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WHAT WE'RE WATCHING

BACK TO BASICS - Despite law firm profits soaring in the last year, firm partnerships are increasingly uncertain about the future. As a result, according to new survey results, law firms are now doubling down on financial fundamentals such as pricing, clients development and talent, Law.com's Andrew Maloney reports. The 2022 Law Firm Profitability Survey from LawVision and Iridium Technology, published this week, found that nine out of 10 firms were satisfied or very satisfied with their profits over the last three years, and more than a quarter of respondents reported double-digit profit growth during that span. Still, factors such as inflation and geopolitical tension are coloring firm leaders' outlook. So instead of firm leaders focusing on big projects to innovate or transform their firm, the report authors highlighted a strong move toward what they called "profit fundamentals" this year, with firms focusing on pricing, production, talent strategy and client initiatives. The report likened it to football, with firms focusing on "basic blocking and tackling" as opposed to more dramatic changes. "We're starting to see this much greater push on—are we leveraged right? Are we utilizing our capacity effectively? We didn't see that in the same way in 2020. In fact, we haven't seen that in nearly the same way in previous years, so I do wonder if this isn't some form of a post-pandemic, kind of trying to find normal," said Mark Medice, principal at LawVision and one of the authors of the report.

PAY TO STAY - The money is getting bigger for almost every in-house legal position as companies shower top legal department talent with cash to keep them from leaving for more green, according to the latest annual global in-house compensation survey from Major, Lindsey & Africa. The MLA report, which is based on responses from 3,300 corporate counsel in 46 countries, showed that total actual cash compensation, which is salary plus bonus comp, for U.S.-based legal chiefs has increased 15% since 2020, hitting an average of $578,446. Michael Sachs, a Chicago-based in-house counsel recruiter at MLA, told Law.com's Phillip Bantz that lower-level counsel pay slipped, at least in part, because companies are throwing more money at upper-level legal department leaders to keep them from heading for the exit. "Retention was a huge factor," he said, noting that law firms and corporate legal departments have been engaged in an intense battle for legal talent over the past year, which he described as "probably the busiest year we've seen for movement in the in-house ranks." "Lots of general counsel were changing companies," he added. "Any company out there was realizing that their people have moved on or might move on. A big part of the compensation increase was to make sure that their people weren't such a flight risk anymore."

ON THE RADAR - Ice Miller filed a lawsuit Wednesday in Ohio Southern District Court on behalf of Bantam Bagels, a company featured on the popular reality television series 'Shark Tank,' and T. Marzetti Co. The suit targets Orange Streak over a $34 million asset purchase agreement. The plaintiffs dispute the defendant's assertion that it is entitled to an 'earn-out' following Bantam's failure to turn a profit after third party Starbucks terminated its contract. Counsel have not yet appeared for the defendant. The case is 2:22-cv-02950, T. Marzetti Company et al v. Orange Streak, LLC. Stay up on the latest deals and litigation with the new Law.com Radar. 

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