Sorry, Morgan Stanley: One Big Law Virtual Office Is Booming (1)

Welcome back to the Big Law Business column on the changing legal marketplace written by me, Roy Strom. Today, we look at the progress a Big Law firm has made in Year One of its virtual office experiment. Sign up to receive this column in your inbox on Thursday mornings.

J.Y. Miller has read what Morgan Stanley’s Eric Grossman said about the perils facing the legal profession should Big Law firms continue to let lawyers work remotely.

Miller respectfully disagrees. But that should come as no surprise.

He leads what is likely the largest Big Law experiment with a virtual office to date: Husch Blackwell’s “The Link.” And he’s proving at least for now that lawyers have a big appetite for stay-at-home work.

I wrote about The Link’s launch a year ago this week, when the fledgling operation had 38 attorneys and about 50 staff members signed up for full-time remote work. Twelve months later, lawyer headcount has nearly doubled to 73. Husch Blackwell plans to add more than 70 staff members to its virtual office this fall, bringing its total headcount to roughly 200.

Nominally based in St. Louis, Miller defends clients against toxic torts claims. Lawyers in The Link represent clients on a wide variety of matters. He said most clients have had a positive reaction to the firm’s remote work strategy.

“We haven’t really seen a negative reaction; it has been quite the opposite,” Miller said in an interview. “A lot of the feedback we receive from clients centers around how impressed they are the firm has made this commitment to our people.”

Robust revenue may also be an indicator that clients don’t mind working with permanently remote lawyers. According to the latest AmLaw data, Husch Blackwell pulled in more than $417 million in revenue in 2020, up nearly 10% over the previous year.

The Link is already Husch Blackwell’s fourth largest office by lawyer headcount, trailing cities where its brick-and-mortar offices have long histories: St. Louis, Kansas City, and Milwaukee.

Miller and virtual office partner Jennifer Dlugosz said The Link has been a boon for attorney recruiting. The firm has added remote lawyers in at least 14 cities where it doesn’t have a physical office over the year. Some of those lawyers previously worked in Husch Blackwell offices and relocated during the pandemic.

Fewer employees are relocating for jobs, according to a survey from outplacement firm Challenger, Gray & Christmas Inc. The percentage of job seekers who relocated to work fell to 4.2% in the first quarter of 2021, the survey of 3,000 participants showed. That was down from 9.6% in 2018, 5.7% in 2019, and 5% in 2020.

One example of The Link expanding the firm’s recruiting options happened with an associate in the Harrisburg, Pennsylvania area, Dlugosz said. Husch Blackwell has no office there, but the associate saw The Link as an option to work for an AmLaw 100 firm while staying near the state capital, where her husband is a doctor.

“I don’t think we’d otherwise recruit in Harrisburg, Pennsylvania and now we have someone on our team there who is excellent,” Dlugosz said.

Morgan Stanley’s Grossman reportedly was concerned about the growth and mentorship opportunities for young lawyers working remotely, which others have pointed out are often key to making partner. Miller admitted that concern is “legitimate,” but said the firm’s virtual lawyers have the same career opportunities as lawyers in traditional offices. The firm says four of the 23 lawyers it promoted to partnership at the start of the year are based in its virtual office.

The firm is trying to recreate the type of random office run-ins The Link lawyers might otherwise miss, Miller said. He pairs members of The Link with lawyers in other cities for 30 minute “coffee chats” based on similar practice areas or shared clients. And in August The Link is getting out of its virtual bubble to gather in St. Louis for its first quarterly in-person gathering.

“We acknowledge working in the Link is not for everyone, and that’s OK,” Miller said. “But for the people it does help and the client teams it does support, I think it is crucial that we continue to invest in The Link and those teams who are using it to continue to support our clients. I’m really proud our firm has made that commitment to The Link and to our people.”

Worth Your Time

On Contingent Fees: Chris Opfer profiles Bill Carmody, the New York trial lawyer with a large appetite for risk who recently helped former WeWork CEO Adam Neumann secure a nine-figure settlement.

On Returning to the Office: Brian Baxter and Ruiqi Chen write that Morgan Stanley’s back-to-office edict puts law firms in a tight spot with lawyers who prefer working from home. Cooley, meanwhile, won’t require lawyers to return to the office in 2021.

On Lateral Recruiting: The number of bankruptcy cases might be languishing at low levels, but Winston & Strawn is investing in the restructuring practice. It hired McDermott Will & Emery’s former restructuring practice head, Tim Walsh, Meghan Tribe reports.

That’s it for this week! Thanks for reading and please send me your thoughts, critiques, and tips.