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Dispute Resolution: How Industry-Focused Law Firms Add Value

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I was inspired to write this post after reading the article “Choosing a Litigation Focused Law Firm for Disputes Adds Value to Companies,” by Peter F. Valori, Managing Parter of Damian & Valori, LLP. Peter and his partner Melanie Damian were my first employers out of law school, after I got to know them as regulars while managing a sushi restaurant in South Miami Beach before law school. They were extremely valuable early mentors of mine who put far more emphasis on correctly training me than generating revenue with me, for which I have always been grateful, and I have always thought of their firm as an exemplar of a well-run and extremely well-respected boutique litigation firm.

Peter’s argument is compelling: companies can get potentially get more value out of a lean, litigation-only law firm than they can out of the litigation department of a larger, generalist firm. Peter makes a very valid point:

Like any big corporation, BigLaw firms have a lot of overhead. Their fees [generated from their litigation practices] support other larger departments, like their corporate, real estate, and tax practices. Each of these increase the number of personnel and need for physical plant. In turn, client pay higher billing rates to cover additional costs.
Typically, litigation-only firms are smaller, have less lavish office space, lower overall staffing costs, are more efficient users of technology, and therefore, have lower overhead costs. They pass on those costs savings to clients, but still provide the same quality services.

For similar reasons, cannabis and hemp industry clients can often add value by retaining a smaller, industry-focused law firm, rather than a large firm with a cannabis law practice. First of all, not everyone may be aware, or remember, that the prevailing attitude towards cannabis in the legal profession up to about four years ago was one of blanket derision and dismissal. Four years is not a long time, and the legal establishment has not materially changed. Why then did so many firms suddenly sprout cannabis practice groups around four years ago, the same time as recreational legalization? Because a whole lot of money and a whole lot of people were entering the industry, and BigLaw partners have second and third homes to maintain! (In contrast, we at GLLG only reluctantly accept the modest fruits of our law firm’s success, having of course given zero thought to material emoluments at the inception of the venture). To take advantage of this opportunity, larger firms quickly set up cannabis law practice groups, and even though the more senior attorneys at these firms were cautious about disclosing involvement in cannabis work to their larger, more conservative institutional clients, they were happy to accept the increased revenue from this new practice area.

Lawyers at cannabis-focused firms have known from the beginning that by publicly associating themselves with the cannabis industry, they risk scorn from more conservative members of the legal profession, including many judges, and foreclose obtaining legal work from potential clients who are anti-cannabis. The successful lawyers at these firms have embraced this association and used it to their advantage: woe to any lawyer who has underestimated our litigation team because they failed to take cannabis lawyers seriously! Cannabis-focused lawyers also have a major advantage against regular litigators in cannabis business cases, because any time a regulatory issue arises, the lawyer from the cannabis-focused firm can use the opportunity to educate the judge or arbitrator, increasing their own authority and augmenting their client’s credibility on key issues.

Cannabis-focused firms also tend to be smaller and more agile. With fewer staff members and a less lavish infrastructure to support, these firms keep hourly rates and ultimately client costs down while providing focused legal services comparable or superior to those available at larger generalist firms.

To put it all together, when considering what legal team to hire, cannabis-focused firms often provide greater expertise and industry knowledge along with committed partners and lower hourly rates, and thus can be more cost-efficient than hiring the cannabis legal department of a large firm.

You can contact Andrew DeWeese at info@gl-lg.com or (503) 488-5424.