewhere or negotiate a lower fee for less service. This negotiation is up front, before services begin.

Once the client and I have reached an agreement, our interests are aligned. I collect from the client up front and put the money in my IOLTA trust account. It stays there until I have completed the work, at which point the fee is earned. So the client has some skin in the game because they have paid in advance. I am not paid anything until the work is complete, so I've got some skin in the game as well. It is in both the client's and my own best interests for me to do the work well and as quickly as possible. I find that this method works well for everything from forming a new corporation to drafting a will to litigation.

Yes, I said litigation. While I do not consider myself a litigator, I do sometimes go to court on behalf of my clients. When I do, I do not bill by the hour. Instead, I negotiate a fee for each phase of representation and we go from there.

When I was in a partnership (between Big Law and Solo), my partner was a litigator who insisted that flat fee representation would not work for litigation because, "You have no idea how much time it will take or how much work will be involved." I don't dispute that you do not know how much time will be involved with a litigation. I do dispute that you don't know how much work will be involved. I charge a fee to send a demand letter. Another to file a complaint and serve summonses. Another to file a motion. Another to appear in court or attend a deposition or mediation. I break it down sufficiently so that my client isn't blind-sided by my bill. They know in advance what the fees and costs will be to handle each phase of representation when we get there. And if something truly unexpected comes along, we will negotiate a fee for handling that as well.

The funny thing is, I'm not cheap. I probably charge something comparable to most of the Big Law firms for similar services. But that's not the point. The point is that my clients know what the fee will be up front, before the work gets started. My interests are aligned with my client's interests. And I am free to zealously represent them without my invoice getting in the way.

Have you given up the billable hour? Do you do unbundled representation? How have you handled litigation which lawyers say 'can't be unbundled'?

Written by Suzanne Meehle

The Immutable Truth About Going Solo

Suzanne Meehle — Tue, 13 Mar 2012 11:30:13 +0000

As I got ready for work this morning, I found myself enumerating the things I absolutely MUST get done before Friday:

Revise contracts for Clients A and B;
Client C's corporate documents are way past due;
Client D's trial brief has been overlooked for far too long;
Get the process server to serve the summons and complaint for Client E;
Don't forget about Clients F, G, H, I, and J;
Review engagement letters and fee agreements to be sent to half a dozen new clients;
Drive to Tampa today for the Law Alumni Association happy hour for February bar exam takers (I'm the organizer, so I better be there);
Contact the caterer, entertainers and venue to confirm everything for the Judicial Reception I'm co-chairing for the Central Florida Association for Women Lawyers;
Call the dive shop to set up the Alumni Association dive trip I'm organizing for April;
Confirm the last speakers for the CLE seminar the Alumni Association is organizing in May (featuring none-other than Susan Cartier Liebel);
Follow up with the people I met at last night's networking event and send a thank you note to our hostess;
Write my March email newsletter, draft at least one new blog post and post updates to Facebook and Twitter;
Sit down with my husband and decide what we are going to do about some needed repairs to the house;
Drinks with two of my best referral sources tomorrow night; and
Arrange to have my 19-year old cat, Othello, who has terminal cancer and is hanging on by a thread, euthanized.

Yes, I am so busy that "euthanize the cat" has to be a To Do list item rather than just doing it when it's his time to go, which, honestly, should have been over a week ago. No, I'm not particularly proud of that.

It seems I have done it to myself again. I have dug a hole I can't possibly climb out of, making myself so busy that I cannot begin to get even half of what needs to be done accomplished, even with the able assistance of my assistant, Wendy (who will follow-up with people on my behalf and has commandeered my calendar and to do lists to make sure nothing falls through the cracks) , and a very helpful and understanding husband, Tim (who will handle the cat situation, call the dive shop for me and doesn't mind me being at social networking events three nights a week).

When I was at Big Law, I was probably the busiest associate they had in terms of putting myself out there. I was active with local voluntary bar associations and actively marketed myself and the firm to prospective clients and referral sources, and I did a pretty good job of making it rain for a newbie associate. Those marketing habits – learned from previous entrepreneurial efforts long before I ever thought of going to law school – served me well then and they serve me well now. Trouble is, putting yourself out there leads to over-committing your time. You volunteer as a committee chair one year, and you are still chairing that committee five years later. You agree to serve on your alumni association's board, and next thing you know you are organizing events for the association. You befriend referral sources, and they want to spend time with you. And I'm definitely like an Octopus, tentacles into too many things!

When exactly is all that client work you brought in supposed to happen? When I was at Big Law, it got done early in the morning and late at night. These days, that has not changed a bit. I do get client production done, but not as speedily as I would always like or in the quantity I strive for. Not looking for advice here – seriously, I KNOW what's the problem – just stating the facts.

When I left Big Law, I gave up the good and the bad of a big practice and embraced the good and the bad of a solo practice. The one constant between those two is me, warts and all. I can try to be the best version of myself all the time, but I'm still going to be me. I'm still going to have that tendency to over commit. I'm still going to run rings around myself trying to get it all done. I have come to accept that I will never be caught up. It's just not in me.

That's the immutable truth of going solo. You can hate Big Law all day long, and it won't change the fact that you've got only yourself to blame for your failures and shortcomings, and no one to praise for your successes, but yourself.

Written by Suzanne Meehle

What Happens When You Have a Good Problem – You’re TOO Busy!

Suzanne Meehle — Tue, 06 Mar 2012 12:30:21 +0000

A while back, I wrote about how to handle downtime in your firm. Well, today, I'm going to write about the flip side of downtime: what to do when you are so busy you can't even take a bathroom break, much less lunch; so busy you can't hang up from one call before the phone starts ringing; so busy you forget what downtime even looks like.

So what do you do when all the marketing is paying off, when you are busier than you think you can handle. I know – what a great problem to have! But when you have that problem, it doesn't feel so great.

At Big Law, this is not considered a problem at all, at least not for an associate. What do you do? Lock yourself in your office and bill away the hours! Bill bill bill! You have to do that when you are a solo, too, to some extent; but add to that all the administrative stuff for which you no longer have a staff, like processing payroll, running to the bank and the post office, marketing your services, managing your trust account and answering that phone that keeps ringing off the hook.

Nonetheless, first things first: you've got to do the client's work if you ever hope to get another client, but you've only got so many hours in the day. This is more than a time management problem. It's a client management problem.

Manage your clients and the work will get done… and all that other stuff will get done too (including writing that SPU column!) without losing your mind in the process.

The first thing you do, if you want to manage the client instead of letting the work manage you, is communicate with the client. Client's can handle you running late on their project most of the time. But what they can't handle is not knowing that you are in fact working on their project at all. Let them know you have not forgotten them and they will be much more forgiving of your tight schedule.

The second thing you do, and it is just barely second, is to set client expectations at a realistic level. Let them know that you are working on their project, yes, but that in order to give their project the attention that it deserves you will need a certain amount of time. Make sure that the time frame you give them is realistic, because they will hold you to it.

The time you give the client for when the work will be done must be based on your workflow, taking into account all the other work in the pipeline that you realistically need to get done in that same time frame. So the third thing you need to do is keep a To Do list just of client production that needs to get done. Mine is kept in Things software on my Mac, iPhone and iPad, so I have it everywhere I go. I can always look at that To Do list and know exactly what work is pending before I make a promise to a client about when their work will be done.

The next thing you have to do is keep a calendar of the work you are getting done. Whether you are doing transactional work like me or you are a litigator, ALL of your work should be on your calendar each day. This not only helps you track your time (if you bill by the hour) and keep your docket (if you are a litigator), but it helps you to make sure that you spend significant time each day on client production. It also ensures that, if you don't get to this client's work today, you will put it on the calendar for tomorrow so that it will get done. Take the time in the morning to plan what you will work on that day, and I promise you will get more done every day. (For details on how to do this, see Bill Jawitz's Productivity Bootcamp.)

Next, you have to do the work that's on your calendar each day. That means setting aside some time in the morning and afternoon to deal with email and voicemail, putting your phone on "Do Not Disturb," and closing your office door. You need uninterrupted time to do the work. Do all your work as well as you can the first time. Then put it down and move on to the next scheduled task, whether you are done with it or not.

Next, read the work you've done. All of it. Out loud, preferably, since you catch more mistakes that way. Always run your word processor's spelling and grammar check. Try your best to catch your typos, omissions and mistakes before the client does. Clients will forgive an occasional typo, but they hate sloppy work. Give them your best efforts, even if you have to take an extra day to do it. The time you spend doing this will more than make up for the time you will spend fixing mistakes later on.

Finally, communicate with the client again. Let the client know where you are at on their project if they were on your schedule for the day. Let them know if the work is in progress but not yet complete, or if you have a final draft that you will get to them in the morning (so you can review it one more time tonight). Like I said before, communicating with the client is the key to managing the client. And managing the client is the name of the game when you're busy.

I am not perfect at doing all of this, I admit. I sometimes let the amount of work that needs my attention overwhelm me and I get off track. But I DO know that being busy is a blessing, not a curse. And I also know that if I get back on track with the basics of client management, I WILL get everything done that I promised.

Written by Suzanne Meehle

The Best Damned Fee Agreement You Ever Wrote!

Suzanne Meehle — Thu, 23 Feb 2012 12:30:56 +0000

We all remember the lecture from the Professional Responsibility class we were required to take in law school: ALWAYS use a written fee agreement!

In addition to the obvious – a well-drafted fee agreement helps you avoid a bar complaint later on – putting your terms and conditions in writing is just common sense. Yes, our grandfathers did deals on a handshake and their word was their bond. Sure they did! And then there was a lawsuit over what exactly was agreed upon. There's a reason the ABA Model Rules of Professional Responsibility include eighteen rules regarding the Client-Lawyer Relationship.

I was as guilty as the next lawyer: I used to use an engagement letter based on one I used at my former Big Law employer. It had all the basics covered – what the fee was, how billing is handled, and who was responsible for the work. It didn't cover much else, but it was about seven pages of legalese that sounded good and looked pretty important, and I figured it would protect me.

Until I kicked into contract review mode, that is. I realized a few things were missing, others were overly broad or vague, and that the most basic tenants of contract drafting were not followed. How could I ask clients to hire me to write contracts for them if the very contract I handed them to enter into with me was unintelligible at best.

So I started tweaking it. I based my current fee agreement on a letter agreement for services which I drafted for a client. It is written in plain English with little to no legalese. It is also relatively short – four pages – and includes a separate detailed Scope of Work. And it clearly delineates parts of the agreement using headers. I'm not done tweaking it, but I've gotten my fee agreement pretty close to my ideal.

I won't give you a copy of my fee agreement, mostly because it probably wouldn't be of much use. You really have to tailor it to the way you run your practice. For example, I say that I want my clients to take advantage of my client portal for secure communication. You may not offer that. In any case, what I can do is outline roughly what makes up a good fee agreement and encourage you to look yours over with a critical and nuanced eye.

Scope of Work

The Scope of Work section of any fee agreement is crucial. It outlines the initial proposed work the firm will do and the fee it will charge for that work. Mine also includes any additional recommended work that we may have discussed but which is NOT included in the original Scope of Work. This helps avoid confusion as to what is and is not included in the fee, and it prevents "scope creep." Scope creep is what happens when a project starts getting incrementally bigger as the needs of the client expand during the course of work. Inevitably, unless you provide a detailed Scope of Work making it clear otherwise, the client expects to get that "extra" work for free as they will assume it is included in the Scope of Work. Also, be as clear as possible about what you will charge for the work. If you are charging a flat fee plus costs, enumerate the costs so your client knows what is expected. If you are billing by the hour, say so clearly in your Scope of Work. If you are billing on contingency, make that crystal clear, twice.

One more note about the Scope of Work: you should be able to append additional scopes of work to the agreement and the agreement will remain binding as amended by such scopes of work. That way, one agreement is all you ever need with that client, even if you raise your fees later on.

Other sections correspond to one of two categories of things you should address in your fee agreement: things that you ought to always have in a contract; and things you should put in your contract because of bar and/or court rules.

The things you should have in every contract you draft, and therefore also belong in your fee agreement, include:

choice of law, jurisdiction and venue in case of litigation;
a mediation or arbitration requirement (as appropriate);
a merger clause that makes it clear that this is your entire agreement and supersedes any prior agreement;
a termination clause stating that the client may terminate you at any time, and under what circumstances you may terminate the client; and
a statement that the agreement may only be amended in writing signed by the parties.

The things you should have because your state bar association requires it will vary, but I have the following:

a statement regarding client confidentiality and a separate statement regarding the unconfidential nature of certain electronic communication;
a statement regarding handling of amounts placed into my IOLTA account for safekeeping;
a statement that a conflict check was performed and the results thereof;
a statement that the client is responsible for costs and fees; and
a statement regarding the firm's billing practices.

Each statement is brief, but I try to address every concern raised by those eighteen rules regarding the Client-Lawyer Relationship!

In the event that you perform work on a contingency fee basis, be sure to double check your bar association rules. In Florida, for example, we have a statutorily-required statement that we must attach to contingency fee agreements (which MUST be in writing) that outlines the client's rights.

Additionally, at least here in Florida, when a litigation matter concludes, whether by settlement or through judicial process, you and the client (and any referring counsel with whom you have a formal fee-splitting arrangement) must sign a Closing Statement that shows a breakdown of all the moneys paid, attorney's fees and costs before you disburse any funds. That is probably worth mentioning in your fee agreement.

Again, this has been an on-going process tweaked for my practice needs, tailored to my clients and for compliance with the rules of my jurisdiction.

The key point is: all fee agreements need to be reviewed on an on-going basis. Don't just assume because someone else has used theirs for years without incident that it will work for you, your clients or your jurisdiction.

I'm sure you have thoughts on this, questions, contributions based upon your practice area or jurisdiction. Please share!

Written by Suzanne Meehle

Take Your Best SWOT!

Suzanne Meehle — Thu, 09 Feb 2012 12:30:07 +0000

I am blessed to have a couple of law firms as clients. These are, by and large, lawyers that do not specialize in business law (as I do) or maybe really didn't know much about running a business when they hung a shingle. I say I am "blessed" because lawyers make really wonderful clients. They understand that this is how I make my living, and they don't tend to waste my time.

Recently, I was approached by a friend, a solo lawyer who was looking at renting space in my office building. He has been focused mostly on raising his two small children, and only recently decided to put more into his practice. His confusion, he said, was whether to put the money into a brick-and-mortar office or whether to put the money into marketing the practice.

"What are you doing now to market your practice?" I asked.

"Nothing, really," he said. "I don't even have a web site."

Nor did he have a defined set of practice areas ("whatever walks in the door" not being a practice area), an idea of what an ideal client looked like beyond "paying," or even an established place to work in his home. He had been meeting clients at Starbucks or borrowing my conference room as needed, but without a plan for how he was going to serve those clients.

I sent him home with some homework: "I want you to do a SWOT analysis on your business," I said.

"A what?" he replied.

"A SWOT analysis," I answered. "An analysis of your Strengths, Weaknesses, Opportunities and Threats," I added as I drew him this chart:

"I want you to write down what you feel are your firms greatest strengths under, 'STRENGTHS,'" I said, "then put the greatest threats under 'THREATS,' and so on with your biggest opportunities and your biggest threats."

"Ah, I think I remember doing this back in business class in college," he said.

"Yes," I said, "only this time you are doing it for your law firm, not just as a hypothetical. This is where you start your business plan."

"You need to do an assessment when you are done making your SWOT chart," I continued. "How will you use your strengths to address your weaknesses? How will you leverage your opportunities to lessen your threats?"

That, you see, is what my friend was missing. He had done no analysis of his business, so he had no idea where he was going with it. How would he know where to best put his money – office space or advertising – without knowing what weaknesses or threats he needed to address?

For example, I know that one weakness I have is that it is just me – I'm the only attorney, so there is no one to pick up the slack if I have an off day or if, as I find myself lately, I am swamped with more work than I can get done in a day. To address that, I knew hired my assistant, Wendy, for a few more hours each week to give me less time doing administrative tasks and more time for client production. So I addressed a weakness (being too busy to get it all done) with a strength (Wendy is an AWESOME assistant!).

Similarly, when I planned my business, I knew that there were plenty of business transactional attorneys in this town. So I addressed the threat of having lots of competition with an opportunity: I specialized in small businesses and offered my services on a flat fee basis, differentiating myself from a typical business lawyer.

A SWOT analysis will help you to find focus for your law firm as a business. Because if you are a solo attorney, you run a business, not a law practice. "Legal work" is your product. Your business is how you make and sell that product. Don't confuse the two.

When I was at Big Law, I never had to worry. I was a part of a law practice factory, cranking out the work and letting someone else worry about the business. My boss, the firm's managing partner, was very, very good at what he did, which was hiring associates to do the work while he "made it rain," oversaw the bookkeeping and made sure the lights stayed on. I will admit, when I first went out on my own I did not give enough thought to whether I wanted his job as well as my own. But when you run your own firm, you are the business manager, the marketing manager, the rain maker and the work producer. It is vastly rewarding, but you had better know that you are in business or your firm will fail.

Whether or not you ever do a formal business plan, I strongly encourage you to do a SWOT analysis at least every year or so to make sure you know where you are going and how you plan to get there, what you are up against and how you plan to survive in spite of it.

My friend called me back on Friday to thank me for making him do his homework. He has a better idea of what direction he needs to take his practice in, and asked me to work with him on a low-cost marketing plan. In short, he now thinks of his law firm as a business, and I think he's going to be OK.

Written by Suzanne Meehle

Making the Leap From BigLaw to Solo Practice

Suzanne Meehle — Thu, 26 Jan 2012 12:30:23 +0000

I've talked a lot on this blog about the differences between BigLaw and Solo. What I haven't spent enough time on is what it took to make the transition from BigLaw to Solo.

How exactly did I make the leap?

First and foremost, I got fed up. Yes indeed. I had to hate being a cog in the BigLaw machine badly enough to give up what there is to love about BigLaw. Because, really, there IS a lot to love. I loved my co-workers, who were among the best and most talented attorneys I've ever known. I loved having a huge support staff. I loved having people nod in satisfaction when I told them what firm I worked for. I loved getting a regular, fat paycheck. And I seriously loved breaking down a few barriers: I was the first person from my law school that was hired into my old firm; and while I worked there we had more women associates and partners than at any other BigLaw firm in town I can think of. Not too shabby.

I really loathed what I didn't like about BigLaw. I hated being measured by the number of hours I billed over the quality of my work. I dreaded having to collect on some pretty outrageous bills racked up by some of my clients who needed a little hand-holding. I despised feeling that what I contributed to the firm made little difference. And I hated being metaphorically thrown in the deep end of the pool without swim lessons – practicing a new areas of law by the seat of my pants and hoping I didn't screw up so badly that a client or a partner would notice.

That last one – that doesn't go away when you go solo. You are still flying by the seat of your pants, but at least you have control over the direction. You can control what clients you hire, what work you take on, what CLE you take, what treatises you buy and read, and what forms you use as a jumping-off point.

But I grew to hate my job at BigLaw more than I feared hanging a shingle. And boy howdy, was I ever afraid! It took me more than a year after I knew I didn't belong at BigLaw to screw up the courage to leave.

Hanging a shingle meant, as a good friend put it, "saying 'F*** you!' to the cliff and jumping into an abyss."

I talked to everyone who would listen about my growing dissatisfaction with BigLaw. I started reading about so-called "alternative" ways of practicing law, and eventually started taking classes at SPU. I saved my pennies and wished for the day that I could finally walk away from my job at BigLaw. I commiserated over lunch, on the phone and via email with a good friend about how much we wanted out of BigLaw.

And then it happened: the director of Human Resources walked into my office and handed me a self-assessment form in preparation for my annual review. In filling it out, I realized that my honest answer to most of the questions would get me fired from BigLaw:

How would you rate your performance? Pretty lackluster of late, because I hate coming to work in the morning.
How would you rate your legal abilities? Better than average, but I really don't know since I'm the only lawyer in the firm who does what I do, even though I've only been here for three years.
What are your goals for next year? To not be here by the end of the year.
How would you rate your loyalty to the firm? See #3, above.

I absolutely could not be honest in my self-assessment and keep my job. I knew right then that I had to leave. Now. Right now!

On the drive home that night, I called my friend and soon-to-be business partner to schedule a lunch where we hatched our escape plans. We were giving notice the following week, and we would open our firm on the first day of the following month. We each thought we could attract a few of our existing clients to come with us, which would give us a much-needed push-off. We could operate on a shoestring budget. I threw together a rough sketch of a business plan and we hired a marketing firm to help us figure out that piece of the puzzle. We set up a professional limited liability company. We each borrowed start-up money from our respective families. We found a small office to rent. In short, we did a few things right and made a few mistakes.

We did OK borrowing the money, but we should not have spent it on a marketing firm. We did well starting with a business plan and a shoestring budget, but we should never have leased space right out of the gate. We attracted clients right away, and we were right that we could survive without BigLaw salaries and perks. We eschewed practice management software at our peril. We underestimated the need for a clear operating agreement. We overestimated the power of a good friendship to translate into a good business partnership. We learned. Eventually we broke up the firm and went our separate ways.

This time I did a few things differently. I started out in a home office for six months, and did not lease space until I had outgrown my existing space. I did my own marketing: I set up a website using WordPress so that I had control over the content and search engine optimization ("SEO") that drives traffic to the site; I ordered business cards and letterhead on the cheap; and I networked my butt off. I immediately signed up to use Clio's practice management system. I took every SPU class that seemed vaguely relevant to my practice. I paid off what I owed to my family for the loan to set up my first firm, and I now operate in the black. My business plan is a constantly-evolving, but I'm still on a shoestring budget.

Now, having transitioned from BigLaw dropout to successful solo, I am happy.

There is nothing wrong with working for a BigLaw firm. But if you are dissatisfied with your job at BigLaw, I have some advice: say "F*** you!" to that cliff and jump!

Written by Suzanne Meehle

Lessons Learned From a Hard First Year of Solo Practice

Suzanne Meehle — Thu, 22 Dec 2011 11:30:30 +0000

One year ago, in December 2010, I hung out my shingle as a solo. I thought I would look back on that year and the lessons that I learned.

First and foremost, I learned that I can do this! When I initially left Big Law, I was convinced that I needed a partner, that I wasn't "enough" on my own. I doubted that I could be the rainmaker, the bookkeeper, the janitor AND the lawyer. In fact, I have had a much easier time of it as a solo than I had with a business partner. Nothing against my former partner, mind you, as our break-up was very mutual. But I as I left that practice behind to start this one from its ashes, I realized that I was much stronger than I had given myself credit for. If I ever take on a partner again, it will be because it makes business sense, not because I think I need someone else to prop me up.

I learned that I like having a brick & mortar office. This one really surprised me. I have a virtual office that lets me work anywhere, but I choose to do most of my work in my office. I started out with a home office and I was very proud not to need a separate office. I was high-tech, location independent (nomadic, even) and I was doing fine. In fact, my clients often chose me because I was a virtual lawyer. But there was also a LOT of people who wanted to meet me, face-to-face, in my office. I learned very quickly that I was not entirely comfortable inviting strangers into my home on a daily basis. For one thing, the house had to stay spotless, and with two animals (a dog and a geriatric cat) I suspected that there were smells to which I had long since grown accustomed. For another, well, you just never really know who the client is till they show up. Plus, I had hired part-time help, and my tiny office was getting crowded. The final determinant, however, was that my "dream" location became available: an office in a converted historic Victorian home within walking distance of my house. I come to work every day looking forward to climbing the steep stairs to my office on the third floor. My space has a homey, comfortable and professional feel, and I have more privacy.

I learned that having a brick & mortar presence does not mean you give up on a virtual practice. I still have many clients whom I have never met face-to-face. I have many others that I meet face-to-face only occasionally and do all of their work in a virtual space regardless. And I love the luxury of taking my work with me when I travel. Having a virtual practice made it possible to work from my mom's house when she was ill, to stay with my sister when she got out of the hospital and still get the work done, and to keep my business alive while tying up loose ends after my mom passed away. I even got some work done in November when I was in the hospital for three days following surgery! In short, having a virtual practice was the main reason I still have a practice with everything I've gone through this year.

I learned not to waste money on marketing. I got suckered into signing up for law firm marketing contracts. You know the ones: big research companies also offer marketing packages to improve your search engine optimization ("SEO") and promise you'll get more leads through their online directory than any other way. It's total bulls$&t, pardon my French. I have not seen one dime of return on that investment in a year – not even a single lead. Don't fall for it.

I learned not to waste money on other things, too. Like memberships to networking groups, ads in local home & leisure publications, and fancy extras like all the add-ons my phone company offered me or hiring a decorator to fix up my office. Instead, I got involved in the bar associations I'm already a member of, switched my phones to a bare-bones system, fired my answering service and decorated my office with used furniture off of Craig's List. The leaner you run your firm, the easier it is to pay the bills each month and still take home a paycheck.

I learned where my leads actually come from. I get at least half of my clients from referral sources like other attorneys and existing clients. So guess where I put my marketing time and money? Into taking those referral sources to lunch. I am also starting a seminar series for my existing clients to build on their referrals.I also get a lot of referrals from a local business mentoring organization, so I volunteer with them as a speaker. The rest of my clients find me online through my own website. More on that below.

I learned how to get clients through my website. You want better SEO? Translation: do you want your website to stand out on Google? Learn some basic ins and outs of how the Internet works. Use a back-end to your website like Joomla or WordPress that automatically handles it for you. Figure out the keywords that people will actually put into search engines to find a lawyer like you, then stick them into the "keywords" box in your web site back-end. Use multiple pages – one for every practice area. Update your site regularly with fresh, relevant content. Lather, rinse, repeat. Because what works to drive traffic to your site is going to change day to day.

I learned how much money I need to stay afloat. I wrapped my head around my own cash flow, and figured out how to bootstrap my law firm the same way many of my clients bootstrapped their businesses. It's not easy, and some days I wonder if I can survive the latest cash flow crunch. But my bottom line is healthy, my bills get paid, and I am taking home a paycheck each month. Not too shabby for my first year!

I learned that I can do it all myself, but that I don't have to. I'm no longer a one-man band. I have hired and fired a few people this year, including a couple of file clerks, a law clerk, a paralegal and, well, a widget. Yes, a widget. That is the job title I gave to my part-time assistant/file clerk/paralegal/receptionist/IT staff/janitor/Girl Friday. Her name is Wendy, and I worked with her at Big Law. I share her with another local attorney – I have her mornings on Tuesday through Friday, and he gets her Mondays and Tuesday through Friday afternoons. Having a widget means that I can spend more time on marketing and lawyering, and less time on administrative stuff. And I love it!

Finally, I learned to love my life, right now, just as it is. My life is not perfect, don't get me wrong. It would be nice to be a little more profitable, but the firm is beginning to thrive. I love coming to work here every day. I love my office, my building and the other tenants here so much that I helped host a Holiday Open House here last week. I have a fantastic marriage to the most wonderful and supportive man I have ever known. I have a great house, right down to the shedding dog and the smelly cat. I have the love and support of my siblings and a strong network of friends. In short, I have no reason not to succeed and no reason not to be happy. Life is good.

Written by Suzanne Meehle

Why People Hate Lawyers: Getting Beyond The Stereotypes

Suzanne Meehle — Thu, 01 Dec 2011 13:30:21 +0000

We've all heard the jokes:

Q: What is black and brown and looks good on a lawyer? A: A doberman.

A client who felt his legal bill was too high asked his lawyer to itemize costs. The statement included this item: "Was walking down the street and saw you on the other side. Walked to the corner to cross at the light, crossed the street and walked quickly to catch up with you. Got close and saw it wasn't you. -$50.00."

A reporter outside of a courtroom asked a defendant clad only in a barrel: "Oh, I see your attorney lost the case!" The defendant answered, "No, we won."

Q: When lawyers die, why don't vultures eat them? A. Professional courtesy.

I know. Ha. Ha.

But clichés and bad jokes come with a kernel of truth. There is a reason people hate lawyers. We have met the enemy, and it is us.

So if you don't want to be the butt of the joke, ask yourself if you fit any of these "bad lawyer" stereotypes:

1. The Rich Lawyer. Oh how people hate us BMW-driving, billable-hour chasing, money grubbing lawyers. But most of the lawyers I know who drive fancy cars or live in big houses fit into two camps: 1. the lawyer who has paid her dues and really can afford a little luxury; and 2. the lawyer living beyond his means. The first one, well, they earned it. We may all aspire to be this kind of lawyer – one who has worked hard, served their clients well and can genuinely afford the Beemer. But too many of us are pretenders, faking it before we make it and chasing after the big bucks so we can pay the bills. Be who you are, and quit chasing money as the be-all/end-all of our profession, and you may earn enough respect to eventually become what you aspire to.

2. The Ambulance Chaser. Yes, we all have to make it rain. Clients don't find us by themselves – we have to go get 'em. But if you are so desperate for clients that you will take any case that comes your way, even if you have to wait all night in the ER, you my friend are an ambulance chaser. Work on building a referral network and do a great job for your existing clients and watch your business grow. And remember, you don't have to take every case that you come across. Just take the ones where there are genuine issues to litigate or a real need to be served.

3. The Unethical Lawyer. We've all met lawyers who think that the rules don't apply to them. They seem to get away with murder while the rest of us fret over every detail, so afraid of a bar grievance it is a miracle we are willing to give advice at all. Don't be "that guy." Because while most of us never get a bar grievance in our lawyering lives, if you don't respect the rules that govern our profession, it will catch up to you.

4. The Stupid Lawyer. I honestly have never met a genuinely stupid lawyer, but I have heard rumors. Lawyers who never update their forms, never research issues for their clients and genuinely remain ignorant of the law as they continue to practice. That just won't do. Stay on top of the legal issues in your practice areas, and keep current on technology and business practices. Then you won't be just another stupid lawyer.

5. The 24/7 Lawyer. You know this guy: the lawyer who never goes home, bills 3,000 hours a year and has no life. If this is you, you need a vacation and some friends because you can't do this forever. Your clients can literally smell the burnout coming out of your pores, and your kids don't recognize you. My advice? Back away from the Westlaw and get some fresh air.

6. The Bad Lawyer. What can I say about the stereotypical bad lawyer that hasn't been said in a million lawyer jokes? He doesn't follow rules of procedure, takes on new practice areas like he is buying cheap suits, and forgets to call or email clients to keep them up-to-date on the status of their cases. They miss filing deadlines and keep a sloppy calendar. If you suspect this is you, I encourage you to do ANYTHING but practice law.

7. The TV Lawyer. You know who you are. There is nothing wrong per se with advertising your services at bus stops, on billboards or even on TV. The guy I'm talking to is the one who runs a mill. Clients never actually meet their attorney unless they see them in court once in a while. They have a cadré of associates cranking out the billable hours, while paralegals and "case managers" actually meet with clients. And the guy whose face is on the billboard waving cash at passing drivers? He's too busy running a business to practice law. Don't be this guy. Refuse to work in his mill.

8. The Pitbull. Typically, this kind of lawyer is the butt of divorce jokes. But any kind of litigator will fit the bill if she is overly aggressive and does not respect the decorum of the courtroom. There is no need to be a pit bull; you can zealously represent your client without resorting to being nasty. Just tone it down, follow the rules of professional conduct and put the "civil" back in litigation.

9. The Good Ol' Boy. "A good lawyer knows the law. A great lawyer knows the judge." If you think that the good old boys' network you and your daddy and your daddy's daddy practiced law with will get you by, think again. There is a glut of new lawyers coming out of law school every year, and most of them are women. When I was at Big Law, I knew the beginning of the end of the Good Ol' Boy was there when the son of one of the most respected lawyers in town got laid off. The times they are a-changing, and you'd better get with the program.

10. The Ghost. You can't reach this lawyer by phone, cell or email. They are completely, utterly inaccessible once they take your case on. You will never know the status of your case. Do not pass go. Do not collect $200. If you are one of these elusive creatures, take this as your wake up call: you will be grieved.

William Shakespeare famously wrote: "The first thing we do, let's kill all the lawyers." Henry IV, Act IV, Scene 3, one of the earliest recorded lawyer jokes. In context? These are instructions for seeding anarchy. Lawyers are supposed to be bastions of a civilized nation, ensuring justice for the people we serve. Most of us actually try to be that kind of lawyer. But not all of us.

If lawyers are ever going to stop being the butt of jokes, we need to stop acting like jokers.

Written by Suzanne Meehle

Referring Like a Big Dog When You’re Still The Puppy on The Block

Suzanne Meehle — Thu, 27 Oct 2011 11:30:04 +0000

These days, it doesn't pay to take whatever work walks in the door. Jacks of all legal trades find themselves masters of none. Clients need *specialists* (not being used in the 'not allowed' designation unless you are certified as a specialist) who know their niches very well. They come to you with a problem that is specific to your practice area. But what happens when their needs exceed the scope of your practice?

One of the things I miss most about being at a Big Law firm is the built-in network of peers. Don't have any experience with zoning law? No problem – there's a department that handles land use right down the hall. Does your business litigation client have a tax question? Call someone down from the Corporate Department, stat!

As a solo, there is no reason you can't build that same advantage for yourself. Instead of the Corporate Department down the hall, look for the corporate lawyer across the street.

You have to build your own network of go-to people to help with those situations. Get to know people whose specialties differ from yours substantially. As a small business lawyer, I specialize in basic business law: entity formation, leases, contracts, asset and stock sales/purchases, and intellectual property. I don't do much tax work, for example, because the majority of my clients don't go to a lawyer for tax preparation – they go to their CPA. So I keep a friend with an LLM in tax on speed dial for when a tricky question arises.

Other specialists every lawyer should have close ties to include:

a family law attorney;
an estate planning and probate attorney;
a personal injury attorney;
a criminal law attorney
a real estate attorney

Why those five? Because you will have clients who need all of those specialists at some point in your career. And if your practice area is particularly nicer (like, say, environmental law) you may need a completely different list. In addition to my tax lawyer friend, for example, I keep a commercial litigator on speed dial.

I strongly recommend that you choose fellow solos and small firms to refer your clients to. First of all, you won't have to worry about the other firm trying to steal your clients away because they don't have a huge department just down the hall that practices in your niche. Second, you will be building a cross-referral network that will let you compete with the Big Law firms that do.

What you cannot do is get into a formal "I'll send you referrals if you send me referrals" arrangement/agreement. While there is a tendency to refer to firms that refer clients to you, you cannot make referrals contingent upon getting other referrals. ABA Model Rule of Professional Conduct, Rule 7.2 states, "A lawyer shall not give anything of value to a person for recommending the lawyer's services," with only a few exceptions. Referrals made for referrals given is NOT one of them! (Some states still permit fee splitting for lawyer-to-lawyer referrals and you should check on the specific rules for your state. This would permit/require a formal agreement for each individual case referred.)

What you can do is be conscious of where you refer your clients. Search out well-respected solos and small firm attorneys and take them to lunch. Treat it as a marketing meeting – only you are there to find out what kind of clients the other lawyer is looking for, not to market your services and ask for referrals. Find out if this attorney is the one you would want to be sent to if you asked for a referral. Sending your clients to the best-of-the-best in your community only makes you look that much better to your clients.

Trust that referrals will come when referrals are given, with no tacit agreement required. Send a token gift to say "thank you" for referrals you receive. Take lunch to the lawyers and their staff and see how much they appreciate it. Most importantly, though, treat the clients that are referred to you by other lawyers with kid gloves because they are gold to your practice. They WILL tell the referring attorney how you treated them, good or bad. Make yourself stand out (in a good way) from the other lawyers that they may send clients to, and pretty soon you'll be at the top of their referral list.

You might also enjoy: Always Pay Your Referral Fees. Always.

Written by Suzanne Meehle