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$1M in Business Won't Get You a Place at a Law Firm The lateral road to equity partnership has gotten rockier in recent years, according to this LA Business Journal article, Sorry Partner, Not For Just a Million (7/9/07). According to the article, Los Angeles lawyers with one million in portable business can no longer expect to snag an equity partnership at top-tier firms, which these days are demanding at least $1.5 million in portable business and would prefer $2 million. The article explains that a firm generating $1 million in profits per partner likely has a book of business average of at least $2.5 million. So to bring in a partner with less than that amount of business would dilute existing partners' profits. So what are the options for a $1 million partner who wants to change firms? Many migrate to regional firms where $1 million is still significant. Others can take "of counsel" or nonequity positions at other firms. And of course, another option that isn't discussed is that lawyers with that amount of business can open up their own shop. What the article doesn't discuss is how the $2 million portable requirement affects associates. Are there midlevel associates who are generating that much in portable business (after all, it seems as if partners have even more incentive to hang on to all client matters to retain their equity statuts)? But if midlevel associates don't have a $2 million book of business, do they have a chance of ever moving to another firm? Posted by Carolyn Elefant on July 9, 2007 at 02:08 PM | Permalink | Comments (0) |
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