The Risk of Risk Management

Abstract

Charles Dickens famously begins his A Tale of Two Cities with the lines, “It was the best of times, it was the worst of times . . . .”1 These lines might be applied with equal force to the large American law firm’s experience over the last two decades. Until the recent economic downturn that is the inspiration for the present symposium, law firm profits soared and elite lawyer ranks swelled.2 Yet, all has not been well in the glass towers of the mighty. A series of ethical scandals ensnared the best and the brightest, from Kaye Scholer in 1992,3 to Milbank Tweed in 1997,4 to those representing Enron in 2001.5 Recent economic difficulties have heightened large law firm awareness of and vulnerability to missteps.6 The dangers to the firms and their lawyers include not just malpractice claims but “criminal prosecution (of individual lawyers and law firms collectively), professional discipline, claims for disgorgement of fees, malicious prosecution, sanctions, and other allegations of wrongful conduct in the course of law practice, and even law firm dissolution.”7 One aspect of the elite firm response to the heightened dangers posed by legal missteps has been the adoption of risk management techniques of the