More on Law Firms Going Public
A few weeks back, I posted about an article authored by professor Larry Ribstein on everything you wanted to know about law firms going public. Now, Bruce MacEwen offers a perfect bookend to Ribstein's article, with this post entitled
Seven Perspectives on Law Firms' Going Public.
Actually, the seven perspectives in the article -- offered by a prominent group of authorities from law firms, the financial industry and academia -- are all surprisingly similar. Most quoted in MacEwen's post expressed surprise that the United States is so far behind the times or seemed resigned that law firm IPOs are just a matter of time. Only one lawyer, Steven Krane, chair of the ABA's ethics committee and a partner at Proskauer Rose, took a different position, identifying potential problems with law firm IPOs. Krane's position is that:
Stock sales might force lawyers to put shareholders above clients and create conflicts between the attorney-client privilege and Securities and Exchange Commission disclosure requirements. "It's a perpetual conflict, at least potentially, with non- lawyers controlling a law firm,'' said Steven Krane, the chair of the American Bar Association's ethics committee and a partner at New York's Proskauer Rose. "There's very little interest in changing the rules.'
MacEwen asks for your input on this question, which you can supply below or at his site: "Who do you think is closest to the truth here -- understanding that all of us are looking into the future?"
Based on what I've been following in the blogs, I agree with the commentors that we'll see law firm IPOs at some point -- perhaps as soon as the next decade (my own prediction). I expect that ethics concerns such as those expressed by Krane will be glossed over or simply overhauled (a trend that we've already seen as firms merge and relax conflict-of-interest standards to retain clients). And while big firms certainly have a profit motive in pursuing IPOs, I also think that the blogosphere will help push the trend as well by continuing to provoke discussion between academics and large law firms on law firms IPOs.
Posted by Carolyn Elefant on June 15, 2007 at 05:05 PM | Permalink
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