Lexington, KY - From recent mergers to the increasing use of technology to the ever-changing economic landscape, the practice of law in central Kentucky has experienced dramatic change in recent years. We asked professionals working in central Kentucky legal industry to share their thoughts on what the next two years has in store for their business.
- Chauncey Curtz, Dinsmore & Shohl
I expect the consolidation of law firms we have seen in Central Kentucky over the past few years will continue as more clients move towards the "one stop shopping" model for their legal services. Efficiences of scale and breadth of expertise will be advantages that will give larger firms a competitive edge over smaller firms.
I also expect there will be a continuing trend towards alternative fee arrangements. While I do not expect billable hours to disappear any time soon, I do think we will see more flat fees, fixed fees, and blended rates than we have seen in the past, as clients search for ways to have more predictability in their budgets for legal services.
As the economy begins to recover, I expect we will see banks beginning to make additional money available, and the real estate and construction industries will show signs of improvement. Improvements in consumer confidence and the market in general will also likely drive investment over the next few quarters.
- J. Mark Burton, Wyatt, Tarrant & Combs
At Wyatt, we are currently seeing a very strong litigation practice, much of it with some connection to the economic difficulties of the last two years.
Our work in the creditors' rights area continues to grow as our clients wrestle with their customers and suppliers over adjustments to the terms of agreements.
We also represent numerous banks of all types - money center, regional and community - and all are seeing an increase in lender liability or fiduciary-type counter claims - as borrowers who can't meet their loan obligations attempt to place the blame on someone else. Even though we are starting to see signs of real improvement in the economy, we expect the fallout
from the recession to
extend into the coming two years. Another major area of fallout from the recession is the wave of former
and current employees suing over wrongful discharge and Fair Labor Standards Act matters. When individuals are hurting for money, or have been laid off, they sometimes will turn to the courts to help them financially. In addition, economic corrections continue in the equine industry, and we find ourselves representing banks, as well as farms, in dealing with the recession's impact on the equine industry.
On the business side, in addition to handling a number of real estate loan workouts, we are beginning to see more real estate projects coming back on line as financing has solidified. As you might expect, the first real estate projects that are breaking ground are projects for institutions - for example we have a $500 million hospital project that has been keeping
a number of our real estate and construction lawyers
busy. On the corporate side, deal flow is beginning to improve. For the last couple of years it has been difficult to complete any corporate deals because valuations have
been so fluid. However, over the past several months
we have
served as counsel on
two major transactions - the formation of a joint venture between Mitsui & Co. (USA)
(the U.S. subsidiary of one of the largest
trading companies in the world) and Nucor Corporation (one of the largest steel producers in the world); and the purchase by PPL Corporation of E.ON's power and gas operations in the U.S., including KU and LG&E for $7.6 billion. Both transactions should have very positive
impacts on Kentucky's economy.
Looking at our practice, we have experienced increased interest from large corporations which have traditionally sent their work to law firms in New York, D.C., and Chicago. We have regular calls with the GCs of these companies where we discuss our capabilities, they discuss their needs and we see if there's a match. The GCs would like to move away from paying close to $1,000 per hour for attorney fees, while still receiving a high quality work product. Another trend we are seeing is more interest in alternative fee proposals that aren't based on the billable hour. We are embracing this trend and working together with our clients to develop creative fee structures that better align the firm's and
our client's interests.
Joseph Terry, Dinsmore & Shohl
As the economy improves, we will continue to see consolidation in the Lexington market; however, it may likely be "consolidation" through the acquisition of groups of partners or practice groups, not through law firm mergers.
While the demand for legal services should increase as the economy improves, there will continue to be pressure for discounting and alternative billing strategies, which all law firms must face. Law firms will have to continue to focus on doing the same thing cheaper or not at all.
Jeff Phillips, Steptoe & Johnson
Our law firm's strengths include government relations, litigation and legal services for the energy sector. Given the current political state of affairs, as well as recent events in the coal industry, our office should expect an increase in workload. Similarly situated law firms in central Kentucky may also experience additional retentions.