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Law Firm Management

Finders v. Grinders

Let’s cut to the chase:  Law firms compensate lawyers for two things: (i) fees billed for their own work; and (ii) fees billed for work that they introduce to the firm which is done by someone else. (In theory there are some other things that matter also, but in practice you cannot get rich by doing any of them.)  

My topic today is about getting paid for bringing in work. We call the lawyers who do that “Client Lawyers.”  Let’s call the lawyers who do the legal work for these clients the “Working Lawyers.”

Client Lawyers can become legends in their own minds. They say things like “I have a book of $3,000,000. I am a hero. Pay me most of the money.”

Some Client Lawyers are knowledgeable and capable. Some are not. Being a Client Lawyer is not about how good a lawyer you are. It is about how good a salesperson you are. Now to be fair, sometimes these things go together and you develop a client base by being so good at what you do that your reputation for excellence attracts clients to you.  But very often Client Lawyers attract clients for reasons that have nothing at all to do with legal skills. Frankly, it doesn’t matter. If you can attract a client base, you will get paid for it no matter how you do it.

If you are a Client Lawyer and getting a large slice of the pie because you are a fantastic rainmaker, there sometimes develops a tendency to think that you own the Clients that you have brought to the firm.  This feeling of ownership is often reinforced by firm policies that attribute Client Lawyer status to the lawyer who first brought in the client. And that is where the fun begins. Conversations like this tend to happen:

  1. Client Lawyer:  I am the Client Lawyer. Pay me.
  2. Working Lawyer: You brought the client in ten years ago. I have done all of the work for them since. You would not recognize them if you passed them in the hall. I should be the Client Lawyer now.
  3. Client Lawyer: If you don’t keep paying me for bringing clients in, I will have no incentive to continue to go to the best restaurants and Raptor’s games at the firm’s expense.
  4. Working Lawyer: You can’t keep getting paid forever for what you did 5 years ago. There has to be a limit. After three years, let’s designate the client a ‘Firm Client’ and nobody will get paid for bringing them in.
  5. Client Lawyer: If we call them a Firm Client nobody will have an incentive to wine and dine them, and we will lose them. Just keep paying me.
  6. Working Lawyer:  We need to redefine Client Lawyer and put an end date on it.
  7. Client Lawyer: No we don’t.

That is a short version of the conversation. The longer version is even stupider.

There is only one real definition of a Client Lawyer, which is as follows: “You are the Client Lawyer if and only if the client will follow you if you leave the firm.”  Smart law firms don’t make Working Lawyers prove this by leaving the firm and taking the clients with them.

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