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  • August 18, 2010 | Practice News
    Best Practice: Should we change our partner compensation system?
    Asked and Answered By John W. Olmstead, MBA, Ph.D, CMC Q. We are a three attorney law partnership that does primarily business transactional work. My partner and I have been in practice together for four years. We are equal partners (50% each) as far as our partnership interests and we use these same interests for determining partner compensation. In other words we receive the same compensation. We recently have been discussing whether we should look into a different method for determining partner compensation. Currently we produce about the same level of fee revenue. What are your thoughts? A. I could write a whole book on compensation systems - but here are a few thoughts:
    1. Over the past 30+ years I have seen just about every form of compensation system that there is - from "even steven" systems such as yours to "eat-what-you-kill", other formula systems, profit center systems, objective systems, etc. No particular system is better than another system. It depends upon the firm - the culture - strategic goals - and the environment.
    2. If the system is working - sometimes it is better to leave it alone. There is nothing wrong with an "even steven" system as long as the contributions (fee generation, fee origination, firm management, and otherwise) made by both of you to the firm are perceived as equal. Frequently, partners start out making even contributions and down the road contributions change (often due to life or family changes) and are no longer in alignment.
    3. When perceived contributions get out of alignment partners are reluctant to have the candid discussions that need to occur as well as changes in the arrangement or compensation system.
  • August 17, 2010 | Practice News
    Former Gov. Rod Blagojevich found guilty of lying to federal agents - jury hung on all other counts
    A federal jury today found former Gov. Rod Blagojevich guilty of Count 24, lying to federal agents, but the jury was hung on all other counts. Check back with IllinoisLawyerNow.com for commentary from veteran Criminal Defense Attorney Robert Loeb. Judge James Zagel declared a mistrial on the other counts the jury could not reach a decision on and the prosecution has indicated it will seek a retrial.
  • August 15, 2010 | Practice News
    Arkansas judges surveyed on legal writing
    Rodney P. Moore has written a nice article in this summer's issue of the Arkansas Lawyer summarizing the results of his survey of  Arkansas judges on legal writing. Although it is not online yet, I assume it will be soon. Judges are the primary readers of our work, so it may be productive to review Mr. Moore's summary of his survey.
    1. Too long, too long, too long. "More is less."
    2. "Get to the point and stay there."
    3. "Introductions and substantive headings are helpful."  This helps judges get their arms around the issues.
    4. No vitriol. To paraphrase Justice Ginsburg in her Lawprose interview, if a lawyer is a stinker, the judges will get that. Just don't go there.
    5. "Circuit judges like bullet points." (As I'm doing here.)
    6. "Don't just cite--explain."
    7. "Follow the rules."
    8. Judges like plain English. Again, more is less. Does that adjective or adverb add anything?
    9. Proofread. (Hint, read out loud. I once sent out a document opining on  "Pubic Act 93-242." Spelled correctly, yes?)
    10. "Organize your writing." Again, this helps readers get their arms around what you're saying.
    Mr. Moore's article is worth reading once it is online.
  • August 15, 2010 | Practice News
    Estate planning and Deficit Reduction Act
    The State of Illinois is proposing rules to implement the federal Deficit Reduction Act. If you do any estate planning at all, you need to click on the August 13, 2010 Flinn Report here and review the Department of Health and Family Services proposed rules. HFS has scheduled a hearing in Chicago on September 13 to take testimony before the proposed rules are submitted to JCAR (Joint Committee on Administrative Rules) for JCAR's approval.
  • August 12, 2010 | Practice News
    Legal Tech: Potential subpoena problems for Facebook and MySpace
    By Peter LaSorsa In a recent decision from the United States District Court in the Ninth Circuit, Crispin v. Audigier[1], a subpoena issued to Facebook and MySpace for messages and wall postings was quashed. Although the decision of the Court is not controlling in Illinois, I believe the logic of the decision is sound and may be followed in the Seventh Circuit. The Court applied the Stored Communications Act (“SCA”) in determining that the subpoena should be quashed. The SCA in a nutshell brings fourth amendment protections against unreasonable searches and seizures into electronic information. In the Order the Court quashed portions of the subpoena seeking private messages from Facebook and MySpace and drew the analogy that those social networking websites are electronic communication services just as email services like Google and Yahoo. The Court afforded the same protections under the SCA to Facebook and MySpace as it has with email service provides. In essence the Court is saying you can get this information directly from the parties but not from the Facebook or MySpace. The court also held that wall postings and comments are protected under the SCA either as restricted access electronic bulletin boards or because Facebook and MySpace provide storage of the comments for the limited use of a few users.
  • August 11, 2010 | Practice News
    CNN in the cafeteria: a workplace-harassment timebomb?
    You're laughing. But if you haven't read Peter LaSorsa's article in the latest issue of ISBA's The Corporate Lawyer. He recalls his days as counsel to a big corporation, which had TVs on in its megacafeteria. "A funny thing would happen each lunch hour — CNN would end with a clip showing supermodels, usually half-naked strutting down the runway," he writes. "I could usually tell by the looks of the females eating that they weren’t thrilled with what was on the television set. I often wondered to myself what would happen if an employee had a poster in his office of one of the women, half-naked just like what was being shown on television." Good question. So what about those television sets? Read his article, entitled Workplace time bombs.
  • August 11, 2010 | Member Services | Practice News
    Need a form? ISBA website probably has it
    The ISBA website has a lot of useful resources for a lawyer needing a form. Back by popular demand: we have gathered Rule 213 Written Interrogatories to Parties from the Illinois Supreme Court website for the convenience of the Illinois legal profession. For our members, we have a Form Exchange where members can take a form or leave a form for others. In our links section we also have a Form Links page with even more resources.
  • August 11, 2010 | Practice News
    Best Practice: Boosting personal injury law firm profits
    Asked and Answered By John W. Olmstead, MBA, Ph.D, CMC Q. We are a 5 attorney (all partners) personal injury plaintiff law firm in Central Illinois. We are all working hard, are extremely busy, but we don't seem to be seeing the results of our hard work in our earnings and compensation. We are making hefty marketing investments - in fact we are spending around 6% of revenue on marketing. What are your recommendations on how we can improve our profitability? A. It is hard for me to comment specifically with the limited information that you have provided. There are numerous variables that need to be examined. However, in general terms:
    1. How long have your lawyers been in practice? If over 10 years - you ought to be taking home $200,000+. Many lawyers aren't - but if they have tuned and focused their practices they should/could be.
    2. Each lawyer should be collecting $300,000+ per year in fees. If not, examine case production hours, quality of cases being accepted, effective rate per hour as well as realization. (Assumes time is being kept on contingency fee cases)
    3. Firm's margin should be in the range of 35-45%. (Net Income - excluding owner salaries divided by Gross Fee Revenue)
    4. Is the firm (high volume low dollar PI firms) investing 8-10% of fee revenue on marketing? Many high volume PI practices are spending much more.
    5. Are you measuring the ROMI (return on marketing investment)? This is critical. Not all marketing investments produce fruit - some fail. You must actively measure, manage, and fine tune marketing programs. Identify those that don't work and kill them. Dashboard reports are crucial.
  • August 10, 2010 | Practice News
    What happens when your client’s ex is still his named life-insurance beneficiary?
    It comes up often. Maybe more often than not. “Under Illinois law, a former spouse’s designation as a beneficiary to a life insurance policy is not automatically terminated upon divorce,” write Lauren J. Wolven and Ashley E. Crettol in the August 2010 issue of the ISBA Trusts and Estates Section newsletter. “Unfortunately, it is also a common occurrence that the named beneficiary is never changed following divorce." But death waits for no man. Or woman. Whether or not he or she has changed his or her life insurance beneficiary. “As a result of these two factors,” they continue, “litigation is common in this area as a result of competing claims for the proceeds of life insurance policies – ex-spouses who remain the designated beneficiary claim that they are entitled to the proceeds while other family members or subsequent spouses assert that they are the intended beneficiary.” They go on to discuss Illinois law on the issue and a recent case from the northern district, Richard v Martindale, No 09 CV 4159 (ND Ill, June 14, 2010).  The husband in that case never got around to removing his ex-wife as the named beneficiary of his life insurance policy. The court held that a divorce decree that "waived a spouse’s beneficial interest to a life insurance policy trumped any subsequent inference that the spouse remained the intended beneficiary,” Wolven and Crettol write, a ruling that “confirms Illinois’ current law regarding the issue.” A key practice takeaway, according to the authors: make sure your client’s divorce decree includes a waiver like the one in Martindale.
  • August 9, 2010 | Practice News
    Complaints from past centuries about legal writing
    I just finished reading The Plain English Guide by Martin Cutts this weekend. Good little book. A couple of his passages jumped out at me quoting complaints about legal writing from the 15th and 19th centuries. I thought they would be worth sharing.
    • "In 1550, after only three years on the throne of England, Edward VI had become so exasperated with the law that he remarked: 'I would wish that the superfluous and tedious statutes were made more plain and short, to the intent that men might better understand them.'"
    • "'Excrementitious garbage' was how Jeremy Bentham described legal English in the nineteenth century."
    Good to know that we've been consistent over the centuries.