Page 21 - The Handbook - Law Firm Networks
P. 21
Law Firm Networks – The Future of the Legal Profession
Level 1 Level 2 Level 3 Level 4
Event sponsorships No No some letterheads, and Yes – golf, auto races,
No business cards. etc.
Research grants No No Some small events Yes
Awards to non- No No Yes
members No No No
Trade publication No No Some – student writing Yes
advertising No No contests, pro bono
Business magazine No Yes Yes
advertising
Television No Yes
advertising
Foundation No Yes
Some
It is, however, very important to note that the models are equal in one sense: They reflect the needs of each
member at any given time. A small Level 2 network can be just as successful as a Level 4 if it meets the
needs and expectations of its members and a more sophisticated model is not needed or desired. A higher-
level network that does not meet expectations will not be successful simply because of its higher level.
The Disclaimer – the DNA of a Network
A Level 3 or 4 network is a legal entity in which independent law firms seek to demonstrate to clients their
relationships with other firms in order to provide services. This is important because the entity itself does not
provide legal services. This requires that the member firms either demonstrate adherence to common
standards or create the impression that they operate as one entity under a common brand. There is inherent
tension between the marketing of the relationships and the need to maintain independence so as not to incur
vicarious liability or violate ethics rules.76 Operational independence means that the network must be able to
define the relationships among members in terms of their common interests. The networks can easily blur
their relationships.
How does one recognize a network? Every network from PWC to Lex Mundi uses a “network disclaimer.”
The legal profession’s new Swiss associations also each have a disclaimer even though they profess to be law
firms. The network disclaimer of PWC77 states that the network members are independent firms that do not
practice jointly and are not responsible for the negligence of another member. It further states that the
network does not practice a profession or otherwise provide services to clients of the network’s members.
From the concept of independence found in the disclaimer, the foundation of both network operations and
governance is laid.
These legal disclaimers found on a website may be in contrast to marketing efforts that leave the impression
or seek to demonstrate uniform standards of brand quality. In the accounting profession, this duality has led
to the regulatory distinction between networks and associations.78 In the legal profession, the term “network”
has no statutory definition. This can lead to the confusion between what law firms are and what networks are.
For example, Lex Mundi and TerraLex are clearly recognized as networks. Clifford Chance, Jones Day,79 or
76 See infra Chapter 8, Networks and the Technology Revolution.
77 “‘PricewaterhouseCoopers’ and ‘PwC’ refer to the network of member firms of PricewaterhouseCoopers International Limited (PwCIL). Each
member firm is a separate legal entity and does not act as agent of PwCIL or any other member firm. PwCIL does not provide any services to clients.
PwCIL is not responsible or liable for the acts or omissions of any of its member firms nor can it control the exercise of their professional judgment or
bind them in any way. No member firm is responsible or liable for the acts or omissions of any other member firm nor can it control the exercise of
another member firm's professional judgment or bind another member firm or PwCIL in any way.” PWC SOUTH AFRICA,
www.pwc.co.za/en/index.jhtml (last visited July 25, 2015).
78 See infra Chapter 7, Regulations and Other Legal Considerations for Networks.
79 The Value of a True Partnership, JONES DAY, www.jonesday.com/atruepartnership/.
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Level 1 Level 2 Level 3 Level 4
Event sponsorships No No some letterheads, and Yes – golf, auto races,
No business cards. etc.
Research grants No No Some small events Yes
Awards to non- No No Yes
members No No No
Trade publication No No Some – student writing Yes
advertising No No contests, pro bono
Business magazine No Yes Yes
advertising
Television No Yes
advertising
Foundation No Yes
Some
It is, however, very important to note that the models are equal in one sense: They reflect the needs of each
member at any given time. A small Level 2 network can be just as successful as a Level 4 if it meets the
needs and expectations of its members and a more sophisticated model is not needed or desired. A higher-
level network that does not meet expectations will not be successful simply because of its higher level.
The Disclaimer – the DNA of a Network
A Level 3 or 4 network is a legal entity in which independent law firms seek to demonstrate to clients their
relationships with other firms in order to provide services. This is important because the entity itself does not
provide legal services. This requires that the member firms either demonstrate adherence to common
standards or create the impression that they operate as one entity under a common brand. There is inherent
tension between the marketing of the relationships and the need to maintain independence so as not to incur
vicarious liability or violate ethics rules.76 Operational independence means that the network must be able to
define the relationships among members in terms of their common interests. The networks can easily blur
their relationships.
How does one recognize a network? Every network from PWC to Lex Mundi uses a “network disclaimer.”
The legal profession’s new Swiss associations also each have a disclaimer even though they profess to be law
firms. The network disclaimer of PWC77 states that the network members are independent firms that do not
practice jointly and are not responsible for the negligence of another member. It further states that the
network does not practice a profession or otherwise provide services to clients of the network’s members.
From the concept of independence found in the disclaimer, the foundation of both network operations and
governance is laid.
These legal disclaimers found on a website may be in contrast to marketing efforts that leave the impression
or seek to demonstrate uniform standards of brand quality. In the accounting profession, this duality has led
to the regulatory distinction between networks and associations.78 In the legal profession, the term “network”
has no statutory definition. This can lead to the confusion between what law firms are and what networks are.
For example, Lex Mundi and TerraLex are clearly recognized as networks. Clifford Chance, Jones Day,79 or
76 See infra Chapter 8, Networks and the Technology Revolution.
77 “‘PricewaterhouseCoopers’ and ‘PwC’ refer to the network of member firms of PricewaterhouseCoopers International Limited (PwCIL). Each
member firm is a separate legal entity and does not act as agent of PwCIL or any other member firm. PwCIL does not provide any services to clients.
PwCIL is not responsible or liable for the acts or omissions of any of its member firms nor can it control the exercise of their professional judgment or
bind them in any way. No member firm is responsible or liable for the acts or omissions of any other member firm nor can it control the exercise of
another member firm's professional judgment or bind another member firm or PwCIL in any way.” PWC SOUTH AFRICA,
www.pwc.co.za/en/index.jhtml (last visited July 25, 2015).
78 See infra Chapter 7, Regulations and Other Legal Considerations for Networks.
79 The Value of a True Partnership, JONES DAY, www.jonesday.com/atruepartnership/.
10
