Boutique law is having its day.
Some veterans of Orange County’s biggest law firms have been hanging out their own shingles or joining smaller firms targeting niche clients. The growing trend has been fueled by the recent recession, slow recovery—and a spreading sense that less is more.
“There are a lot of the ‘big firm refugees’ doing well right now,” said James Godes of Godes & Preis LLP in Irvine. “Clients have responded enthusiastically. There’s a receptivity to it that really didn’t exist before.”
Godes & Preis was launched in January 2010 by James Godes and Joseph Preis, then partners at Pepper Hamilton LLP’s Irvine office. Pepper Hamilton is a multi-practice national firm with more than 500 lawyers.
“What I saw in 2009 was a divergence of interest between the law firms and their clients,” Godes said. “Clients were really suffering as a result of the economy. And the ‘Big Law’ response to that—as opposed to saying, ‘We’ll partner with you until you’re back on your feet’—it was exactly the opposite. There was a tremendous amount of pressure to raise rates at the time the clients could least afford that.”
Godes & Preis specializes in handling “business divorces … the range of things that happen when people decide not to work together anymore,” Godes said.
“That’s an everyday occurrence [and thus forms] a recession-proof industry,” he added.
Murphy & Evertz in Costa Mesa launched in April 2010, specializing in business litigation. The niche calls for expertise in management and employment issues, trade secrets, non-compete work and partner rights.
“The move from ‘Big Law to boutique’ is a constant theme in the legal community—in particular since 2007,” said John Murphy, Murphy & Evertz managing partner. “Boutiques have become more pronounced.”
Murphy said boutique firms can be more flexible than larger firms in adjusting to clients’ financial needs.
“We’re all alumni of larger law firms,” Murphy said. “By that, I mean Luce, Forward, with about 200 lawyers, Straddling Yocca, 150 or so. We found that we can maintain a highly sophisticated practice without the umbrella of a massive law firm.”
A smaller firm can be “lean and mean, and flexible as to staffing,” Murphy said.
Godes also counts the lack of bureaucracy as one of the biggest strengths of having a boutique office.
“We don’t have to get 18 layers of management approval,” he said.
For Godes, who spent more than 20 years in “Big Law,” the change required more than an entrepreneurial spirit.
“I grew up in that Big Law system,” he said. “That was the only way to practice law as far as I could tell. I was way too much of an elitist, and I needed to shed that skin. And once I got over that emotional hurdle, I’ve been having a ball.”
The boutique trend could be a reaction to what the law firm landscape was like a decade ago, said Karla Kraft, a partner at Hodel Briggs Winter LLP in Irvine. Kraft made the transition in 2003 from the OC office of Los Angeles-based Paul Hastings LLP, where she was a litigation associate.
“During the boom years, late 1990s to mid-2000s, firms had increasingly large summer classes,” Kraft said. “It was not unusual for Los Angeles firms to have a class of 25 or more lawyers, or for an OC firm to have 10 or more. The reality is that every summer associate cannot become a partner at a big firm. A natural byproduct is smaller firms.”
The cofounders of Hodel Briggs Winter were partners at Paul Hastings before leaving.
A typical small-firm trait is that it doesn’t offer “summer associate programs like most large firms do,” Kraft said.
Hodel Briggs Winters only hires experienced attorneys.
Some of the perks that came along with being part of a big firm are not an option for boutiques by nature of the size.
“We gave up the creature comforts of having an information technology department or a marketing department,” Godes said.
Partners at a boutique might find themselves in a number of roles, according to Marc Carlson, who recently opened his own law office in Irvine.
Carlson spent about seven years at the Irvine office of Washington, D.C.-based Jones Day.
“At a big firm, there are a lot of things you don’t have to deal with,” Carlson said. “Going to a small firm means developing a client base, support staff, paralegals, secretary—you’re not only the lawyer, but basically everything else.”
