Roving RSG - Monthly Archive - Jan 2011

Revealing the ‘Science’ behind Legal Innovation: The Privatization of Midway Airport – a case study

School children in science classes across the world are often taught that photosynthesis in plants requires sun, water and carbon dioxide. In a similar way the roots of an innovative legal deal flourish when there is a coalition of innovative client, innovative law firm, and innovative lawyer. However, unlike photosynthesis, deals do not always come off when these three factors are present.
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Radiant Law: A New Band of Lawyers?

In the music industry, the formation of Radiant Law in January 2011 would have been called a ‘super-group’: a band formed by musicians who are already famous. Cream and Crosby, Stills, Nash & Young are examples of successful super-groups. Depending on your age so too are Monsters of Folk and Them Crooked Vultures.

Forming a super-group can allow an established artist the freedom to experiment with new sounds that stray outside previously successful formulas.

The line-up of the Radiant Law ‘super-group’ includes a partner from Latham & Watkins, a partner from Morrison & Foerster, a partner and partner-to-be from Barlow Lyde & Gilbert and a senior in-house lawyer from Deutsche Bank.

Some in the legal press have labelled this new firm a boutique, and Radiant Law certainly ticks two criteria in the boutique definition: the firm is small – five guys in a room – and it specialises in technology and outsourcing.

But when we met Radiant Law at their London office in media and design-friendly Clerkenwell, Alex Hamilton – the former Latham & Watkins partner – was adamant that he has not set up a boutique. He points out that Radiant Law is something quite different.

Firstly, it is not a partnership. The five founders are all shareholders in a limited company. Two of them, Hamilton and David Skinner (ex-partner at MoFo), are directors of the company and all five hold the vaguer title of ‘principal’ rather than partner.

Secondly, the company has no plans to recruit associates. Instead all the heavy lifting will be outsourced to the LPO provider, Pangea3, in India. Only a secretary and a secondee from Pangea will swell the headcount in the near future.

Thirdly, the company – billed on its website as a ‘platform for innovation’ – is committed to offering clients fixed fees.

None of these factors necessarily make Radiant Law innovative. Our innovation reports with the FT in Europe and the US have shown that fixed fees and outsourcing are now common place. Iterations of these innovations do appear, such as BLP’s arrangement with Thames Water, but a straightforward outsourcing deal has not been recognised as innovative since 2009.

“The big change over the next few years is that we will get different models of law firm and I think the models will drive the innovation,” says Hamilton. Clearly alternative business structures, coming into force in October of this year, have the potential to make such law firm remodelling easier and more elaborate, but Hamilton says his firm’s approach has little to do with the Legal Services Act: Radiant Law is not going to float or accept outside investment any time soon and he sees the impact of the LSA more at the retail end of the market.

Rather, Hamilton believes that there is a middle ground in between the big law firms and their relationships with know-how providers like PLC and LPO’s such as Pangea 3. He believes that most law firms have under-utilized the former and have a fractious relationship with the latter. Radiant Law, on the other hand, intends to offer clients an alternative law firm that embraces each of these elements at every stage of the business.

Hamilton is upfront about the firm’s approach and he is equally under no illusions about the originality of the offering. “Like any innovation,” he says, “it’s not necessarily about inventing something new but often about re-purposing what’s been done in other areas.” He speaks frequently about the latest developments in law firm management (he talks about Jeff Carr’s ‘four buckets’ concept with approbation) and he is candid when speaking about himself: “I’m a magpie. I like to collect interesting ideas.”

In last year’s FT Innovative Lawyers Report in Europe, Alex Hamilton was a top ten innovative individual for his work at Latham & Watkins, where he has been consistently vocal on the topic of legal innovation. Between 2006 and 2009, three of his innovations were featured in the Innovative Lawyers Report.

These days, however, he talks – and smiles – like a man free of the frustrations of a big law firm. Away from securing management committee approval he can now experiment with the latest technology and green light his own initiatives; the first being the establishment of his own firm.

The future of Radiant Law looks as exciting as it does uncertain. Some super-groups only last for an album before egos collide and musical differences are cited, whilst others can go on to enjoy fame in excess of their original status.

Ultimately, whether this new band of lawyers lasts for one album or goes on to redefine the industry will depend upon the client fan base it can attract. The firm did not mention any trophy client names to us but they have corporates and banks in their sights. Hamilton says they hope to compete with firms like Eversheds, BLP and Kemp Little.

Can a new model law firm grab the attention of a client? Geoffrey Timms, Group General Counsel at Legal & General, would not rule out using a firm like Radiant Law. But in an increasingly crowded market, he says “the bottom line is whether they could convince us that we will get a better service for a better price.”

Who is Europe’s most consistently innovative law firm?

The beginning of the new year is when everyone at RSG Consulting and the FT starts to think about the themes and contents for this year’s European Innovative Lawyers Report. But before we get too immersed in legal trends and innovation forecasting, we thought it would be interesting to look back at the firms who have been the most consistent performers since 2007, when the FT Law 50 began ranking firms on the basis of – amongst other things – their overall performance in the Report.

Therefore, for academic interest only, the most consistent law firm over the previous four years is….
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