Law Practice Management eNewsletter

December 2008

Section LinksContents
From the Chair
Recession Planning
Site Watch
Employment App
Annual Meeting

Section LinksSection Links
LPM Website
Officers and Council

Bar LinksBar Links
SBM Website
Calendar of Events
Public Policy Updates

Section LinksDecember Focus

NewsFrom the Chair

The Law Practice Management Section's Annual Meeting on September 17, 2008, was a tremendous success. Our educational program entitled, Keep Your Law Firm Going in These Tough Economic Times, had over 40 attendees with topics ranging from billing, planning for the future, and dealing with employee issues. 

The topic of the economy continues to dominate the management of business. The auto companies are seeking federal assistance and the financial impact that these issues have on the Michigan economy is staggering given the many businesses that are tied to the auto industry. During these times, many law firms are challenged and face difficult decisions regarding cutting staff, reducing hours, eliminating benefits, and closely examining every budgetary item. Law firms and all business, need to carefully consider whether to make salary increases or pay bonuses to employees, since fiscal conservation is critical to the continued existence of a business.

Attorneys also must be diligent on billings and collections. The risk of having clients file for bankruptcy is on the rise. Once a bankruptcy is filed, the attorney is lucky to collect pennies on the dollar. Further, attorneys need to be mindful that even if a client makes a payment, it may have to be returned if the entity or individual files bankruptcy within a certain period of time after the payment is made.

With these issues in mind, we are working toward continued educational partnerships with other State Bar sections and organizations. In this regard, please provide me with any expertise that you have which you would be interested in sharing.

For the Law Practice Management Section, the next year will include many challenging and exciting topics, including the Section's potential merger with the Legal Administrator Section of the State Bar of Michigan. We are working with the State Bar to accomplish this and are very excited about this opportunity which will benefit our members since the administrators are typically at large law firms which utilize the latest and greatest in technology, billing, and other management tools. This merger will benefit all members of our Section.

Our next meeting will be held on January 31, 2009, from 9:00 to 11:30 a.m., at the Crowne Plaza, 27000 Sheraton Drive in Novi. Future meetings will take place on May 2, 2009, from 9:00 a.m. to 11:30 a.m., in Detroit and August 1, 2009 (location to be announced).

I look forward to this year as chair of the Section and appreciate all that I learned from our immediate past chair, Gary P. Bauer. If you are interested in being a part of our Council, getting more involved, or attending one of our meetings, please contact me. There will also be an informal gathering of individuals from the council on December 18, 2008, in Novi.

Rebecca Simkins
Chair, Law Practice Management Section

Section EventsRecession Planning for Solo Practitioners and Smaller Law Firms
By Austin G. Anderson

I have prepared a new summary of suggested steps that may be taken to engage in recession planning. My summary includes elements from my review of articles and discussions with solo practitioners and members of smaller law firms that demonstrate several steps that should be considered by sole practitioners and lawyers practicing with smaller law firms focusing on recession planning. The summary demonstrates several steps that solo practitioners and lawyers practicing with smaller law firms should consider taking at the present time. The steps are listed below.

    1. Don't panic. Practitioners have the room to maneuver if some of their work dries up. Developing a plan is more important in order to survive during the current recession and for the extended "down" period of the economy as is projected by economists.

    2. Develop a vision of your future practice and involve everyone in your firm in developing the vision. Keep thinking about tomorrow. Keep marketing even when you are very busy.

    3. Take time to follow up on leads, whether they are phone calls or e-mail messages. Potential clients continue to need help, but may not know where to find it.

    4. Diversify your practice. The way to decide whether to take on other practice area depends on your answer to the following areas of opportunity;

      a. Pick up work in areas of law that you previously abandoned for some reason. Analyze the reasons that you abandoned the areas of practice and see whether the reasons can be overcome.

      b. Expand your practice into an area of practice related to your current practice.

      c. Identify new areas of practice that might do well in spite of the recession and whether it would make sense for you to venture into this type of work.

    5. Develop and implement a marketing plan. Focus your efforts on attracting new business. Review the elements of an effective marketing effort; web site, newsletters, articles and speaking engagements.

    6. Invest some money to generate new business. Don't cut back on your marketing expenses. Wisely invested money in marketing efforts will result in new business.

    7. Consider taking some time off. Getting away from your daily routine will enable you to develop some good ideas about expanding your practice.

    8. Organize your workplace. If you have some time because business is slower, then take advantage of the available time to straighten up your office.

    9. Consider your billing efforts. Consider using alternative billing practices that ultimately deliver the same income for your practice as your pre-recession billing rate and practice. Before you institute an alternative billing arrangement, visit with your client to discuss the change that you are considering. Explain what will be involved in the new billing system. Among the alternative billing practices is setting a fee, at the outset, for the services provided in order to resolve the issue(s). Setting the fee and explaining it to the client will enable the client to know the amount of the fee for the service and, provided the billing lawyer develops a payment timetable for the client, the client will be aware of how much will be paid according to the billing schedule.

    10. Meet with other lawyers in similar situations; similar size law firms, similar practice areas, or the same geographical area. Use the meetings to gain support from the members of the group, as well as to learn other management techniques employed from other members of the group. Also use the sessions to instruct the members of the group of your practice areas.

    11. Review your personal strengths. Think of the benefits that you have including your family and friends. Manage your health to insure that you are able to handle any of the successes that you have continued and added through your marketing efforts.

    12. To improve your firm's financial situation, manage your receivables. The effective management of your receivables will insure that your firm's income will continue to arrive.

    13. If you employ an office manager, a bookkeeper or other individual in a management position, treat that person as a coach. The coach can advise members of your firm, based on the coach's experience and familiarity with the firm and its members; on client selection; billing practices, including collecting fees at the conclusion of a trial; other collection efforts and techniques, and delegation of work to less expensive members of the firm. By less expensive members I mean the members of the firm with lower hourly or other rates than the primary lawyer in the matter.

    14. Regularly stay in touch with your clients. A failure to communicate with clients is often the reason that they are lost. Make a point to meet with them in their office or their business.

    15. If you or some member of your firm is practicing Family Law, be aware that a prospective client may not return for a second visit. The reason for the prospective client's failure to return may result from an emotional decision on the part of the client or the financial situation involving the divorce; separate housing, the fees to be paid; or the mental anguish that may be perceived as the potential client views the divorce proceedings. It is important to point out that negotiation is an important part of the divorce process.

    16. Determine the accuracy of your hourly rate by dividing the firm's expenses, whether a sole practitioner or smaller law firm by the billable hour projection. This step will enable you to set rates that will recover the cost of doing business and provide a firm profit.

    17. Strive to increase the firm's cash flow through increasing your client base and managing the firm's expenses.

    18. Have the courage to terminate clients that are not paying their bills. The change in investment of time in client development and client productivity will improve the firm's financial situation.

    19. Cultivate your existing referral sources and strive to increase the number of referral sources. If work has slowed down, the number of phone call declined and the number of e-mail messages has been reduced, devote the time gained to increase referral sources and clients.

    20. Remember to acknowledge the contribution made by client and referral sources though including them on you list of holiday card recipients and their birthdays, if you have access to that information.

Implementing several, if not all, of the suggestions should insure your continued success in the practice of law.

Copyrighted, used with permission.
Austin G. Anderson, B.A., JD, Austin Anderson Consulting, llc, serves as the business advisor to law firms which he shows how to improve their profitability, marketing efforts, financial discipline, effective human resource management, strategic planning and to engage in succession planning. He is the author or co-author of seven publications and numerous articles on the elements of effective law firm management. He is recognized in the following Who' Who publications: in the Midwest; in American Education; in America; in American Law and in the World.

Section EventsSite Watch
By Ernie Gifford

For those of you that have not used it already I would like to introduce you this time to a site designed primarily for lawyers. The site is and while it has a great deal of information of primary interest to lawyers it also has a lawyer listing for those looking for legal services. It is a good website to look at if you need to refer to another attorney.
At the home page there are links to legal practice areas such as injury law, family law, etc. As a patent lawyer I wanted to see what the site had with regard to this area of law so I clicked on Intellectual Property Law. This provides a very basic overview of the law of intellectual property as well as docket reports of recent intellectual property litigation. There is a glossary containing a definition of intellectual property terms and there are links to statutes and regulations relating to patents, trademarks, and copyrights.

There is also a link to Lawyers & Attorneys (it seems like one or the other would have been enough). Clicking on Lawyers & Attorneys brings you to a web page which permits you to find intellectual property lawyers by city and state. I clicked on Michigan and Flint because I know that there are very few intellectual property attorneys in Flint and we have an office there. This brought me a listing of a number of attorneys, none in Flint, and most that I did not know were practicing intellectual property law. I wasn't among those listed so our Flint office was evidently not among those with a listing on the site. Although the list included Oakland County attorneys and attorneys with offices in Troy, our Troy address was not included either.

I assumed that my absence from the listing was because we had not formally listed with the website. There is a link Get Listed and clicking on that link brings up a Sign Up page.  Completing the short sign-up form I was told that there were profiles similar to mine already listed. I checked and they were both mine, one for the Troy office and one for the Venice, Florida office. The profile for each was incomplete. There was no indication that I practice IP law from the Troy office in my profile and that is evidently why my listing didn't show up in the request for Flint IP attorneys. There were other errors on my profile. For instance the Florida listing said I had been in practice 9 years when in fact I have been in practice almost 50 years.

I am not sure how I became listed but to provide a correct profile requires that the profile be claimed. When the profile is claimed by clicking on the appropriate link the opportunity to either add a profile or to modify the on that is already listed is provided. After registering and claiming I modified the profile that they had for me to include the practice area of intellectual property law for our Venice, Florida office. I did a search and now if you are looking for a patent attorney in Venice, Florida you will find me among those listed.

After I registered and I changed my profile to include the practice area of intellectual property for our Venice office, I did the search again, and now if you are looking for a patent attorney in Venice, Florida you will find me among those listed.

On the home page there are links for Legal Research and Law Practice which will take you to websites for cases, codes, legal forms, law blogs, and legal podcasts. This section combined with the link Key Legal Research Sites provides for completing a rather extensive legal research project at no cost.

The site is worth exploring. Take a few minutes and do that. If you are not already registered take a few minutes to do so. It's free and it may lead to some referrals or even some new clients. I am sure you will find the site to be as useful in your practice as I have.

Ernie Gifford
Gifford, Krass, Sprinkle, Citkowski and Anderson P.C.

Other EventsThe Employment Application: A Critical Document
By Rebecca Simkins

As an employment defense lawyer, I regularly represent businesses who are sued related to an employment issue. I recently handled a couple of lawsuits, representing employers who have been sued for discrimination and/or wrongful discharge. In these cases, a properly drafted and executed employment application was critical to the quick disposition of the case.

In case "A", the employee filled out the employment application indicating that she had voluntarily left certain employers. At the end of the application, the potential employee "certified" (via her signature) a number of different issues, including her status as an at-will employee and that the information contained in the employment application was true and that if any of the information she provided was false, she understood she would be immediately terminated. When my client terminated this employee for poor performance and absenteeism, after just a few weeks of employment, she filed suit claiming she was a whistleblower. At the plaintiff's deposition, it was established through information subpoenaed from prior employers, that plaintiff had in fact falsified her application, since the prior employers she claimed she left voluntarily had actually terminated her employment. Her attorney agreed to settle the case for a nominal amount after the employment application fraud was discovered.

In the second instance, case "B", the employee applied to work at a medical facility and was required to disclose criminal convictions on the application pursuant to Michigan law. She certified that she understood that the information in the application was true and that if the information was not true that she would be immediately terminated. The employee had been convicted of two felonies that she failed to disclose. These felonies did not appear in the Michigan State Police Criminal Conviction Record for several years. When this information was discovered, the employee was terminated and then claimed that her discharge was discriminatory. The employer successfully defended the matter based upon the employment application fraud which was considered a legitimate non-discriminatory reason for the employment action.

Courts have held that falsified employment application information is relevant in a subsequent lawsuit when the false information was relied upon in making the employment hiring decision. In Johnson v. Honeywell Info. Sys., Inc., 955 F.2d 409, 414 (6th Cir. 1992), the Sixth Circuit Court of Appeals held that an employer would be entitled to summary judgment in a civil rights claim, if "the misrepresentation or omission was material, directly related to a candidate for employment, and was relied upon by the employer in making the hiring decision. See also Milligan-Jensen v. Michigan Technological Univ., 975 F.2d 302, 303 (6th Cir. 1992) (discharge justified where employee had omitted a prior DUI conviction from her employment application); W. Kelly Gregory, Inc., 207 NLRB 654-55 (1973) (Board refused to award back pay and reinstatement where driver failed to include on his employment application former employer that had terminated his driving employment because of his drinking problem); and Dotson v. U.S. Postal Service, 977 F.2d 976, 977 (6th Cir. 1992) (employee's omission of important medical history concerning back injury and dismissal from two jobs due to this injury on employment application held to be sufficient for termination).

As the case law establishes, application fraud is a legitimate defense to an employee's claim of wrongful termination and can be very helpful in obtaining a quick resolution to a claim of wrongful termination or discrimination in employment. Unfortunately, the use of the employment application is a frequently overlooked step in the hiring process. This critical document includes significant information and contains significant acknowledgments from the applicant and should be used for all hires. The application must be executed by the employee and placed in the personnel file to be enforceable.

Rebecca Simkins is a member of Barris, Sott, Denn & Driker, P.L.L.C. where she practices labor and employment law, representing management.

Other EventsLaw Practice Management Section Annual Business Meeting

I. Attendance. Present were members and guests of the Annual Meeting and Educational Program of the Law Practice Management Section of the State Bar of Michigan.

II.Call to Order. The meeting was called to order by the Chair, Gary Bauer at 12:06 p.m.

III. Approval of Minutes. The minutes of the LPMS Business meeting of August 8th, 2008 were approved. Motion to approve by Rebecca Simkins, Second by Vince Romano. Passed unanimously.

IV.Treasurer's Report. Treasurer, Vince Romano reported that following distribution of the August 2nd, 2008 Treasurer's Report, a glitch in the software program of the State Bar was discovered. Updated financial reports were forthcoming and would be distributed at the next meeting. Treasurer, Vince Romano further noted that the Section was in good financial shape with a sizable financial reserve.

V. Election Committee Report. Chair, Gary Bauer introduced the Chair-Elect, Rebecca Simkins and commented on her excellence as a Vice-Chair and discussions about the forthcoming year. Passing the gavel to Rebecca Simkins (and conference phone), new Chair, Rebecca Simkins made commendatory remarks and presented a plaque for his service to Immediate Past Chair, Gary Bauer.

    (A) Election of Officers. Chair, Rebecca Simkins announced open seats available on the Council and outlined the various positions as filled for their respective expiring terms. Konnie Kustron was nominated as Secretary. Motion to approve by Rebecca Simkins. Second by Vince Romano. Passed unanimously. The slate of Officers and Members to be filled were announced and a Motion to approve was made by Chair, Rebecca Simkins. Second by Treasurer, Vince Romano. Passed unanimously. Chair, Rebecca Simkins welcomed all new and returning members and announced the meeting schedule for the following year.

VI. Newsletter. Chair, Rebecca Simkins announced that the newsletter was on schedule and commended Ernie Gifford for his efforts towards the newsletter. Chair, Rebecca Simkins further noted that any suggestions or articles for the newsletter were welcome.

VII. Old and New Business. Chair, Rebecca Simkins announced that a by-law amendment was prepared for consideration for the purpose of reimbursing the Editor of the newsletter for any incidental costs in preparing and distributing the newsletter; and, a by-law amendment to bring the Section into compliance with Supreme Court, Rule 9 was also noted. Motion to approve by Treasurer, Vince Romano. Second by Chair, Rebecca Simkins. Approved unanimously.

VIII. Presentation of Awards. Chair, Rebecca Simkins and Treasurer, Vince Romano presented Dean Don LeDuc of Thomas M. Cooley Law School an award and plaque on behalf of the Section for his many acts of kindness towards the Section and to Michigan lawyers. Immediate Past Chair, Gary Bauer accepted on behalf of Dean LeDuc noting that Dean LeDuc and Thomas M. Cooley Law School have been very supportive of the Council by providing resources, sponsoring the Section and his many other efforts in enhancing the welfare of Michigan attorneys. Plaques and awards were also presented to Ernie Gifford and Henry Gornbein.

IX. Adjournment. Treasurer, Vince Romano made a motion to adjourn and Chair, Rebecca Simkins seconded the motion. Meeting adjourned at 12:30 p.m.