The war for lateral attorney talent within law firms.

• Jurisdiction: United States
• Date: 01 March 2013
• Author: Murdocca, Raffaele V.

Throughout the last several years, many law firms were seeing a decrease in revenue and profits because there was less deal work, clients were keeping more work in-house, clients refused to pay for first- and second-year associate work, and clients were successful at preventing significant annual rate increases or worked out alternative billing arrangements. As a result of this shift in legal services, law firms were looking at other ways to grow revenue. One way to grow revenue and profits was through the acquisition of lateral partner talent.

The industry averages about 2,400 lateral partner moves a year, with close to 2,700 lateral moves in 2012. In the "2012 Am Law Study on Strategic Planning at Law Firms," respondents were asked what the firm's top business strategies were for this year. The number one response was "growing the firm's revenue" and a very close second was "talent acquisition and retention." If you talk with law firm leaders, they would say these two go hand-in-hand.

An ALM-LexisNexis survey cited in the American Lawyer found that when firm leaders were polled, 70 percent are expecting to hire more lateral partners over the next five years and 96 percent said pursuing lateral acquisitions is part of their growth strategy over the next two years. As one can easily surmise, growth by lateral partner...